Dáil Éireann díospóireacht -
Wednesday, 24 Jun 2015

Vol. 884 No. 1

Leaders' Questions

Deputy Seán Ó Fearghaíl

It is accepted nationally and internationally that the scale of mortgage arrears continues to be a major problem, and is one that impedes our economic development and impacts socially on the lives of tens of thousands of people the length and breadth of the country. The Government's approach has been to introduce a mortgage arrears code of conduct in which it gave a veto to the banks. The alternative Fianna Fáil Party policy was to establish an independent mortgage resolution office, but the Government did not buy into that policy. Some considerable time later, we now see that the code of conduct for mortgage arrears is not working and is not serving the interests of borrowers.

A very interesting report was published today by the Central Bank. It examined the activities of seven lenders and found they are in breach of the code of conduct. Can the Taoiseach tell us what he is going to do about that? What actions will the Government take to ensure that the banks comply with the code of conduct? In the past the Minister for Finance, Deputy Michael Noonan, has said there are no sanctions that can be applied to banks if they do not co-operate with the code of conduct. Yet, those same banks are currently trying to recruit new mortgage holders. It is, therefore, in the interests of current mortgage holders that some penalties are applied to the banks which breach the code of conduct. It is also in the interests of those who draw down mortgages from these lenders to know the culture of the lender with which they will deal. Will the Government ensure that banks which have breached the code of conduct are named and shamed and that some penalty is imposed on them?

The Taoiseach

It is a good question. The Government set out its view on mortgages and the code of conduct some time ago. As the Deputy is aware, the Government recently made the decision to bring about further changes to the insolvency regime to deal with further facilities for mortgage holders.

It is utterly unacceptable that any lender would breach this code of conduct for mortgages.

Deputy Mattie McGrath

It is widespread.

The Taoiseach

The position is the Central Bank regulates the lenders. The Central Bank is now engaged in part of the process in which it delivers on independently of the Government. The code of conduct for mortgages is very clear and very fair in respect of those who are borrowers from any of the institutions. The Deputy asked what will happen next. The process is under way and this report comes from the Central Bank, which is the regulator. The Central Bank obviously has gone through examples of where the code has been breached by lenders. It is now the function and the responsibility of the Central Bank to set out whatever sanctions it desires to impose on these lenders.

Those sanctions will be publicly announced because it will be a public decision. It is not a case of the Minister for Finance setting out the sanctions. The regulator is the Central Bank. It conducted a report and identified breaches of the code of conduct by the lenders. It is very serious for borrowers affected to have this undue pressure put upon them. The next stage of the process is for the regulator, namely, the Central Bank, to set up the sanctions it intends to impose on those lenders in the first place. Those decisions will be publicly announced because it is public information.

Deputy Seán Ó Fearghaíl

Time is of the essence because the longer this matter is deferred, the deeper into arrears the people in question will get. People need solutions now. Will the Taoiseach give an indication of the timescale that is involved in the solution that he has put before us?

I am interested in the fact that the Central Bank stated there is a problem with seven lenders but it does not name them. I contend the public is entitled to know and that the public could then take action itself and make its own decisions had it that information. The Taoiseach and his Government gave the banks a veto in the insolvency legislation. Today, it would appear the Central Bank is giving further cover to the banking system by withholding this information. I understand the Central Bank Act provides for information to be disclosed where it is in the interest of the consumer. Is it not in the interest of the consumer that this information be put into the public realm? What timescale is the Taoiseach talking about before this happens?

Deputy Mattie McGrath

Stand up to the banks.

Deputy Seán Ó Fearghaíl

What is being done about local authorities which are also lenders and which, in my experience, are proving to be as ruthless in dealing with borrowers in difficulties as any of the banks? Who is overseeing the activities of local authorities as lenders which are forcing people out of their family homes?

The Taoiseach

The Central Bank has stated that it has sufficient powers to manage this process effectively. I hope the Central Bank, as the regulator, will deal with this matter publicly, swiftly and effectively. It has carried out examinations through its rigid inspection regime. There will be sanctions for any breaches in the code of conduct that have been identified. The sanctions and the institutions involved will be known. The inspection examined compliance under the resolution of arrears, transparency, fair process and the process of improvement and controls. I do not speak for the Central Bank but, following on from its own statement, it has the powers and the legitimacy to manage this effectively. I hope it will now do so swiftly, effectively and publicly because these are public decisions.

