Tony Killeen (Clare, Fianna Fail)

To the best of my recollection, for a period of 40 years or some very long period, the company projected a necessity of €600 million or €700 million - some quite large amount - which would have reflected all of the projects which may be viable on Coillte property coming to fruition, almost exclusively financed by Coillte and into operation in a short time period.

When I examined the reality of the projects concerned, it was clear that a much longer timeframe is involved for the development of a considerable number of the projects. It was also clear that strategic partnerships with companies in the business, including another semi-State company, the ESB, removes some of the need for some of that borrowing by Coillte or its subsidiaries. In some instances, it was at least worth examining the option of realising the value of the site rather than investing directly in it. For a variety of reasons associated with that type of consideration, my view is that €400 million is sufficient in the immediate term.

Regarding section 24(2) of the Forestry Act 1988 and the amendment proposed by the Deputy, the position is that Coillte may borrow money temporarily with the approval of the two Ministers, as I stated. The proposal in the amendment is to limit the amount for which Coillte may seek approval under this provision and also require the express approval of Dáil Éireann.

If we were to amend section 24(1), it would, in fact, allow Coillte to seek approval to borrow up to €400 million. The amount of the increase received much consideration and it was concluded, as I explained, that €400 million would be an adequate level in the medium term. There was a certain amount of head room for contingencies and it is not envisaged that this proposed level would be sought in the immediate future. It is also envisaged that Coillte would not need recourse to temporary borrowings as the overall limit will have been increased.

Temporary borrowings under section 24(2) must be approved by the Minister, as I stated, with the consent of the Minister for Finance. If the purpose of the amendment is to impose controls on temporary borrowings, it should be noted that such approval would only be given on the basis of a sound business case submitted by Coillte, which would receive in-depth consideration in both Departments. The level of borrowing is monitored on an ongoing basis and it is notified to the two Departments on a monthly basis, which is probably more frequently than Deputies might realise.

In view of these controls, to require the express approval of the Dáil could be regarded as unnecessary as it was considered that commercial State bodies would manage the enterprise or business assigned to them with appropriate levels of control and oversight provided in governing legislation. This is strengthened, in my view, by the obligations in the code of practice, as amended earlier this year.

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