Written Answers Nos. 74-80
74. Deputy Michael McGrath asked the Minister for Finance the total nominal value of bonds in Anglo Irish Bank and Irish Nationwide Building Society subject to liability management exercises in each year from 2008 to 2012; the average discount which applied in each case; and if he will make a statement on the matter. [47683/14]
View answerIn 2009 and 2010 Anglo Irish Bank repurchased subordinated bonds with a nominal value of €4.4bn and recognised gains as a result of these liability management exercises totalling €3.3bn.
Irish Nationwide Building Society in 2009 and 2011 exchanged or repurchased bonds totalling €1.1bn as part of liability management exercises and recognised gains of €0.4bn.
75. Deputy Michael McGrath asked the Minister for Finance the benefits to Ireland that would arise from a programme of quantitative easing by the European Central Bank; and if he will make a statement on the matter. [47684/14]
View answerIn general, a programme of quantitative easing (QE) would be expected to lower borrowing costs and increase the supply of credit to the real economy. In this way, real economic activity in the euro area would be expected to increase and inflation in the euro area as a whole would move back towards target.
The Irish economy would therefore benefit from both the reduction in borrowing costs and the improvement in activity in key export markets. In addition, QE would probably be associated with a depreciation of the euro, which would benefit exports to outside the euro area.
76. Deputy Michael McGrath asked the Minister for Finance if he will publish his Department’s submission to the Central Bank of Ireland on the subject of macro-prudential policy for residential mortgage lending; and if he will make a statement on the matter. [47685/14]
View answerMy Department recently made a submission to the Central Bank of Ireland regarding its macro-prudential proposals for mortgage lending. This submission has now been published on the Department's website and is available at:
http://www.finance.gov.ie/what-we-do/banking-financial-services/publications/reports-research/submission-department-finance
The Deputy may wish to note that it is also the intention of the Central Bank of Ireland to publish all the submissions it has received in response to the public consultation process on these macro prudential proposals.
77. Deputy Michael McGrath asked the Minister for Finance if he will issue a public tender for advisers regarding any future sale of AIB; and if he will make a statement on the matter. [47687/14]
View answerAs the Deputy will be aware, now that the bank has returned to profit, is on a stable path and has passed the ECB's Comprehensive Assessment, my officials intend to engage with the management team to explore how we can reconfigure the bank's capital structure to make it fit for purpose as the regulatory rules and expectations have changed dramatically in the past couple of years. We therefore need to lay out a plan to position the bank for this new environment. As part of this process we hope to agree a roadmap that will see the bank start to return cash to the State so we begin the process of repaying the taxpayers large investment.
Given this, we are not making any decisions around reducing our ownership in the bank at this stage. If we can deliver on the capital structure work programme next year and everything else develops as we would like, then we may be at the point where we can consider selling some of our shares.
In light of the size and importance of our AIB investments, we expect to have financial advisors in place early in 2015 to assist us with our decision making around the bank's capital structure.
In anticipation of the need for advice in relation to our banking investments and indeed to cover other ad hoc assignments which arise, my Department engaged in a process earlier this year that was is in line with the Open Procedure of EU Procurement Legislation and appointed three panels of financial advisers. These panels cover a wide range of financial disciplines including accounting, actuarial, investment banking and corporate finance. The results of this process were published on my Department's website on the 3rd of October 2014 and further details can be found at http://www.finance.gov.ie/news-centre/press-releases/advisory-panels-financial-matters
We recently invited all the firms in "Panel/Lot One" which covers Capital Markets, Strategic, M&A and Restructuring Advice to participate in a further, more streamlined and tailored, tender process relating to AIB. This process is underway and is expected to be completed in the coming weeks.
