Damien English (Meath West, Fine Gael)

I am glad to have an opportunity to talk on this Bill because it is probably one of the most serious pieces of legislation we will ever discuss in Dáil Éireann. Apart from what went on today, which is a strange occurrence and something that has to be dealt with as soon as possible, the NAMA situation is very serious, and I do not believe it is being dealt with as it should be. We are not being given the right information.

My first concern is the book value of the loans. I do not believe that the banks do not know the exact amount of the debt nor that Minister does not know the exact amount. It was baloney to come in to this House, as the Minister did a couple of weeks ago, with estimates of potentially $77 billion or maybe €60 billion because they know the true extent of the situation. Last October, 12 months ago, there were committee meetings here where the Regulator and his staff told us they were starting to go into every bank to look at every loan and do their sums. It does not take 12 months to put a portfolio of loans together and add them up. If I have to get the Minister an abacus I shall do so, but he should not tell us, with regard to something as serious as this, that 12 months on, he is working on estimated figures. That is unbelievable. It cannot be true and needs to be corrected before we vote on this.

Also last October we were told by the Regulator and his staff that developer debts and so on came to €39.4 billion. On the night of the so-called mini-budget, some months ago, on the announcement of NAMA, we were told it was €80 billion or €90 billion. I asked then, and I shall ask again today, how, in God's name, did it increase from €39.4 billion to €80 billion in less than six months? We got half an explanation from the Green Party Minister the day after the mini-budget, to the effect that this involved overseas property of €20 billion or €30 billion. Again, I do not believe that, so somebody misled us. Either it was the Regulator and his staff last October, or the Minister is doing it here.

On the night of the budget I repeatedly asked the Taoiseach, the Ceann Comhairle and the Minister for Finance to clarify the figure of €80 billion to €90 billion but they have yet to do so. They never came back to me despite assurances and reassurances that they would check it out. It never happened, yet we are being asked to vote on something such as NAMA. If it is €40 billion and €30 billion of Irish developers' debts in other countries, why are we even considering taking up such property debts in the US, France, England and so on? Whatever about the small merit there might be in having some type of NAMA for the Irish element, we should not be buying up the property debts that belong to Irish people in other countries. That is fundamentally wrong and I want the Ceann Comhairle or the Acting Chairman, Deputy O'Connor, to know that I want this clarified — indeed, he might be Ceann Comhairle shortly enough.

We are told that some of these loans will pay for themselves, and the Government will be able to pay for the cost of NAMA on a yearly basis out of the interest it collects. Are we missing the point? Some €9 billion is already owed in interest that has not been collected. This group of loans are not paying for themselves. Already they are €9 billion behind. Why does the Minister believe that as of November, these people will start to pay their interest? They will not and they cannot because they have been unable to do it for the last year. If the banks cannot get their money I do not see how the Government believes it is going to get it because it is not available.

We are told that the loan to value ratio is an average 70%. Again, I cannot accept that it is an estimate and an average figure, 12 months down the line. The situation is probably much worse. I believe many of these loans have a loan to value ratio of 120%, 130% or 140%, certainly at the present value levels. If the loan debt is €68 billion and the estimates are €48 billion or thereabouts, we are now at a loan to value ratio of 140%. The Minister is citing a 77% loan to value ratio on the previous valuation, but that is just to massage the figures to make them sound better. He should have inserted "now 140%" and let people realise exactly what they are buying into. That is, 140% on the Minister's figures, given that the valuation of the property is 50%. I want to deal with that now because it is not 50%.

The Minister must be some type of genius with mathematics that he can come up with this, rent yields and every other formula, to try to show it is 50% of the valuation. It is not 50%. We all know that on the open market it is 13%, 14% or in some good places, 20% for development property. Development property and land is completely different to someone's house or a usable asset. It is an empty field, and its valuation is certainly not 50%. Therefore it is wrong to mislead the people that it is because it is not. It is as simple as that and we should not be making decisions on false information.

Even before the current valuations developers had loans of 100% or 120%. Those people will not pay back their debts. The Minister gives the impression that we are going to go after all this debt, and I accept some of the €54 billion might be collected. However, many developers set up special interest companies when they were buying the land and separated themselves and their personal assets from the concerns which bought it. Before we vote on this Bill, I want the Minister to explain exactly how many of these property loans can be chased up. I have a suspicion that many developers cannot be touched because of their special interest companies. They will be let go and the developer will stay in the big house with the big car while the poor little fellow will be struggling to pay a €300,000 mortgage.

The Minister must know how many of these loans are to companies of a special nature, or to others. The unfortunate small local builder who put up his own house to borrow money will lose whereas the big guys, the special few who had all the legal and financial advice they could pay for over the good years, made sure to separate themselves. It is wrong of the Minister to give us the impression that he can hunt them down for their personal assets. I do not believe he can do so and I want the point clarified because it is not clarified as matters stand.

What was the Government's relationship with the regulator? Was the regulator acting independently of Government advice or were he and his staff of some 200 linking up with Government and doing as they were told. Something went seriously wrong and I can see the hand of Government evident within that. It needs to clarified by the Government that its hand was not in it. If it was not, so be it, but if the question is not clarified, I will have to assume the regulator was acting according to Government policy, not independently. He acted wrongly, which we know.

A previous speaker stated that people need to be punished and that the average taxpayer needs to see somebody being held accountable. There is no sign of this as yet. There was quick dawn raid on Anglo Irish Bank and that was the height of it. I am afraid to say it but we will probably never see anybody in handcuffs or being made to take responsibility, which is a great shame and will damage this country for a long time. Nonetheless, people will lose their houses next year and the following year because they cannot pay small debts, which is very wrong. I want to hear where we are going in that regard.

I want to deal with the issue of a capital gains tax of 80%. The Greens intend to fix all problems in one fell swoop but NAMA is not concerned with this issue. I accept there is room to increase capital gains tax, but not to 80%, because the whole country will come to a standstill, if it is not at one already. This Bill will not fix every planning problem of the past. The Greens in their lovely speeches on the Bill spoke mainly about planning. While planning must be fixed, it is not the problem of NAMA, which is concerned with financial planning and corruption. It should remain focused on that area.

Although I do not have time to examine it in detail, I want to put on record that the Fine Gael alternative to NAMA is workable. Despite the Minister's puzzled look concerning it, such a scheme has worked and is currently working in many other countries, and it should be considered. A NAMA-type structure in France cost the taxpayer there over €18 billion in losses. In Ireland, the taxpayer has a potential exposure of €54 billion and, while I accept the Minister's point that we will not lose €54 billion, the potential does exist. I believe many of the assets are much more toxic than we are being lead to believe.

What the Minister proposes, based on the information he has given us, is immoral and wrong. He does not care, however, because he will be out of politics when the real consequences are seen in 20 years. The Minister of State, Deputy Barry Andrews, and I might still be here, and our children will certainly be here, when we see the real cost of this. The issue is very serious. It should not be dealt with as it is being dealt with in the House, namely, using false information.

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