Brian Lenihan Jnr (Dublin West, Fianna Fail)

As the Deputy is aware, in February of this year, the Government decided to pursue a general 8% reduction on fees to legal, medical, veterinary and other professionals engaged by the public service from 1 March 2009. My Department wrote to each Department outlining how this decision should be implemented.

I have informed this House previously that I have received advice in regard to the banking crisis from various sources, including the Attorney General's office, the Central Bank, the Financial Regulator and the NTMA. I have also received advice from Arthur Cox solicitors. The 8% reduction has been applied to fees paid to that company since March 2009.

The National Treasury Management Agency has engaged HSBC, Arthur Cox and PricewaterhouseCoopers to provide advice in regard to the National Asset Management Agency. In July 2009, the NTMA issued a tender to procure general banking advisers in regard to the whole financial system through the procurement website www.etenders.gov.ie and Rothschilds were awarded this mandate to 30 June 2010. I have been advised by the NTMA that all firms priced the work at a substantial discount - indeed, multiples of 8% - to win the business. I also understand from the NTMA that the agency-related tenders will use the public procurement website and any prices sought will be subject to the 8% reduction.

The Financial Regulator has advised me that it is operating in accordance with public sector requirements under the Financial Emergency Measures in the Public Interest Act 2009 when awarding any contract for the provision of professional and consultancy services to it. It is important that all sectors play a role tackling the serious problem of the deterioration in the public finances. The 8% reduction in professional, consultancy and other professional services are part of the overall savings package which the Government has announced.

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