Leaders' Questions

In the past few days in the media and elsewhere there have been very serious allegations made about NAMA and its operations. My colleague, Senator Darragh O'Brien, has come to possess material, about which he has spoken in the Seanad and which he will be sending to the Garda Síochána. I understand from media reports that a dossier on the behaviour of a previous employee has been sent to the Garda Commissioner. Very serious allegations have been made which go to the heart of confidence and trust in an extremely important body that is acting on taxpayers' behalf. Certainty, confidence and trust in that body are essential and that is my only remit this morning.

One of the allegations being made which requires urgent clarification from NAMA is that an entire file on a person whose loan book was with NAMA was sent to a partner in a major global property company who was acting on behalf of that person's rival in advance of a major and high profile court case. That would be a shocking revelation if proved true; therefore, the issue cannot be left hanging; it needs an urgent response. Did this happen and if it did, is it just an isolated case or are there others like it?

It has also been asserted that property valuations have been manipulated, which is extremely serious. A person quoted in the material states: "There were perfectly good loans written down in the banks so as to keep the NAMA dream alive. I was the one they relied on to get the massive low valuations. I destroyed people with these valuations." That is extremely serious and cannot be left unanswered for any period. It is very important that we receive a very robust response from the Government and the Minister for Finance in this regard.

The relationship between the Department of Finance and NAMA must be clarified and should be articulated very quickly. Freedom of information requests were tabled to the Department in August 2012, but only six of 19 documents were given in response to these requests. The issue of the remaining documents is with the appeals commissioner. The Taoiseach knows that from the correspondence we have learned that the Barclay brothers were in contact with the Department about loan books in the IBRC. If we are to have confidence and trust, I ask the Taoiseach to say to the Department that it should withdraw any objection it has to releasing all of the material into the public domain in order to show it has nothing to hide. We must demonstrate that the Department, NAMA and key institutions are operating above board. Will the Taoiseach give an assurance that this can happen?

I can give an assurance that the Government is taking this matter very seriously. Yesterday I answered questions on it. I confirmed that the Garda was investigating a complaint in respect of an individual and that allegations had been made in regard to a second individual. The Garda has not come back to NAMA about that issue. This morning the Minister for Justice and Equality was advised by the Garda Commissioner that - I think people know this - there had been contact between NAMA and the Garda Síochána earlier this year with regard to another former employee. The Garda is awaiting a statement of complaint and supporting documentation. The Garda Commissioner also indicated that he had directed a senior officer to liaise with NAMA to ensure all of these matters of concern were fully pursued. I also understand the Committee of Public Accounts is in contact with NAMA about the investigations under way and that NAMA intends to assist the committee in so far as possible within the constraints of the ongoing Garda investigations. Where allegations of a criminal nature are made, the Garda is the appropriate authority to carry out the investigations.

The Deputy is aware that in respect of freedom of information requests, the Minister in a particular Department has neither sight of nor a function in what is agreed by the freedom of information officer in each Department to allow release. That is why there is an appeals system involving the Information Commissioner. It is not for the Minister to direct a freedom of information officer in any Department on what to release. The commissioner makes an independent decision in that regard.

The Deputy has made a serious point about an allegation that property valuations had been manipulated. I indicated yesterday that NAMA required the sale of all loans, properties and assets securing loans be conducted on a competitive and fully open market basis by suitably qualified and competent agents. In all these events NAMA insists on independent valuations of all assets. If an allegation is made of manipulation of valuations, it should be noted that NAMA requires an independent valuation of all loans, assets or properties dealt with. As I stated yesterday, a summary of a marketing campaign would be undertaken and all parties on a list expressing an interest in a loan or real estate would be contacted during the campaign. There would be a recommendation to accept the terms of the purchaser's offer, based on the best reasonably priced offer. There would be confirmation that the agent had reviewed the purchaser's confirmation and a statement disclosing any commercial relationship between the agent, the debtor, the purchaser or the ultimate beneficial owners in the past five years, or how any actual or perceived conflict of interest had been managed during a sales process. When the legislation was introduced, NAMA was exempt from freedom of information requests by the Government of which the Deputy was a member.

