Written Answers Nos. 302-324
302. Deputy Heather Humphreys asked the Minister for Finance the procedure to be followed when a property tax notice issues in error to a person at a previous address (details supplied); and if he will make a statement on the matter. [16971/13]
View answerThe Finance (Local Property Tax) Act 2012 (as amended) sets out how the tax is to be administered and provides that a liability for Local Property Tax (LPT) will arise where a person owns a residential property on the liability date which will be 1 May 2013 for the year 2013. A key aspect of the work undertaken by Revenue was the development of a comprehensive Register of residential properties in the State. The Register was developed using data drawn from a range of sources including Revenue’s own databases, the Local Government Management Agency database and data from utility companies. Data from the various sources has been cross-checked to ensure that the Register is as accurate as possible. The Register is being used to issue correspondence to property owners and work is still in progress to refine it.
I am informed that while every effort has been made to correctly match residential properties to owners, in a small number of cases, some individuals who are renting properties have inadvertently received LPT Returns from Revenue for the property. One reason for this may be that the landlord of the rented property has not registered with the Private Residential Tenancies Board.
Indeed the possibility of individuals other than owners receiving Returns in error, has been cited by the Chairman of the Revenue Commissioners in public statements that she has made in connection with the currently ongoing general issue of LPT Returns. I am further advised that this particular possibility is covered in the letter and the information booklet that accompanies the LPT Return. The correspondence advises anyone who receives an LPT Return from Revenue, but who is not the liable person in respect of a property, what steps they should take. It is important that they should not ignore the Return.
Where an individual who is renting a property receives a Return for that property they should advise Revenue in writing that they are not the liable person in respect of the property and provide the relevant supporting documentation, where available. This will ensure that the LPT Register can be corrected. I am advised by Revenue that individuals who are receiving LPT Returns in error are advising the Revenue Commissioners, who are updating the Register accordingly.
I am further advised by the Commissioners that rather than issuing multiple Returns to owners of multiple properties, a single letter issued to each of these owners instructing them to file their Returns for their properties on-line. As the Deputy’s constituent received a single Return in his or her name from Revenue, this would suggest that it is the only property that Revenue would have identified the constituent in question as the owner of. However, if the Deputy wishes to supply the details of the constituent, I will pass these on to the Revenue Commissioners, who will check the LPT Register to ensure that this is the case.
While it is absolutely regretted that any correspondence issues to the wrong person, given the scale of the operation involved, there was always a likelihood that this would arise in some instances. I am very satisfied that as part of Revenue’s communications around the general issue of LPT Returns, the Commissioners sought to fore-warn taxpayers and they have provided very clear guidance on the steps that should be taken in these cases.
303. Deputy Róisín Shortall asked the Minister for Finance if it is the case that the payment of either national or sub-national property taxes in respect of a property that is owned by an Irish resident but rented out in a foreign jurisdiction can be used to reduce the income tax bill arising from the rental income from the property; and his estimate of the cost of this provision to the tax-payer in the past year for which figures are available [16978/13]
View answerI am advised by the Revenue Commissioners that their published practice, in relation to foreign rental property states that a property or ownership tax cannot be claimed as a deduction or a credit against any Irish tax liability arising on rents arising from the letting of foreign property. All the relevant details can be found on the Revenue website http://www.revenue.ie/en/personal/buy-sell/foreign-property/foreign-income-tax-paidliability-irish-tax.html . Taxable rental income from foreign rental property is generally calculated in the same way as taxable rental income from Irish property, with the same deductions and allowances being available.
In that regard, the main deductible expenses available in respect of Irish rental property, as provided for in the Taxes Consolidation Act 1997, are:
- any rent payable by a landlord in the case of a sub-lease;
- the cost to a landlord of any goods provided or services rendered to a tenant;
- the cost of maintenance, repairs, insurance and management of the property;
- the interest paid on borrowed money used to purchase, improve or repair the property (which, in the case of residential property, is restricted to 75% of the interest); and payment of local authority rates.
