I wish to share time with Senator O'Reilly.
Insurance Industry
Is that agreed? Agreed.
I welcome the Minister of State and thank him for taking this very important Adjournment matter.
On 30 March 2010 life changed dramatically for people in Enniskillen, Navan, Blanchardstown, my county of Cavan and neighbouring counties. Thousands of individuals and their families were plunged into uncertainty about their future following the hasty and undue action taken by the Financial Regulator, Matthew Elderfield, to have provisional joint administrators appointed by the High Court to Quinn Insurance Limited. This action was taken without notice being given to the company. Since then 1,000 redundancies have been announced, 700 of which have taken effect.
The deadline for submissions of proposals and expressions of interest in Quinn Insurance Limited as a going concern was 8 December 2010. One such proposal has been submitted by the Quinn family in conjunction with Anglo Irish Bank. It is the only proposal that protects all policyholders and employment in Ireland, including a vibrant, profitable and potentially expanding export services business; ensures continuing competition in the Irish insurance market which is essential for the protection of consumers' interests; facilitates the repayment of €2.8 billion of Quinn family debt to Anglo Irish Bank and the taxpayer; and has cross-party and cross-Border support.
The proposal presented would see Quinn Insurance Limited remain 100% in Irish ownership under the control of the newly established independent board, fully compliant with the requirements of the Financial Regulator. I fully support the proposal, as does my colleague, the Minister for Agriculture, Fisheries and Food, Deputy Smith, who has worked closely with his Cabinet colleagues to find a resolution which will protect the jobs in Quinn Insurance Limited. My party colleagues in west Cavan, councillors Sean Smith, John Paul Feeley and Patricia Walsh, among others, are very concerned for the future of Quinn Insurance Limited, as are many of my Oireachtas colleagues. I had representations today in this regard from my colleague in Donegal, Senator Ó Domhnaill.
I understand a number of proposals are being examined by the administrators. I also understand the proposal I outlined briefly is not being considered. Why not? What objections have been made to it and from whom have they been made? Which other proposal achieved the retention of employment and a comparable return for the taxpayer?
Quinn Insurance Limited has enjoyed the highest profit margins of any general insurance company in Ireland over the past ten years and under the proposal I mentioned, 100% of the economic benefit would be retained for the company and the taxpayer. I would like to put on the record of the House my admiration for Sean Quinn, a man whom I regard as a practical patriot who in almost 40 years went from creating a job for himself to creating 7,000 jobs internationally, 5,500 of which are in this country and many thousands of which are in my native county of Cavan and surrounding counties.
The least the Quinn family and thousands of employees of Quinn Insurance Limited and the Quinn Group deserves is that the proposal to which I referred, which is the best proposal to see jobs retained in Ireland and the taxpayer gets back the money owed from the Quinn family, would be considered. I want to know why it has not been.
I thank my constituency colleague, Senator Wilson, for sharing his time on this crucial issue for our county. I walked in to the Kilmore Hotel in Cavan yesterday and met a crowd of young people who were under enormous stress. They were very strained and concerned about their mortgages, jobs, families and, in many instances, their children. They comprised a large segment of the 497 people who work in Quinn Direct in Cavan. There are in excess of 1,400 people employed in Quinn Group Limited and Quinn Insurance in Cavan.
Quinn Insurance Limited has been a profitable insurance company in the past ten years. It made significant profits of €16 million in the first quarter of 2010. It is a viable, profitable business. What is proposed in the submission from the Quinn board is that it would manage the business, take it over in the coming years and repay the debt to the taxpayer. The only way the debt will be paid to the taxpayer is through the proposition from the Quinn board because it would get the money directly back to the taxpayer.
We spend millions of euro on job creation and enticing jobs into the country. These are vital jobs in a depressed part of the country which could not be readily replaced and it is vital we keep them. I also support the proposition from the Quinn board as outlined by Senator Wilson. It is the one which is most likely to keep the jobs in Cavan. I have no other priority in addressing this question other than to keep the jobs in the county and keep our young people working there. The Quinn operation has transformed the county.
I am aware the Minister of State has strong connections with the county and I ask him to assure the House that the most senior members of Government, such as the Minister for Finance or the Minister for Enterprise, Trade and Innovation, become proactively involved in dealing with the administrators. I ask that sanity would prevail and that we would keep young people working in County Cavan. Otherwise they are destined for the emigration ship, families will be broken up, homes will be sold and children will suffer. It is an appalling vista. A human crisis is looming in an area where there is no potential for jobs to be replaced.