With regard to the issue of clarity and freedom of information, the only reason the matter is with the appeals commissioner is that someone has objected to releasing all the files in regard to the request. The body that has objected is the Department of Finance. Only six out of 19 documents were released. All of the material should now be released in the interest of transparency and to generate confidence.

I am not casting aspersions on anybody but I believe it is important that there be certainty, trust and confidence. When one sees the Department of Finance withholding documentation that might relate to overtures or representations made by a very significant player to the Department, it appears as though people are hiding something and using freedom of information mechanisms to prevent material from getting out.

The Taoiseach said the Garda was awaiting information from NAMA on this issue. For how long has it been doing so? When does NAMA expect to be in a position to co-operate fully?

The Taoiseach referred to the Comptroller and Auditor General. The latter is on record has having said he does not have the capacity, in terms of staff or otherwise, to audit NAMA, given that it is such a big behemoth. That is a key issue for us. There is a 10% turnover of staff in NAMA, which in itself is causing significant issues for the agency. Does the State actually have the capacity and personnel to audit NAMA? This is a key point in our attempts to generate confidence and trust in the organisation and what it is doing. It is ultimately about the taxpayer.

The Deputy’s party established NAMA.

Deputy Martin is well aware of the legislation that deals with the freedom of information system. Ministers in government do not have-----

I referred to the Department.

Is the Deputy talking about the Department or the freedom of information officer? Every Department has a freedom of information officer who deals exclusively with freedom of information requests. There is no contact between a freedom of information officer in any Department and the Minister or Minister of State. The officer makes his or her decisions independently. The law stipulates quite clearly that there is an appeals process, which is also independent. It might not be a good idea to get into the business of having Ministers state what should or should not be-----

There was no mention of Ministers.

To be honest, I do not know the information that was released. I do not have access to it. I do not have any contact with NAMA.

It is approximately 15 months since the original request was made.

If a Topical Issue debate is requested of the Minister for Finance, he may have more information to give than I have. I do not have contact with NAMA, obviously.

It is a bit more serious than a Topical Issue; it is not about a water scheme in Belmullet.

The law is very clear in so far as freedom of information officers and their responsibilities are concerned. The same applies to appeals.

The Minister for Justice and Equality confirmed that he was advised by the Garda Commissioner this morning that there had been contact between NAMA and the Garda Síochána earlier this year in regard to another former employee. That investigation is ongoing and will conclude whenever it concludes.

More recently, in August of this year, the Garda Síochána received a separate complaint from a firm of solicitors acting on behalf of a client. That related to the alleged disclosure of information by NAMA. The Garda has been awaiting the receipt of further documentation from the solicitors. The Garda will obviously fully investigate the matter if and when the information is sent to it. I cannot tell how long that will take or what information is involved.

I agree with the Deputy that we cannot allow activity of the kind alleged. One complaint is being followed through. Information was received in respect of the second but the Garda has not been in contact with NAMA about that. Obviously, it will follow it through if and when the information is presented. It is a matter of serious concern, given that NAMA has one of the largest property portfolios in the world.

The Minister for Health, Deputy James Reilly, has bypassed any meaningful democratic scrutiny of the HSE service plan by the Oireachtas by delaying its publication until the last sitting week of the year. As the Taoiseach knows, details of the plan were leaked before the Dáil had sight of it and before it could be discussed by the health committee. All the spin about health cuts, including the spin that cuts affecting medical cards would be smaller than previously signalled, does not impress anyone. I draw the Taoiseach's attention to the case of Merryn Lacey, a four-year-old girl from Donabate who is fighting stage 4 neuroblastoma, a very rare form of children's cancer. She is currently undergoing chemotherapy. Yesterday she had her application for a medical card rejected. There is also the case of Kate McShane, about whom I have talked to the Taoiseach before. She has Down's syndrome and needs long-term medical care. She is still being denied a medical card. What of those profoundly deaf children awaiting bilateral cochlear implants? I welcome cautiously the fact that €3.2 million has been allocated for them, but that sum is actually less than what is required. Does the Taoiseach accept that the only valid test of the HSE service plan - whenever we get around to discussing it - will be whether it results in these citizens getting the treatment and service to which they are entitled? Receiving the service is their right. Could the Taoiseach assure parents of seriously ill children and every other sick citizen that the HSE service plan will be such that they will get the treatment they deserve?