In addition, wear and tear capital allowances are available in respect of the capital expenditure incurred on fixtures and fittings provided by a landlord for the purposes of furnishing rented residential accommodation. These allowances are granted at the rate of 12.5% per annum of the actual cost of the fixtures and fittings over a period of 8 years.
I am further advised by the Commissioners that credit against Irish income tax for property tax paid in respect of property located in a foreign jurisdiction is not available under our double taxation treaties. In the first instance, credit under a tax treaty is only available in respect of taxes listed in the treaty, and most of Ireland's treaties cover income and capital gains, but not capital taxes. Secondly, in the relatively small number of Irish tax treaties (less than one in seven) that include provisions on the avoidance of double taxation with respect to capital, the principle adopted by the OECD that credit is to be allowed for income tax only against income tax, and for capital tax only against capital tax, is followed. This means that, in those tax treaties that itemise property tax in the foreign jurisdiction in the list of taxes covered by the treaty, the double taxation relief provisions in each provide that credit for the property tax will not be given against income tax in Ireland.
305. Deputy Heather Humphreys asked the Minister for Finance his plans to increase personnel in Customs and Excise in the border area to help eradicate the problem of laundered diesel in the border counties; and if he will make a statement on the matter. [16987/13]
View answerRevenue is an integrated tax and customs administration. The Revenue Commissioners currently has approximately 2,000 staff engaged on activities that are dedicated to target and confront non-compliance. These front-line activities include anti-smuggling and anti-evasion, investigation and prosecution, audit, assurance checks, anti-avoidance, returns compliance and debt collection. Revenue has an enforcement presence at strategic locations throughout the State. Enforcement strength at particular locations is regularly augmented with additional personnel on a risk-assessment basis, or when particular operations are taking place. Revenue adopts a comprehensive strategy to tackle the problem of laundered diesel. Their “Strategy for Combating the Illegal Trade in Mineral Oils (2011-2013)”, which is published on the Revenue website (www.revenue.ie), includes a range of measures designed to complement each other in targeting the supply and demand sides of the market for laundered diesel. This strategy includes supply chain controls designed to deny fuel launderers access to marked fuel for laundering and to deny them access to the market for laundered fuel. In this work, Revenue is supported by well-established structures to ensure very close cooperation between all relevant agencies north and south of the border. The Cross Border Fuel Fraud Group brings together representatives from a number of agencies, including An Garda Síochána, the Criminal Assets Bureau and the PSNI, in addition to the Irish and UK Revenue authorities. There is excellent cooperation between all these agencies in the sharing of intelligence and identification and investigation of the organised criminals involved in this fraud. Measures taken to date include the introduction of a stronger licensing regime for the auto-fuel sector and the introduction of a new licensing regime for marked fuel traders in October 2012. From January 2013, new reporting requirements have taken effect which require all licensed fuel traders to report their transactions to Revenue on a monthly basis. This supply chain data will enable Revenue to identify suspicious or anomalous activity for investigation.
The Revenue Commissioners are subject to the Employment Control Framework staffing reductions imposed since 2009. Revenue’s overall staffing levels have reduced from a total of 6,581(FTE) at the end of 2008 to its current level of 5,780 (FTE). Notwithstanding this reduction, Revenue staff resources assigned to compliance activities have been maintained at around 2,000. The Revenue Commissioners have accorded a very high priority to the tackling of the illegal trade, including laundered diesel, and they are committed to ensuring that despite the staff reductions that this enforcement work will continue to be resourced to the maximum extent possible. The Deputy will appreciate that for reasons of operational sensitivity the Commissioners are not in a position to provide details or plans of enforcement deployment at any given location.