I recognise the sincerity of the input from Senators Wilson and O'Reilly. I am speaking on behalf of the Minister for Enterprise, Trade and Innovation, Deputy Batt O'Keeffe. I can confirm that I have been visiting Cavan, in particular a little place called Ballinagh which is a great holiday resort, every year for the past 30 years. Over the years I have seen the huge progress in Cavan which is no doubt mainly due to the serious investment and job creation in the area. I spent the first three days of the new year there. I will not pretend I was there on serious business because I was not. The conversation there, however, concerned the devastating effect of the job losses in Quinn Insurance.
More importantly, there are further fears for the operation. I have heard what the Senators said often and in detail. The Minister assures the House of his ongoing concern about the situation regarding Quinn Insurance Limited, in particular the long-term impact on the workforce, their families and the local community. The Senators will appreciate that for considerations of commercial confidentiality, it would not be appropriate for the Minister to comment on the participation of any party in the sale of Quinn Insurance. Responsibility for the sales process lies with the joint administrators appointed by the High Court. The Minister believes it would be inappropriate to speculate on what might happen to jobs in the company before a decision on its sale is made. I understand it is expected the joint administrators will decide on a preferred bidder shortly with a view to entering into detailed discussions with the bidder to seek to conclude an agreement on the sale of Quinn Insurance. In assessing the bids the joint administrators are required to consider how the interests of policy holders can be protected and the company can be returned to a sound commercial footing. The retention and protection of employment are important priorities, subject to the administrators' other responsibilities. The final decision of the joint administrators will be subject to the approval of the HighCourt.
It is important to clarify that neither the Government nor the Minister has any input into or influence over the administration process, including any decision on the sale of the company. The decision to appoint joint administrators, pursuant to the Insurance (No. 2) Act 1983, to take over the management of Quinn Insurance was taken in the best interests of the firm's policy holders. The aim of the appointment of joint administrators was to allow the firm to remain open for business in order that it could continue to be run as a going concern with a view to placing it on a sound commercial and financial footing.
Last June the High Court granted the joint administrators of Quinn Insurance permission to appoint merchant bankers Macquarie Capital Europe to advise on any prospective sale of the company. Macquarie Capital Europe, acting on behalf of the joint administrators, put a process in place to sell Quinn Insurance. On 27 August last Macquarie Capital Europe issued an information memorandum on the sale of Quinn Insurance to interested parties. That process is ongoing. The first stage of the process involved the submission of a non-binding indicative proposal by Friday, 17 September. Following evaluation by the joint administrators, a limited number of prospective purchasers were selected to participate in the second phase of the sales process. They were allowed to conduct further due diligence before completing a final bid. Final bids were submitted on 10 December. Macquarie Capital Europe and the administrators are considering the offers made. As I said, they are expected to decide on a preferred bidder shortly.
Senators will understand the Minister is constrained in what he can disclose to the House in respect of this competitive sales process. Responsibility for the sales process lies with the joint administrators appointed by the High Court. Last year, in response to developments in Quinn Insurance and in the light of concerns about the impact on employees' jobs, the Minister established an inter-agency team comprising representatives of Enterprise Ireland, FÁS, IDA Ireland, the relevant county enterprise boards and the Department of Social Protection. The team meets regularly under the chairmanship of Mr. Dan Flinter. Its first meeting was held in Cavan on 30 April 2010. Twelve meetings of the team have taken place to date. Active ongoing dialogue with the employee representative group has been a feature of the process. The 13th meeting of the inter-agency response team will take place in Cavan on 7 February.
The primary focus of the inter-agency team is on supporting the affected employees; exploring their employment options, including self-employment through setting up a new business; providing for skills development; and outlining the supports available to them. Dedicated information centres staffed by the agencies were established on site in Cavan, Navan and Blanchardstown to support the affected workers. Briefings and information sessions for the employees concerned were arranged at all three sites by Enterprise Ireland, FÁS, the county enterprise boards, the Department of Social Protection and other agencies, education providers and financial institutions as required. The Minister considers that the inter-agency team has been an effective solution to co-ordinate the activities of the relevant Departments, State development agencies and county enterprise boards to support employment opportunities for the employees concerned.
My clear understanding is that just one or two of the submissions made are being considered. I understand the proposal I outlined is not being considered at this time. I appeal to the Minister of State to refer the proposal to the Minister as a matter of urgency. It defies logic that it is not being considered. It is vitally important that it be considered, as it would ensure Quinn Insurance remained in full Irish ownership and that the €2.8 billion owed by the Quinn family would be repaid to Anglo Irish Bank and the State. While I appreciate that the Minister of State cannot comment on the matter, for reasons of confidentiality, I am stating clearly I understand, as we approach the decision date, that the proposal made by the Quinn family and Anglo Irish Bank is not being considered.