When personal insolvency practitioners made arrangements that were not acceptable to the banks, that is when a bank veto applied. The Government intends to change that and legislation is being prepared to that effect.

In respect of local authorities, was the Deputy referring to borrowing or cases involving repossession? The Minister for the Environment, Community and Local Government would be interested in examples of what the Deputy said about local authorities and the repayment of loans borrowed some time ago or where they are pursuing people for the non-payment of mortgage arrears. Clearly, the situation is being dealt with under the insolvency regime. This has to be amended now because of the actions of some of the banks and that legislation is being prepared to that effect.

Deputy Gerry Adams

Yesterday, the National Asset Management Agency, NAMA, lost a five-year battle at public expense to prevent details of its loans and properties being provided to the public. Why would NAMA want to prevent citizens knowing about its activities? Is it not unfair and unjust that the taxpayer might have to pay for NAMA’s effort to prevent the very same taxpayer knowing what the agency is doing, supposedly, in the name of the taxpayer?

NAMA has been shrouded in secrecy since its conception. It only became subject to the Freedom of Information Act last year, a development for which Sinn Féin campaigned and produced legislation. Billions of euro of public assets continue to be sold off by NAMA to vulture capitalists without any proper democratic oversight. Given the scandal at Irish Bank Resolution Corporation and the Government’s failure to protect the public interest, given the sell-off of Clerys and the Government’s refusal to legislate to protect workers and concession holders in that shop, surely there is an urgent need to look at how NAMA does its business? There are networks within networks of insiders and powerful vested interests behind many of these deals. Some of them are in NAMA but buying assets for themselves or for third parties. How is this allowed to happen? There is also concern NAMA is engaged in a fire sale of assets to meet an arbitrary deadline set by the troika and now being driven by the Minister of Finance, Deputy Michael Noonan.

Considering the public concern that now exists, will the Taoiseach agree to a suspension of non-contracted disposals activity at NAMA for a time-limited examination of the books with a view to ensuring the best interests of citizens are being served?

The Taoiseach

The troika has left.

Deputy Mattie McGrath

It has gone too far.

The Taoiseach

Many of the propositions it put forward were not acceptable to this Government.

Deputy Billy Kelleher

Which ones?

The Taoiseach

The Government put up alternatives that were pro-growth and pro-competitiveness in the interests of growing jobs and our economy, unlike what was left to us by the remnants of the Government-----

Deputy Mattie McGrath

The Government sold us a pup.

Deputy Billy Kelleher

We are coming up to the anniversary of the game changer of 29 June 2012.

The Taoiseach

Thank you, Deputy Kelleher.

Deputy Adams is well aware NAMA’s accounts are comprehensively audited by the Comptroller and Auditor General’s office which is entirely independent and objective, and I am sure he accepts that.

Deputy Billy Kelleher

The game changer was a huge breach of trust.

The Taoiseach

There is a permanent team of staff from the Comptroller and Auditor General’s office based in NAMA which has unrestricted access to all its records and files, including those relating to all transactions. If there is a concern about any aspect of NAMA’s work - the Deputy mentioned one earlier - it is within the power of the Comptroller and Auditor General to have it scrutinised and investigated.

The Comptroller and Auditor General has produced three special reports already on NAMA’s activities which have been broadly positive in their assessment of how the agency is managing the complex business of the extensive portfolio it acquired. Those reports were generally positive about the management of its business and its conduct.

All Comptroller and Auditor General’s reports on NAMA have been subject to the full scrutiny by the Committee of Public Accounts. These reports are available on the NAMA website for everyone to see. I understand the Comptroller and Auditor General will commence work shortly on his fourth special report on NAMA. In the sense of accountability and public transparency, the independent watchdog of the Dáil, namely, the Committee of Public Accounts, has considered these reports. The Comptroller and Auditor General has a permanent staff in NAMA with access to all files without restriction.

Three reports, broadly supportive of the work being done, have been published to date on the website and the fourth report has been commenced.

