Pat Rabbitte (Dublin South West, Labour)

I stand corrected and accept that.

It is interesting to draw attention to a couple of points in the EUROSTAT statement. It refers to the Minister's submission that real estate prices in Ireland will increase by 10% over the next ten years. It states: "EUROSTAT is not in a position to judge whether this condition in plausible, however the presence of market investors is reassuring (those providing 51% of the equity of the SPV)". There is something endearingly naïve about that. That it is reassured by 51% of €100 million given the scale of what we are talking about seems very puzzling. When I asked if this could mean Allied Irish Banks and Bank of Ireland could be subscribers for the private equity, the Minister answered bluntly this was not the case. I trust that is on the record. He stated the subscribers were more likely to include pension funds, for example.

Deputy Richard Bruton asked whether there would be a dividend paid in a year with no profits. Why would somebody want to invest in this vehicle? The only reason one would want to invest is for information given that the vehicle is to acquire and manage the loans in the largest property company in the world. It would be worthwhile putting up the money required to obtain the information that will be forthcoming. We need to test that a little further.

The EUROSTAT approval states: "The current market value is 15% lower than the LTEV [long-term economic value] but Irish authorities believe that under the current conditions the market values for properties are artificially low". I have difficulty with that assessment. The market value for property is the market value for property. Perhaps the Minister will turn out to be right. I hope he is. I hope the increase is more than 10%. It is interesting that EUROSTAT signs off the preliminary approval by saying:

This preliminary view of EUROSTAT is based on the information provided by the country authorities. If this information turns out to be incomplete, or the implementation of the operation differs in some way from the information presented, EUROSTAT reserves the right to reconsider its view.

It is a major development. I am not sure whether the Minister said he did not tell us about it because he was waiting for the EUROSTAT approval or that it had just come out a day or two before he made it available to us. I do not find that entirely reassuring in the sense that if it was always contemplated and this term "NAMA group entities" was meant to encompass a special purpose vehicle, SPV, or in this case the daddy of all special purpose vehicles, in fact the mother and father of special purpose vehicles, I would have thought that we ought to have been given a heads-up on that. What did the Minister propose to do if EUROSTAT turned it down?

I do not object in principle to the notion of the Minister trying to arrange the financing in a fashion that does not compromise the already extremely high national debt figures. I wish to make that clear, but I have difficulty with the way it has emerged. The points in the amendment that Deputy Bruton has adduced are immensely important. In the context of that question I asked the Minister about Bank of Ireland or Allied Irish Banks contriving to get us to shed their toxic assets and then they run the show, we need to look at the question of the suitability of investors as envisaged in line (a) of the amendment. The reference in line (b) to the suitability and behaviour of members of the board is just as important. This puts An Bord Pleanála, the National Roads Authority and other such bodies in the ha'penny place.

The Minister indicated to me on Committee Stage that he envisages the chairman of NAMA will be the chairman of the SPV but he never explained in detail how he can provide for all of that in the shareholder's agreement. A number of other matters arise in the amendment to which Deputies Bruton and Burton have spoken and I do not wish to go back over that but it is very important. If the reason that the Minister did not give tangible expression to this in the Bill when he first published it was because he did not have the approval from EUROSTAT, now that he has the approval why resist incorporating in the law the amendment tabled by Deputy Bruton or something like it?

See this speech in context