I explained this process to the Deputy before. The budget takes place and Votes go through in respect of the ceilings for each Department. The HSE prepares its draft report based on those figures and submits it to the Minister for Health. The Minister examines the draft proposition and recommends changes or amendments thereto, and he either signs off on it or does not. The Minister engaged in very careful consideration of the draft report by the HSE and made recommendations for changes to it. Following the amendment of the report, he approved the service plan for 2014.

The question of the €113 million that was allocated in respect of the probity issue concerning medical cards is one of serious importance for people around the country. The position was that when this was included in the budgetary figures in the first instance, it was subject to a process of examination. The Minister for Health examined this, in accordance with his duty, both from within the Department and from the point of view of the HSE. He found that the figure of €113 million in savings in respect of medical cards was not achievable. Owing to that, a change was brought about.

The position is that €47 million was available from the Department of Social Protection because of the drop in the number on the live register and savings made in that Department by its Minister, Deputy Joan Burton. Only 22 cards in the entire country were returned voluntarily because of changes of circumstances, such as somebody getting a better job or benefiting from a rise in income. There are more medical cards issued now than ever before. Therefore, the normal process of the validation of eligibility will continue. I do not suppose the Deputy is expecting me to say that the Minister should have changed the eligibility criteria for medical cards, because he did not do so. There will be an ongoing review of medical cards, as has always been the case. However, the figure that was included in the original budget was not acceptable to the Minister, so he changed it. That is a good thing.

The Government made the cut. The Taoiseach should not be absolving himself.

I thank the Taoiseach for explaining to me once again how the HSE service plan is arrived at. I find that very instructive. Let me assure the Taoiseach that he does not have to explain it to me ever again.

What he could do is answer the question I asked him, which was whether he will give assurances to the parents of seriously ill children that this new service plan will ensure that they get the services they require. I have explained to the Taoiseach before that it appears to me that the Minister for Health dreams up figures, cuts services and then at the end of the year comes back to the House with Supplementary Estimates of hundreds of millions of euro. All of this begs the question - from where did the Minister pull the original figures in the first place?

It goes without saying that any society, but particularly one which describes itself as a republic, should be judged on how it treats its most vulnerable citizens. I make the case that these children and other sick citizens are among the most vulnerable. I ask the Taoiseach again if he can give an assurance that this service plan, which I believe is a blueprint for greatly reduced services, will give our citizens the services they require. Whatever about the differences between the various figures that were given, the fact is that the health budget will be cut by over €600 million. Does the Taoiseach agree that over €600 million in cuts will have utterly devastating consequences for our citizens and our health services?

I agree that this will be a challenging year for the Department of Health, no more than for any other Department. I made it perfectly clear that the fact that the country has exited the bailout programme does not mean that everything is rosy in the garden. Deputy Adams, as the leader of the party of the impossible, is never going to be satisfied no matter how much is allocated to any particular sector. That is his job and that is fair enough.

The health service plan for 2014 has now been approved by the Minister for Health.

While this will be a challenging year, we expect that the Minister's philosophy of cutting costs but not front-line services will continue to be effective in the interests of patient outcomes, which is the most important element of any health service. Outcomes and the opportunities for patients to have the best level of service as close to home as possible are our focus. In the service plan for 2014 there are a number of new and important initiatives. A sum of €1.48 million has been provided to deliver patient-centred improvements in maternity care, which was raised in this House previously. There is an extra €8.3 million for the cancer area and an additional €2.92 million for organ donation and transplantation services. I had discussions with some well known people recently about the importance of the latter. A sum of €35 million has been provided for an additional 60,000 medical cards in 2014, while €37 million has been provided for free GP services for children under six. An additional €14 million has been provided to address priority needs in the disability area and €20 million has been ring-fenced for the recruitment of mental health staff.

That is far below what is required.