Deputy Gerry Adams

What the Taoiseach outlined happens after the fact. What I asked the Taoiseach to do, and he dodged the question, is to suspend non-contracted disposals activity for a time-limited examination of the books. Recently, the Dublin county board of the GAA failed in a bid to buy the Spawell centre from NAMA although it offered more than the €6.5 million asking price. Why would this be so? Cumann Lúthchleas Gael is an organisation of which we are all proud. Is this not the type of project that NAMA, a State agency, should facilitate? It did not, but it did facilitate Noel Smyth of Fitzwilliam Finance Partners. Noel Smyth was in NAMA's top 20 developers list. In 2013, he paid €230-----

An Ceann Comhairle

No, sorry Deputy this is not a place to be making charges we cannot stand over.

Deputy Gerry Adams

Sorry, Ceann Comhairle-----

An Ceann Comhairle

No, we have always had a tradition here that we do not name-----

Deputy Gerry Adams

I am not making a charge. I am stating what is on the public record.

An Ceann Comhairle

It is a tradition.

Deputy Gerry Adams

All right. In 2013, this person, whom I cannot name in this democratic forum but who is involved with a firm called Fitzwilliam Finance Partners, paid €230 million for loans owed by Arnotts and he secured 50% of the company. What this anonymous person has just done is a perfect example of someone acquiring assets while subject to NAMA, in this case from the IBRC. Last week, this anonymous person, whose name is in all of the newspapers but whom I am advised I cannot name-----

An Ceann Comhairle

You know what I mean.

Deputy Gerry Adams

-----bought the other 50% of Arnotts, so Noel Smyth, dare I say the name, now owns Arnotts. He controls Arnotts. What is to stop him from doing at Arnotts what was done at Clerys? It is perfectly legal under the Government's flawed legislation, and workers at Arnotts are understandably concerned about this and little wonder given how the legislation favours the elites and not the citizens. I do not suggest any impropriety here.

An Ceann Comhairle

Then what are we raising it for?

Deputy Aengus Ó Snodaigh

To show an example.

Deputy John Halligan

It can happen.

Deputy Gerry Adams

It is all legal. To ensure-----

An Ceann Comhairle

Of course you are implying-----

Deputy Gerry Adams

I wish the Ceann Comhairle would not interrupt my flow when I am asking a legitimate question.

Deputy Ray Butler

You cannot mention names.

Deputy Finian McGrath

Put Deputy Jerry Buttimer into NAMA.

An Ceann Comhairle

I am here to protect the citizens as well as the Members, and it is traditional that Members should not comment or criticise or make any charges against a person outside the House.

Deputy Ray Butler

It could be a perception job.

Deputy Aengus Ó Snodaigh

No charge was made.

An Ceann Comhairle

That is a long established principle in the Chamber.

Deputy Gerry Adams

I could not hear what the Ceann Comhairle said.

An Ceann Comhairle

As long as I am in this Chair that is the way it is going to be.

Deputy John Halligan

No charge was made.

An Ceann Comhairle

When I am gone from this Chair somebody else can-----

Deputy Gerry Adams

I could not hear what they Ceann Comhairle said because of the heckling.

An Ceann Comhairle

If the Deputy would like to come to me afterwards I will show him the established principle about naming people and making charges-----

Deputy Gerry Adams

I know what it is.

Deputy Paul Kehoe

Respect it then.

Deputy Gerry Adams

I am not entirely ignorant-----

An Ceann Comhairle

-----against people that imply wrongdoing.

Deputy Gerry Adams

I am not entirely ignorant of my responsibilities or of my entitlements-----

An Ceann Comhairle

I have to remind you from time to time when you choose to name people in the Chamber.

Deputy Gerry Adams

-----as a duly mandated Deputy. I made no charge. I asked the Taoiseach-----

An Ceann Comhairle

Then why are you naming the person?

Deputy Noel Grealish

Your colleague made a charge. She named people.

Deputy Gerry Adams

Because it is in the public interest to do so. I am asking the Taoiseach to ensure NAMA prioritises the interests of the citizens and the taxpayers. Will he establish an independent audit of remaining NAMA properties to determine which of these could be made available for social and economic development? I repeat my first question: will the Taoiseach agree to a suspension of non-contracted disposals activity for a time-limited examination given the public concern? These are issues of major public concern. Will the Taoiseach do these two things I am asking him to do?

The Taoiseach

I am not going to interfere in any way with the commission of investigation set up by the Oireachtas in respect of matters pertaining to IBRC.