306. Deputy Brendan Griffin asked the Minister for Finance if the reduced rate of VAT applies to ice-cream parlours; and if he will make a statement on the matter. [16992/13]
View answerI am advised by the Revenue Commissioners that the standard rate of VAT, currently 23%, applies to the sale of ice-cream, as it does to the most confectionery and sugary foods. In this respect, ice-cream parlours selling ice cream to customers must charge the 23% rate on the supply of ice-cream. However, where ice-cream is provided as part of a meal by a caterer, such as a restaurant, the meal, including the ice-cream element, is liable to VAT at the 9% reduced rate.
307. Deputy Robert Troy asked the Minister for Finance if he will outline the procedure to withdraw the pre-retirement additional voluntary contributions; and if he will make a statement on the matter. [17001/13]
View answer341. Deputy Kieran O'Donnell asked the Minister for Finance when he expects that eligible persons will be able to avail of the new provisions in the Finance Act 2013 for the pre-retirement access to AVCs; the date eligible persons will be able to encash up to 30% of AVCs; and if he will make a statement on the matter. [17412/13]
View answerI propose to take Questions Nos. 307 and 341 together as both relate to pre-retirement access to Additional Voluntary Contributions (AVCs).
Finance Act 2013 was passed into law on 27th March and section 17 of the Act, which makes provision for pre-retirement access to AVCs, has effect from that date. Section 17 introduces a new section 782A into the Taxes Consolidation Act 1997 which provides members of occupational pension schemes with a three-year window of opportunity to draw down, on a once-off basis, up to 30% of the accumulated value of certain AVCs made by them, including additional voluntary PRSA contributions made to AVC PRSAs. Where AVCs are subject to a pension adjustment order, both parties to the order may exercise the option independently in respect of their respective “share” of the AVCs.
The procedures set out in the legislation for exercising the AVC access option are straight forward and I have outlined these hereunder. However, in addition to these procedures, I am aware from discussions which my Department and the Revenue Commissioners have had with various pension industry representative bodies, that the administrators of AVC funds will also be putting administrative procedures and systems in place to facilitate the access option at an operational level. I understand that these administrative and systems procedures are in the process of being finalised.
The likelihood is, of course, that an individual contemplating availing of the option will firstly contact his pension fund administrator by phone or email to establish what he or she needs to do. In that regard, the legislation requires the individual to give an irrevocable written instruction to the administrator of the fund that he or she wishes to avail of the option. Provided the individual qualifies for the encashment option, the administrator acts on the instruction by determining the value of the AVC fund and paying an amount, not exceeding 30% of the value, to the individual subject to deduction of the appropriate amount of tax. The amount paid is treated as emoluments to which Schedule E applies and tax is collected at source under the PAYE system. The legislation requires the administrator to deduct tax at the higher rate of 41%, unless the administrator has received from Revenue a tax credit certificate in respect of the individual. The payments are specifically exempt from USC and PRSI.
I am advised by the Revenue Commissioners that, in advance of any payment of AVCs being made, the individual exercising the option should contact his or her Revenue Office for a Certificate of Tax Credits and Standard Rate Cut-off point in respect of the AVC payment. It may be the case that the pension fund administrator will contact Revenue on behalf of the individual, but where the individual is applying directly to Revenue he or she would need to advise Revenue of the pension fund administrator's registered number (i.e. employer number) so that Revenue can forward the Certificate to the correct administrator. The Certificate will indicate the Standard Rate Cut-off Point and tax credits, if any, appropriate to the AVC access payment and facilitate the deduction of the correct amount of tax by the administrator.
311. Deputy Stephen S. Donnelly asked the Minister for Finance the plans in place to deal with mortgage arrears in institutions outside the specified credit institutions, specified in the Central Bank's mortgage arrears resolution targets in March 2013; and if he will make a statement on the matter. [17060/13]
View answerThe Deputy will be aware that the Central Bank announced new measures to address mortgage arrears, including the publication of performance targets for the main mortgage banks. The targets are set in relation to both Principal Dwelling Homes and Buy to Let mortgages. Performance targets have been set for:
- ACC;
- AIB;
- Bank of Ireland;
- KBC Bank Ireland;
- Permanent TSB; and
- Ulster Bank.