78. Deputy Michael McGrath asked the Minister for Finance the way the proceeds from the various sales by the State of its investment in Bank of Ireland has been invested or spent to date; if the proceeds will be available for investment by the Ireland Strategic Investment Fund; and if he will make a statement on the matter. [47688/14]
View answerSince 2009, the Minister for Finance has directed the NPRF Commission to invest €4.7bn in Bank of Ireland. Since the first investment was made, €4.2 billion of dividends and sale proceeds has been received from these investments; €1.3bn of the proceeds has been transferred to the NPRF Discretionary Portfolio (and will be available for investment by the Ireland Strategic Investment Fund when that fund is constituted), €1.0bn has been remitted to the exchequer and the remaining €1.9bn is held in cash in the NPRF Directed Portfolio. Of this latter sum, €10million has been directed for investment as equity in the Strategic Banking Corporation of Ireland (SBCI) with a further €240 million earmarked as a loan facility to the SBCI. These investments and disposals were made under direction from the Minister for Finance.
In relation to proceeds that remain under the direction of the Minister of Finance, the National Treasury Management Agency (Amendment) Act 2014, when fully commenced, will permit the Minister for Finance to direct that such proceeds be fully or partly paid to the Exchequer or invested in Irish Government securities, or held pending payment to the Exchequer or investment in Irish Government securities.
79. Deputy Michael McGrath asked the Minister for Finance the implications for the pension fund levy of 0.15% that applies in 2014 and 2015 from the proceeded settlement with a company's pensioners (details supplied); and if he will make a statement on the matter. [47689/14]
View answerIn Budget 2014 and in the Finance (No 2) Act 2013, I introduced an additional levy on pension funds at 0.15% for 2014 and 2015 to help fund the Jobs Initiative and to make provision for potential State liabilities emerging from pre-existing or future pension fund difficulties. The yield from the additional levy in these years forms part of general tax revenue of the Central Fund and is not hypothecated to any particular or specific item of expenditure.
A case linked to the details supplied with the question is currently before the High Court and is scheduled for hearing in January 2015. In the meantime, whilst my colleague, the Tánaiste and Minister for Social Protection, Ms Joan Burton, has made me aware of progress made in efforts to mediate a solution, as all parties involved have not yet had an opportunity to consider proposals, it would not be appropriate to comment further on matters arising in relation to the particular pension schemes.
80. Deputy Michael McGrath asked the Minister for Finance the reason for the delay in extending betting duty to online activity; and if he will make a statement on the matter. [47690/14]
View answerThe Betting (Amendment) Bill 2013 provides the regulatory framework for remote betting operators and when enacted will allow for the taxation of remote operators thus levelling the playing field with traditional bookmakers.
The Betting (Amendment) Bill 2013 has been the subject of a number of delays. The Bill was first published in July 2012 but further work was required around the area of prosecution and enforcement. The Bill was then republished in July 2013 given the resulting significant changes. On publication, the Bill entered a standstill period of 3 months under the EU Technical Standards Directive.
The Bill was amended at Committee Stage in the Dáil to allow the Revenue Commissioners to take on the functions ascribed to the Minister for Justice around compliance. The advice from the Attorney General's office was that these amendments constituted a substantial policy change and accordingly had to be notified under the EU Technical Standards Directive. This notification gave rise to a further standstill period of 3 months from June to September 2014.
At the end of this period, the Department received a Detailed Opinion from the Commission around "blocking" measures concerning provisions in the Bill that service providers will not provide services to unlicensed remote operators. The Commission's Detailed Opinion necessitated an extension of the standstill period of one month, up until end October 2014. Subsequently, an intervention by Malta under the EU Technical Services Directive has further extended the standstill period until 5th January 2015. Malta has expressed an opinion concerning the same "blocking" issue raised by the Commission and has also raised concerns at the prohibition on any person, who may be licensed by another jurisdiction, from offering betting services to persons within the Republic, unless they hold a licence issued by the competent authority in Ireland. Detailed responses has been provided to both these communications.
As soon as the standstill period is completed, it is my intention to progress all remaining stages of the Bill through the Oireachtas. I share the Deputy's frustration at the delays involved in progressing the Bill, however, it is necessary to follow all relevant procedures set out under the EU Technical Standards Directive.