Deputy Pádraig Mac Lochlainn

Oliver Callan will have you nailed next week.

The Taoiseach

As I said to the Deputy already, a dedicated number of staff from the Office of the Comptroller and Auditor General are in NAMA with unrestricted access to every file, every register and every transaction.

Deputy Gerry Adams

After the fact.

The Taoiseach

It is important that I appreciate the independence, objectivity and transparency of the Office of the Comptroller and Auditor General. I am sure the Deputy does as well. They are in there with NAMA as these transactions go through. The Comptroller and Auditor General as part of a special report on NAMA's progress from 2010 to 2012, following a review of NAMA disposals with a gross proceeds value of €1 billion, stated the evidence was that almost all property disposals had been sold through an open competitive process or with testing of disposal prices against market valuation and provided assurance that prices obtained were the best on offer in the market at the time a property was sold. For instance, No. 1 Warrington Place was sold following an open market competitive sale process. It attracted substantial investor interest. The property was advertised over an eight week period and there were 40 site inspections, 19 credible first round bids, eight parties invited to submit final bids on the basis of the strength of their first round bids and the asset was ultimately sold to the highest bidder after another bidder at the same price withdrew. This purchase was by a global investment fund, marking only a second ever acquisition in Europe. At the time it was the first sale of a major commercial building in Dublin for more than five years. International investor interest generated by the sale stayed in the Irish market and has contributed to the recovery which has been evident since.

I suggest to the Deputy that because of all of the interest being raised by Deputies from all sides of the House on matters relevant to NAMA, a particular facility was established for Members of the Oireachtas at [e-mail]-----

Deputy Gerry Adams

Will I toddle along to that?

The Taoiseach

Excuse me, where it invites the Deputy or any other Deputy who has an issue with NAMA to contact it through the facility.

Deputy Mattie McGrath

Pass the parcel.

Deputy Gerry Adams

I am asking the Taoiseach.

The Taoiseach

The Deputy has raised a point here. Test it and see the response he gets.

Deputy Gerry Adams

I have tested it with the Taoiseach and he has said "No".

Deputy Mattie McGrath

A treasure hunt.

The Taoiseach

I am sure the Deputy accepts the utter independence of the Office of the Comptroller and Auditor General. Three reports have been published, broadly very supportive of the activities here and-----

Deputy Aengus Ó Snodaigh

After the fact.

The Taoiseach

-----the fourth is under way.

Deputy Aengus Ó Snodaigh

It is too late.

The Taoiseach

There are personnel from the Office of the Comptroller and Auditor General in NAMA-----

Deputy Aengus Ó Snodaigh

The property deals have gone.

The Taoiseach

-----who have access to all of the files, registers and transactions. I know the Deputy does not expect me to interfere with the work of the commission of investigation being set up with regard to IBRC.

Deputy Maureen O'Sullivan

The issue I want to address today is Ireland's development aid policy, particularly because three international conferences are coming up between now and December. I acknowledge our aid programme and the work of Irish Aid and the NGOs and missionaries who work in very difficult circumstances and sometimes very dangerous situations. A recent report commissioned by Trócaire affirms Ireland's place as one of the best when it comes to aid because our aid is untied. Increasingly this untied aid is coming under threat because donor countries now want to benefit. We are seeing aid flowing through the private sector in the form of procurement contracts for goods and services, the vast majority for firms from rich countries. We are seeing self-interested development. This indicates a need for greater policy coherence to prevent human rights abuses and corruption.

The three conferences will be held in Addis Ababa on financing for development, in New York on sustainable development goals and in Geneva on climate change. Ireland will participate in all three and play a particular role in preparing and co-facilitating one of them. The conference in Addis Ababa on financing for development must produce a clear and comprehensive agreement. My question is on Ireland's role at that conference. There is a need for a senior Government figure to attend. While it is not a pledging conference, will we recommit to honouring the 0.7% of GDP and how we will do this by 2020? We could then be a voice for this commitment from other countries. Will Ireland support the calls for an intergovernmental tax body under the auspices of the UN which could really tackle tax evasion, tax avoidance and illicit tax flows all of which contribute to poverty and inequality? What is being proposed by the OECD will not address these needs. It is vital that the conference in Addis Ababa gets it right and Ireland can play a strong role there. If it does not get it right the other two conferences on sustainable development goals and climate change will be meaningless.

