Pearse Doherty (Donegal South West, Sinn Fein)

I have two questions, one of which I have not posed before but I posed the other on Second Stage. First, I am curious as to where the figure originated of 65% of the claim being paid out to a maximum of €825,000. How was that percentage and value determined? What were the factors that led to a 65% figure being introduced in the legislation?

Second, I am concerned by section 3C which deals with companies that have more than 70% of their business in the State for over three years. According to the legislation, when companies go into liquidation they are treated equally whether they have 70% or less in the State. However, only companies that have 70% of their business in the State are covered when in administration.

For example, if I have a policy with a company that has 60% of its business in the State and someone else has a policy with a company that has more than 70% of its business in the State, and both companies fall into administration, am I put at more risk than the other person because I have decided to go with a company that has less than 70% of its business in the State? Apart from the individual, is the latter company itself in a more disadvantageous position because the fund will assist a company that has at least 70% of its customer base in the State, thus helping it to get over the hump when it is in administration? The fund will not, however, assist a company with 65% of its business in the State to get over the hump when it is in administration. I am sure there is a rationale as to why this provision is in the section. I understand that everybody is supported when in liquidation and I presume that is because policyholders are affected rather than the business. Can the Minister explain the rationale behind that? Are there any questions as to how that would be construed concerning State aid, or any similar questions that would be of concern?

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