The Central Bank has advised that these institutions cover the vast majority of the mortgage book in Ireland, accounting for around 90% of mortgages held and that it will examine whether it should extend the targets to other mortgage lenders in due course. The Central Bank also continues to engage with all regulated lenders to ensure that adequate mortgage arrears resolution strategies are in place.
312. Deputy Michael McGrath asked the Minister for Finance his plans to review the position regarding the availability of tax credits to company directors, particularly in a start-up scenario, as a measure of supporting certain enterprises; and if he will make a statement on the matter. [17066/13]
View answerI assume the Deputy is referring to the provision of a tax credit similar to the PAYE tax credit of €1,650 for individuals who start their own business. Such a measure could prove costly to the Exchequer. If 10,000 new businesses were created in 2013 the cost of the credit could be €16.5 million, potentially rising to €49.5 million in 2015 if the same number of businesses were created each year. A large portion of this cost could relate to deadweight.
It is not clear whether the introduction of such a credit for self-employed individuals would be effective, given that many new businesses are loss-making in the early stages and, as a result, the credit would be unused by many individuals. It is unclear how this tax credit would stimulate business creation, or increase levels of employment. The provision of such a tax credit would not be sufficient in its own right to encourage individuals to take up self-employment.
As the Deputy is aware, in the recent Budget I announced a 10 point tax reform plan to help small business. Many of the measures contained in this plan are available to entrepreneurs who start their own business, including a 3 year corporation tax relief for start-ups, increasing the VAT cash receipts threshold and extending the Employment and Investment Incentive and Seed Capital Scheme.
313. Deputy Éamon Ó Cuív asked the Minister for Finance the date on which the budgetary process for 2014 will commence in view of the fact that the budget is due to be delivered in Dáil Éireann early this year; and if he will make a statement on the matter. [17074/13]
View answer314. Deputy Éamon Ó Cuív asked the Minister for Finance the changes made by him, since coming to office, to the operation and the timing of the budgetary process; and if he will make a statement on the matter. [17075/13]
View answerI propose to take Questions Nos. 313 and 314 together.
The budgetary process for 2014, like any other year, is a “whole-year” process and in that regard preparations have already commenced for Budget 2014.
Last March, both ECOFIN and the European Parliament agreed on the content of two draft regulations known as the “two-pack”. The “two-pack” is currently undergoing the jurist linguists process which finalises the regulations in all official languages and it is expected that they will be formally adopted in May or June.
One of the regulations concerning common provisions for monitoring and assessing draft budgetary plans includes the following requirements:
- the draft budget for central government and the main parameters of the draft budgets for all the other sub-sectors of the general government must be published by the 15th of October each year;
- draft budgetary plans in a common format must be submitted by all Euro area Member States not in a programme of assistance;
- the draft budget must be based on independent macroeconomic forecasts which are defined as forecasts produced or endorsed by an independent body; and
- the budget for the central government must be adopted or fixed upon and published by the 31st of December each year.
In light of these requirements, the Government has decided to bring Budget Day forward from the first week in December to on or before the 15th of October from now on. This means that Budget 2014 will be presented on Tuesday, the 15th of October this year.
The Government has also decided that the Finance Bill should complete its passage through the Oireachtas by the 31st of December each year. This timeline will be considerably shorter than the present requirement that it must be enacted within 120 days of the Budget. Under the new arrangements, the Finance Bill will have to be passed 65 to 70 days after the Budget.
Following the Government decision on the timing of the budget, the Departments of Finance and Public Expenditure and Reform are considering the follow-on implications of moving both Budget Day and the Finance Bill forward. It is the intention of both Departments to keep all bodies that contribute to the Budget and Finance Bill processes fully informed of changes so that they can plan accordingly.
The decision on implementation of the independent macroeconomic forecasts is still under consideration. Furthermore, the Government will decide later in the budgetary process whether to submit a draft budgetary plan in the common format as Ireland is exempt from this requirement because it is in a programme.