The plan also provides €3.2 million to commence the sequential and simultaneous bilateral cochlear implant programme, with particular focus on those aged between five and six. That is an issue which Deputy Adams himself raised in this House. While we do not have all of the money to do all of the things we would like to do, these are key service initiatives which will take place in addition to effective delivery of front-line services for patients in 2014.

Other patients will be paying for those services.

Front-line services are not being delivered.

(Interruptions).

I agree that it is challenging for the Department of Health but it is the commitment of this Government to continue to cut costs but not services.

I wish to raise the Government's A Strategy for Growth document in which I found only two sentences relating to the issue of the retrospective recapitalisation of banks. The document is 66 pages long but there are only two sentences on page 26 relating to this crucial issue, which read as follows:

...the Eurogroup has agreed that retroactive recapitalisation may be agreed on a case-by-case basis as part of the European Stability Mechanism's Direct Bank Recapitalisation instrument (DBR). Significant work remains to be done on the details of this instrument.

We can only come to the conclusion from this that the Government has thrown in the towel and accepted that retroactive recapitalisation is not going to happen. The Taoiseach and his Government are accepting the situation where 40% of the cost of bailing out the EU banking system is being borne by this State, with only 1% of the population of the EU. Is the Taoiseach accepting the situation where each and every person in this State is saddled with €9,000 of bank debt as against an average of €200 per person in the rest of the EU? Does he think this is fair? I certainly do not think it is. This country has an unsustainable level of debt, amounting to €200 billion or almost 125% of our GDP. We are in a very precarious situation and are dependent on the international bond markets to be able to borrow at affordable interest rates. Ireland needs a growth rate of 4%, sustained over the next decade, to make this level of debt sustainable. Given the commitment of this Government to tight fiscal policies, we would need a very favourable international economic climate to achieve that level of growth. There is no guarantee of this happening. What could and would make our debt sustainable is a debt write down on the €64 billion bank bailout. Does the Taoiseach agree that retrospective recapitalisation through the ESM would achieve that? This should be a key priority for the Government and not a footnote in its medium-term economic strategy.

Some Deputies in this House have not thrown in the towel. I instructed my legal team this morning to submit an appeal to the Supreme Court seeking to overturn the recent High Court decision on the promissory note and the Credit Institutions (Financial Support) Act of 2008.

It looks like the Attorney General will be working over Christmas.

(Interruptions).

That was Deputy Mathew's speech there. He has made it on a number of occasions.

That is what the Government promised.

The Taoiseach should stand up to these people.

(Interruptions).

I did not realise that he had become the financial adviser to the Technical Group and others.

The mid-term economic strategy document published yesterday sets out the major signposts for what the Government hopes to achieve. Our aims are very clear and include reducing our debt and putting our people back to work. We are trying to restore the 330,000 jobs that were lost because of the incompetence and maladministration of the previous Government. Every Department will provide details in the new year of the proposals from the agencies for which they are responsible, within that framework.

What about the banks? The Taoiseach needs to answer the question he was asked.

(Interruptions).

I ask Deputies to be quiet, please.

Previous Governments set out volumes of detail on objectives that were completely unachievable.

Deputy Collins asked about bank recapitalisation. Clearly, the successful sale of €2.05 billion in preference shares, including principal profit and accrued interest, by Bank of Ireland last week was important and a sign of confidence in itself. The State has now recouped a net positive cash return of €1.1 billion from its overall investment in and support for Bank of Ireland. That net cash return is before account is taken of the State's continuing equity investment in the bank, which is worth a further €1.2 billion at current market prices.

We dealt earlier this year with the constant barrage of comment about the promissory note and the liquidation of the former Anglo Irish Bank and Irish Nationwide. The question of bank recapitalisation is the subject of quite a deal of current discussion. Last night at the ECOFIN meeting, EU Ministers for Finance continued to deal with central elements of this issue.

(Interruptions).

I have always said that dealing with the decision made last year regarding the possibility of the ESM being able to recapitalise banks directly could only happen after banking union is fully in place. It is not fully in place yet but the Deputy will be aware that the Eurogroup meeting of 20 June this year made the decision to which she referred, namely that the potential retroactive application of the instrument would be decided on a case-by-case basis and by mutual agreement.

