Terence Flanagan
Ceist:127 Deputy Terence Flanagan asked the Minister for Finance his plans to reduce salaries being paid to National Asset Management Agency developers; and if he will make a statement on the matter. [33339/11]
Amharc ar fhreagraTuesday, 8 November 2011
Ceisteanna (121)
Freagraí scríofa
NAMA advises me that in many instances working with the people who know the business will secure a better return for the taxpayer. The Chairman of NAMA said some time ago that while foreclosing on all 850 developers and getting someone else to run the businesses would be the popular option, it would not make commercial sense. It is also the case that employing an external asset manager to manage the assets could cost significantly more than the cost of employing the original debtor. The fact that NAMA has had to take enforcement action in 91 cases so far shows that many developers consider NAMA's terms and conditions too onerous. It also shows that NAMA is not soft on developers in general and is looking to impose tough conditions. However, NAMA has also advised that where it decides to work with developers, the debtors must be given some incentive to work with NAMA.
I understand from NAMA that, as part of its business plan agreements with debtors, it normally looks for and obtains a reduction of 50% to 75% in overhead costs and that any remuneration paid to debtors is payable from this much-reduced budget. The Chairman of NAMA has recently stated that the majority of debtor remuneration packages fall into the €70,000 to €100,000 range, including all benefits-in-kind. He also confirmed that in two cases the debtor's remuneration package, authorised by NAMA as part of the budget for overheads, is €200,000. In these cases, I am advised by NAMA that these were considered essential to reaching an agreement that would generate a much better return to the taxpayer than the option of enforcement and the employment of asset managers for what are very large portfolios. NAMA will continue to make such decisions on a case-by-case basis in line with its commercial mandate.