With regards to the operational budgetary process, the Deputy should be aware that there have been numerous European developments over the past few years including strengthening of the Stability and Growth Pact through the six-pack, the Fiscal Stability Treaty and continuing with the two-pack as outlined above. The impacts of all of these are taken into account.
Furthermore, the Deputy should also note that my colleague, Mr. Brendan Howlin T.D., the Minister for Public Expenditure and Reform has implemented significant changes on the Expenditure side of the Budget including the introduction of a Medium-Term Expenditure Framework, which includes multi-annual expenditure ceilings, the extension of the performance budgeting initiative, including the introduction of IrelandStat and the introduction of a public spending code.
315. Deputy Ciarán Lynch asked the Minister for Finance if he will confirm that a non principal private residence is subject to both NPPR tax and to local property tax; and if he will make a statement on the matter. [17085/13]
View answerThe Non-Principal Private Residence charge (NPPR) is a matter for my colleague, the Minister for the Environment, Community and Local Government. The NPPR charge will be collected in 2013, when a half-year Local Property Tax (LPT) will also apply. The NPPR charge will be discontinued thereafter.
316. Deputy Terence Flanagan asked the Minister for Finance the way the money collected from the pension levy is being spent; and if he will make a statement on the matter. [17125/13]
View answerThe implementation of a jobs and growth strategy is a key priority of the Government. The moneys raised from the pension fund levy are being used to pay for the Government’s Jobs Initiative introduced in May 2011. The Jobs Initiative contains a range of measures aimed at assisting in employment generation – providing opportunities for those who are out of work, to restore public morale and confidence in the economy and encourage spending by consumers. Amounts received from the pension fund levy are paid into the Exchequer central fund. Central fund is made up of tax revenue, non-tax revenue and borrowing. These funds are used in the day-to-day running of the State and it is therefore extremely difficult to quantify which specific funds are used for which purpose. That said, it is possible to cost the measures contained in the Jobs Initiative and examine their effect on the relevant sectors.
As part of the Jobs Initiative, a new reduced rate of VAT at 9%, with effect from 1st of July 2011 until 31st December 2013, was introduced. This reduced rate targeted services and goods relating to the employment intensive tourism sector. This measure was estimated to cost the Exchequer €470 million in reduced VAT receipts by end 2012.
Upon assessment of this measure in late 2012, contained in the Medium Term Fiscal Statement, it was shown that there was significant pass through of the VAT reduction to tourism related goods and services. It can reasonably be inferred that this policy measure has contributed to the employment growth evident in the food and accommodations services sector since the measure was introduced.
One way to help job creation and improve our labour cost competitiveness is to ease the costs on employers of taking on new employees. Accordingly, the Jobs Initiative announced the lowering of employers PRSI for lower paid employment until end 2013. PRSI initiatives were estimated to cost over €303m in the two years to 2012.
In line with the Government’s priority of fostering growth and creating jobs, the Finance Bill 2012 gave effect to measures supporting employment for both the FDI and SME sectors. These measures included a special assignee relief programme to encourage foreign companies to invest in Ireland, a foreign earnings deduction to assist the expansion into emerging markets and changes to the R&D tax credit scheme to aid the SME sector. These measures are estimated to cost the Exchequer €16 million on a yearly basis.
As the Deputy is aware, a significant portion of the policies contained in the Jobs Initiative are related to labour market activation and capital projects. The Governments strategy on labour market activation – Pathways to Work – strives to ensure that, as employments opportunities materialize through the Jobs Initiative, as many of these jobs as possible are filled from the live register – with a particular focus on those who are long term unemployed or at risk of long term unemployment. In addition, the Job Bridge internship programme gives employers the opportunity to provide valuable work experience to the unemployed and as an added benefit gives employers the ability to assess the suitability of individuals for future employment.
