Mr. John Flynn:

The anti-competitive tax regime is one challenge. The two main challenges we face are the tax issues we have outlined and the availability of private sector financing from the pension fund industry. That is a key issue that we need to get over to match money from the public sector markets.

The pension fund industry is undergoing change and is under pressure because most defined benefit schemes are being moved to defined contribution schemes. As a result, the investment managers in these schemes have less autonomy to make investment decisions and within the defined contribution scheme there is also a requirement to have liquidity so that people who own these pensions can sell in and out. One of the drawbacks of our asset class is that it does not provide for a very liquid movement. Hence we recommend putting some support systems in place to improve people’s ability to sell in and out of a pooled resource. That would enable defined contribution schemes, which are the larger market pension schemes, to consider investments in this asset class.

Mr. Horgan referred to the debt feature. The key asset of companies at this stage in their life cycle is intellectual property, their people, their idea and approach to the market, which are predominantly financed by equity funding rather than debt.