Seán Fleming (Laois-Offaly, Fianna Fail) | Oireachtas source

I welcome the opportunity to raise the question of the financial bonds issued by the Irish Bank Resolution Corporation, IBRC, in respect of various building developments, particularly housing estates, throughout the country. Some of the estates in question are unfinished. A difficulty has arisen, in that, as a result of the emergency legislation passed by the Oireachtas earlier this year, IBRC has been put into special liquidation. We are only now learning of the legislation's impact on housing estates that have been left unfinished by developers who have gone to the wall.

Developers take out financial bonds to ensure that housing estates can be finished if they go out of business before the job is completed. Many insurance companies issue these bonds. All of the major companies have been involved. Some might have provided loans to developers or underwritten bonds. The difficulty lies in the fact that the bonds issued by the liquidated IBRC are not being paid. Instead, they have been placed at the bottom of the list.

Some local authorities face the impossible choice of leaving estates unfinished or taking money from other services to pay for finishing roads, footpaths, drainage, sewerage and street lighting in certain estates. The Minister was aware of this choice when introducing the legislation. I am aware of four housing estates in County Laois that have not been finished. In the normal course of events, the financial bond is called in when a builder is gone. I will cite a practical comparison from a few years ago when Quinn Insurance went into liquidation, that of large estates in County Laois, called Barrowvale and the Vale, in Graiguecullen near the Carlow boundary. Several hundred thousand euro was paid by the administrator on foot of that bond. Now that IBRC is in liquidation, however, it is telling local authorities to get lost and to join the bottom of the list of unsecured creditors.

The bonds issued by IBRC in respect of four estates in County Laois - Foxborough in Portlaoise, Graigavern in Ballybrittas, the Village in Ballylynan, which I am sure the Acting Chairman is aware of, and Radharc na Sleibhte in Mountrath - range from €87,000 to €354,000 in value. The works needed to complete those estates might not require the full bonds or might require more, but access to those bonds is necessary.

This situation is arising all over Ireland, as the Minister and the Department of the Environment, Community and Local Government know. More importantly, the Minister was aware of it when he drafted the legislation at this time last year. KPMG had been on site since last November. While the legislation sat in the Minister's top drawer last December waiting to be produced early this year, the Government introduced a local property tax. The Minister knew that the tax would be applied to certain housing estates in respect of which bonds would not be honoured as a result of an action he was about to take by liquidating IBRC in a few short months' time. However, he did not make it known at the time, causing further difficulty.

Will the Minister arrange for his Department and the Department of the Environment, Community and Local Government to supply a list of all of the estates affected by this issue on a county-by-county basis and the amount of bonds in issue so that we might have a reasonable understanding of the scale of the problem? Both Departments were aware of it, but it is only now coming to light at local level.

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