As noted, the Jobs Initiative will also allow for various capital projects to take place, creating further employment opportunities. For example, capital funding was made available for 374 primary and post primary school building projects. As stated at the launch of the Jobs Initiative, this investment alone will create approximately 2400 direct and 480 indirect jobs in the construction sector over the life of the initiative.
Finally, I would like to emphasise the point that the impact of the Jobs Initiative, as specified on announcement day, will be budgetary neutral.
317. Deputy Terence Flanagan asked the Minister for Finance when the pension levy will cease; and if he will make a statement on the matter. [17126/13]
View answerIn my Budget 2013 speech, I made a point of confirming that the pension levy announced as part of the Jobs Initiative will not be renewed after 2014.
318. Deputy Terence Flanagan asked the Minister for Finance the amount that has been collected to date by the pension levy; and if he will make a statement on the matter. [17127/13]
View answerI am informed by the Revenue Commissioners that receipts to date from the temporary 0.6% stamp duty levy on pension fund assets introduced in the Finance (No. 2) Act 2011 amounted to €463 million in 2011 and €483 million in 2012. This is broadly in line with the amounts anticipated to be collected in those years. There is no yield from the levy as yet in respect of 2013. The deadline date for payment of the levy in 2013 is 25 September next.
319. Deputy Mary Lou McDonald asked the Minister for Finance his projected annual reduction in GDP growth arising from the proposed Croke Park II proposals to cut a further one billion euro from the public sector pay and pensions bill between July 2013 and June 2015. [17149/13]
View answerCroke Park II would represent another key milestone in returning the Irish economy to a sound fiscal footing. It is only by addressing our current fiscal imbalances that we will be able to return to sustainable economic growth and job creation. As the Deputy will be aware, there remains a considerable gap between revenue generated and expenditure. This situation is not sustainable over the longer term. In addition to the requirement to bring our deficit to under 3% of GDP by 2015 as per the Excessive Deficit Procedure, it makes sense that we bring balance back to the public finances and stabilise and reduce our debt burden. It should also be noted that while the necessary consolidation can have a negative short-run impact on economic output, the Government is pursuing fiscal consolidation in a manner that minimises the impact on the economy.
My Department will publish revised macroeconomic and fiscal forecasts at the end of this month as part of the Stability Programme Update 2013. These forecasts will take account of all developments, both domestic and international, since the Budget.
321. Deputy Michael McCarthy asked the Minister for Finance if the exceptional circumstances of a person (details supplied) in County Cork will be considered in terms of their property tax liability; if an exemption can be granted in this instance; and if he will make a statement on the matter. [17193/13]
View answerThe Finance (Local Property Tax) Act 2012 (as amended) sets out how the tax (LPT) is to be administered and provides for a number of specific exemptions from the charge. Chapter 14 of the Revenue booklet ‘ Your guide to Local Property Tax’ sets out in detail the various property types that are exempt from LPT. From the information provided by the Deputy, the person in question does not qualify for any exemption as provided for in the Act. If the person in question is concerned about his/her ability to pay LPT in a single payment then he/she may want to consider using one of the phased payment options that spreads payment in instalments across the year. The various payment options including phased cash payments and direct debit arrangements are detailed in ‘Chapter 11’ of the Revenue booklet ‘ Your guide to Local Property Tax’. For example, LPT can be deducted at source on a phased basis from salaries or occupational pensions or from certain payments from the Departments of Social Protection and Agriculture, Food and the Marine. The Revenue Commissioners advise that where deduction at source is chosen, there is no additional administration or interest charge. Payments can also be made by direct debit from current accounts in banks and other financial institutions including credit unions. Finally, liable persons can avail of phased payment facilities through third party payment service providers. This option does attract a transactional charge, which is levied by the service provider.
The Act also provides for circumstances whereby a person may opt to defer or partially defer payment of LPT where certain conditions are met. Chapter 12 of the Revenue booklet ‘ Your guide to Local Property Tax’ sets out in detail the various deferral types that are available. Revenue has also published extensive guidelines on the various types of deferrals, including examples, on its website www.revenue.ie.