The Taoiseach

This is a very important issue that has been raised by the Deputy. As I understand it, the conference in Addis Ababa is really about pledging for funding, which will be an important element. It was raised with me by the chairman of the World Bank when he was here. The Minister of State at the Department of Jobs, Enterprise and Innovation, Deputy Sherlock, normally attends these occasions and, to be honest, I am unsure who is attending on behalf of the Government, although there will be a representative there in any event. The Uachtarán will attend the September meeting in New York and I expect to be there for a short period at that development goal conference. The third meeting, in Paris, is on climate change, and takes place in December.

Following the Pope's encyclical, there is a new impetus about this and what it means for countries. I hope the political process will respond, and I know that in our own case, as a small country, we would like to be able to have targets that we can actually achieve. We face a real challenge in this respect because the targets set for Ireland for 2020 were based, in my view, on inadequate evidence and scientific information in the first place. If the process continues from 2020 to 2030 on that basis, whatever Government represents our country in that period will be subject to enormous fines of €5.5 billion or €6 billion. We have consent from the European Council in respect of the agri-profile that we have here, which will allow us in some small way to be better able to compete towards achievable targets. Given the change in the economic position here over the past number of years, while Ireland was very much on track to achieve the required levels to contribute to those goals, the process has become somewhat stunted. It is obviously a matter that the Government can consider as we prepare for the October budget and decide how that can be best reflected.

I will see to it that we have a representative at the conference. If it is not Deputy Sherlock, it will be a senior representative - a Minister or Minister of State, if possible - who will go to Addis Ababa. The Uachtarán will attend in New York and I hope to be there as well. There is also the meeting in Paris dealing with issues to do with climate change. This is an important consideration and possibly worthy of a Dáil debate here at an appropriate time.

Deputy John Halligan

Well said.

The Taoiseach

I would be happy to accommodate all Deputies in that regard.

Deputy Maureen O'Sullivan

That is welcome, as the consequence if Ireland and other countries do not have a strong voice at Addis Ababa will be a continuation of the draining of phenomenal amounts of money from countries of the global south. This is because of financial flows, tax injustice and the cost of climate change. Financial transparency and accountability, which equates to country-by-country reporting, is vital. Globalisation has allowed the multinationals to dodge their tax obligations. Ireland can be a voice at Addis Ababa. It is welcome that the sustainable development goals will cover all countries, as there is certainly much unfinished business from the millennium development goals, which did not help those who are poorest, or women and children.

Climate change is the topic in Geneva, and the Taoiseach mentioned the Pope's Laudato si'. On Monday and Tuesday, there was a climate change conference in Maynooth. We know the relevant issues are pollution, waste and reduced biodiversity, which all contribute to climate change, which means that inequality and poverty will continue. My question referred to our climate change Bill, although it does not mention climate justice, which is so important. Nevertheless, in 2013, at the climate change conference hosted by the Government, the Government supported the principle of climate justice. I ask the Taoiseach to ensure that our climate change Bill will include the principle of climate justice, as otherwise we could be accused of hypocrisy; we would be saying one thing on the international stage but something very different nationally.

The Taoiseach

Pledges were made by countries before, in Copenhagen and other locations, that were not followed through on. The matter has moved on and the vast majority of governments are now acutely aware of their responsibilities. Certainly, at the European Council this issue comes up on a very regular basis, with clear priorities to be followed. That is why we have our own challenges to be faced here.

The Deputy mentioned pollution, waste and biodiversity. There are some extraordinary innovations in new technology to deal with elements of this, and the more that can happen the better. Some of those innovations have been pioneered in Ireland. The climate Bill did not set out specific targets because it goes as far as 2030 or 2050 and objectives were set out clearly. I do not object to having climate justice referred to in this matter. A former President, Dr. Mary Robinson, has been very vocal on this and I have spoken to her about her particular interest in the area.

Ireland will play its part as much as it can. We will contribute where we can and we must challenge ourselves in measuring up and being recognised as a country that really is fulfilling obligations in respect of climate change and the other elements of these three discussions. I will ask the Whip to make arrangements so that Members can have an opportunity to have their say on this in the House, and I hope that can happen before we leave for the summer recess.