I do not accept the Deputy's assertion that the Government has thrown in the towel on this. This is very much a live issue and the subject of complex and technical negotiations which are continuing. There is still a lot of negotiation to take place on this matter.

According to the Schäuble agenda.

(Interruptions).

We always said that when the Single Supervisory Mechanism was in place, involving all of the agreements required there, the question of retroactive recapitalisation on a case-by-case basis would be dealt with.

Following the decision last year to break the link between sovereign debt and bank debt, the ECOFIN group has made substantial progress, which is to be commended and accepted.

For the future.

We will continue this process. When banking union is fully in place by the second half of next year, we will continue to make the case for implementation of the decision made on 29 June last year which still stands and which has been clarified on a number of occasions. At every opportunity the European Council has discussed it and the decision stands. That is an issue we can only deal with, as we have always pointed out, when the issue of banking union is dealt with and in place by the second half of next year.

I do not accept that the Government has thrown in the towel. The negotiations are quite complex and the argument will be made on a case by case basis. Many European countries have recognised the scale of the specific and particular circumstances this country has had to deal with and that they have to be taken into account in dealing with claims on a case by case basis.

The Taoiseach started off by saying the document was a major signpost to economic recovery over six years. Two sentences refer to the recapitalisation of the banks. It is said it “may” be decided on a case by case basis. The issue is not high on the agenda, but it should have been at the forefront of the document that we demanded a write-down of the debt, on which everything depends. We are talking about a figure of €64 billion. We are depending on international bond markets and interest rates remaining low. The inflation rate will go up if the United States stops printing money. We require 4% growth in the next ten years and everything depends on outside factors. This is one area in which the Government has a responsibility to the people to take the €9,000 debt burden from around our necks and relieve the situation in order that we can then consider the provision of cochlear implants and the health service. I do not accept what the Taoiseach said.

We would do nothing at all if we were to listen to the Opposition.

The Taoiseach has thrown in the towel. He has played footsie with the European Union; he should play hard ball.

Deputy Peter Mathews is not always right.

I am not sure whether Deputy Peter Mathews gave Deputy Joan Collins that supplementary question, but the Government has not thrown in the towel. I have made it perfectly clear that there is a process that has to be gone through before we can deal with the specific negotiations. If the Deputy thinks one can go to a European Council meeting and say to 27 other leaders, "By the way, I want a cheque for €50 billion,"-----

We bailed them out.

-----she is very naïve about the way in which negotiations are conducted.

They bailed us out.

We bailed them out.

Will Members, please, abstain from interrupting?

The fact of the matter is that for a number of years when the warning signs were there and they were indicated by this party in opposition-----

I thought it wanted more.

What warning signs?

-----the Government of the day failed to listen and act and put the noose around the neck of every single person in the country and lost 330,000 jobs in the process.

There are two sides to the Opposition.

Fine Gael wanted more and more.

We are going to clean up the mess. It might surprise Deputy Joan Collins to hear that from 1 January this year we had to deal during the six months of the Irish Presidency of the European Union with CAP reform, the reform of the Common Fisheries Policy, the banking union negotiations, the abortion legislation, the promissory notes, the Magdalen laundries, Priory Hall, the preparation of a budget and the exit from the bailout programme.

Let us work together.

Even within Fine Gael.

Members should sit back and listen to themselves.

This has been a good year for the people in dealing with much of the atrocious economic and social mess left behind by the previous Administration. We have not thrown in the towel and when banking union and the single supervisory mechanism are in place, as I said, potential retroactive applications will be decided on a case by case basis and by mutual agreement.

(Interruptions).

Will Members, please, stay quiet?

That decision still stands and it is in that space that we will negotiate with our colleagues in Europe when banking union is fully in place.

Now Mattie; throw another sod on it.

That will happen in the latter half of next year.

Deputy Joan Collins is right - the matter should be at the top of the agenda.

Peter’s exit.

Is Deputy Peter Mathews still independent?

Deputy Joan Collins presented the question. I had nothing to do with it.

The Fine Gael Whip needs to have a private meeting with his members.

It is Deputy Joan Collins's initiative. I am only a listener, but I agree with her.

For a listener, the Deputy talks a lot.

Written Answers follow Adjournment.