The Deputy should note that deferral is not an exemption. Payment of the tax is deferred, meaning that it becomes payable later and carries an interest charge at a rate of 4% per annum on all amounts of LPT that are deferred. Any deferred amount, including interest, will be a charge on the property and will have to be paid to Revenue on the sale/transfer of the property.
322. Deputy Michael McGrath asked the Minister for Finance if the Revenue Commissioners will be able to adjust the tax credits of a person (details supplied) in County Cork in view of the ongoing arrangement they have with their employer. [17194/13]
View answerI am informed by the Revenue Commissioners that based on the information available to them, it is not possible to allow relief in the form of a Tax Credit. Such expenses can only be claimed on a review basis at the end of each year. The Revenue Commissioners will contact the individual directly to clarify any issues in relation to expenses in employment that he may have.
323. Deputy Aengus Ó Snodaigh asked the Minister for Finance if any relief or rebate from the local property tax is available for any property dwellers in estates or apartment complexes with management companies who are required to pay an annual management charge, who are responsible for street lighting, sewerage, road and paths and the general upkeep of the complex or estate, rather than the local authority and is charging such property dwellers the local property tax not a double tax. [17205/13]
View answerA requirement to pay management fees is not relevant in determining liability to Local Property Tax (LPT). There is no specific relief from the LPT for the payment of management fees, and I have no plans to introduce such a relief. Those who are liable for management fees to property management companies may be exempt or eligible for relief from LPT for another reason, or may be entitled to avail of a deferral arrangement under the provisions contained in the legislation. I am informed by the Revenue Commissioners that Local Property Tax (LPT) is a self-assessment tax so in the first instance it is a matter for the property owner to calculate the tax due based on his or her assessment of the market value of the property. Liability to management fees and the scale of the fees due would be one of the factors that a property owner would take into account in valuing their property.
Revenue from the Local Property Tax will accrue to local authorities and will support the provision of local services. Local authorities provide a broad range of services in the public realm which benefit the wider community and the proper functioning of which are important for the wellbeing of every community and household. These include fire and emergency services; road maintenance and cleaning; street lighting; spatial and development planning and other similar services; regulatory and inspection functions and business support services, as well as libraries, parks, and other recreation and cultural public amenities.
324. Deputy Michael McGrath asked the Minister for Finance if he will provide details of the process to be used by the special liquidator of Irish Bank Resolution Corporation in relation to the handling of individual debtor loan accounts; if the special liquidator is currently agreeing deals with debtors as part of the re-financing of certain loans; the procedure that will apply as regards the marketing of individual loans for sale on the open market; if individual debtors will be advised of the valuation that has been placed on their respective loans; when he expects the remaining unsold loans to be transferred to the National Asset Management Agency; and if he will make a statement on the matter. [17206/13]
View answerI have been advised that it is the intention of the Special Liquidators to package and sell the loan books as portfolios. The Special Liquidators are still in the process of devising and implementing the sales process in respect of IBRC’s assets and are therefore not in a position to write to borrowers with regards the disposal of their loans. There is an obligation on the Special Liquidators to ensure that maximum value is extracted from the loan sales process and they are currently devising a process to ensure they meet this obligation. The Special Liquidators are in the process of obtaining suitable independent professional advisors who shall employ standard valuation methodologies appropriate to each class of asset of IBRC. In order to ensure that maximum value is extracted through the liquidation process the Special Liquidators are required to keep confidential the valuation of these assets.
Following that independent valuation process, the Special Liquidators will sell the assets of IBRC (which are subject to the floating charge) in an open and transparent process at or above their independent valuation and failing that, the Special Liquidators will sell the assets to NAMA at their valuation price.
As the valuation and sales process is still being devised and implemented, the Deputy will appreciate that it is not possible to be specific in relation to the time horizon for the disposal of IBRC assets.
