Pearse Doherty (Donegal South West, Sinn Fein) | Oireachtas source

Ba mhaith liom an leasú atá curtha chun tosaigh ag Páirtí Shinn Féin a mholadh anseo. Mar is eol don Aire, níl ár bpáirtí sásta leis na téarmaí tagartha atá leagtha síos ag an Rialtas ó thaobh an choimisiúin fhiosrúcháin seo, agus is mór an trua é sin i ndiaidh cúpla iarracht fá choinne an fhírinne a theacht amach. Chuala muid an Taoiseach ar dtús ag caint faoin Comptroller and Auditor General. Ansin bhí fiosrúchán againn taobh istigh den Teach seo, ansin le KPMG le cuidiú ón mbreitheamh agus anois leis an gcoimisiún fiosrúcháin seo, ag deireadh thiar thall, atá molta ag an Rialtas. Ach ar an drochuair, níl an Rialtas go fóill ag éisteacht le tuairimí agus moltaí an Fhreasúra, go háirithe Páirtí Shinn Féin. Is mór an trua nár éist an tAire leis an méid a bhí le rá ag an Teachta Mary Lou McDonald inné nuair a bhí sí ag caint leis fa dtaobh de na téarmaí tagartha don choimisiún seo.

Ach tá leasú curtha chun tosaigh againn agus tá súil againn go mbeidh muid ábalta cur i bhfeidhm ar an Rialtas, má tá sé le tacaíocht iomlán na Tithe seo agus tacaíocht iomlán an phobail a fháil, go gcaithfidh sé éisteacht leis an méid atá muid ag cur síos inár leasú.

For weeks now, this controversy has rumbled on, with the Government stumbling from poor decision to poor decision. We have seen an unprecedented legal position in which most of the State's media were afraid to report what a representative of the people said in Parliament. We have seen a Government in crisis failing to grasp the nettle time after time. We have seen an initial inside job, with KPMG in charge of the investigation, dropped after public anger forced the hand of the Minister and the Taoiseach. We have seen a blundering Taoiseach throwing out suggestions that were never practical or even legal, for example, asking the Comptroller and Auditor General to investigate these matters. Now we have this attempt to set up a new investigation. Unfortunately, the terms of reference fall short of what is necessary to win public support and the support of Sinn Féin.

Yesterday, Deputy Mary Lou McDonald told the Minister for Finance that it was critical that the investigation be empowered to examine the dealings at the Irish Bank Resolution Corporation, IBRC, following its liquidation in February 2013. We are disappointed that the Minister did not listen and has not included this matter in the terms of reference. Sinn Féin has tabled an amendment to the motion and we hope to convince the Minister, in the course of the debate, of the need to accept it in order that the commission of investigation will enjoy the full support of the House and members of the public and will get to the truth in all matters. My colleagues will outline in greater detail some of my party's concerns about the terms of reference of the commission of investigation and other matters. I will concentrate on the reason the terms of reference need to be extended beyond 7 February 2013.

Three years ago, I asked the Minister why IBRC agreed to write down the debts of Siteserv by €100 million while, at the same time, ordinary shareholders were paid €4.96 million as part of a deal to sell the company. The Minister replied that it was a matter for the board and management to determine and implement such policy in their organisation and commercial decisions regarding IBRC were solely a matter for the bank. Since then, Sinn Féin has asked hundreds of parliamentary questions relating to the establishment, actions and liquidation of IBRC and the appointment of the special liquidators from KPMG. I have with me a file containing the many parliamentary questions we have asked the Minister about issues of public concern. Unfortunately, the answers received from the Department did not provide satisfaction on many of these issues.

Sinn Féin stated from the outset that IBRC was no ordinary bank. The public funding received by its core elements - Anglo Irish Bank and Irish Nationwide Building Society - meant that citizens deserved answers on its operations. It has taken the Minister all of this time to accept what was obvious then and now, namely, that there is a public interest element to IBRC. Thanks to Deputy Catherine Murphy and her pursuit of freedom of information requests, we have before the House the terms of reference for a commission of inquiry into certain aspects of IBRC.

It is important to point out at this juncture that I am not making any allegations of wrongdoing or incompetent governance at IBRC. I have no wish to pre-empt or prejudge in any way the findings of the proposed inquiry. What we have at the moment are facts. There are things that we know took place, although the conclusions we may draw from them are for another day. This is about asking legitimate questions and the facts on the ground serve to inform those questions. In this regard, it is important that we know the facts and they are placed on record to help frame the terms of reference of the proposed investigation.

The sale of Siteserv has generated much commentary both inside and outside the House. Concerns have been raised regarding the payment to shareholders, the size of the write-down received and the apparent exclusion of other bidders. The issue of Siteserv is covered by the terms of reference, as laid before the House today, because the decision on Siteserv deals with possible losses during the relevant period. However, management decisions made during the tenure of the liquidators that could have bestowed certain advantages on individual borrowers are not covered by the terms of reference, as they currently stand, beyond 7 February 2013. For example, existing loans and the extension of such loans can also in some cases give rise to certain advantages for individual borrowers. I will explain what I mean by that. In the case of a person whose loan has expired, the bank can put a call on the loan, thus requiring the borrower to pay the loan in full. Failure to pay the loan, for whatever reason, allows the financial institution to access the assets which underpin or are secured against the loan, whether these assets are company shares, physical infrastructure or personal guarantees. Since the financial crisis of 2008, we have become all too aware that financial institutions have pursued this avenue, leaving many individuals bankrupt and stripped of their companies, sometimes down to the family home. However, these types of management decisions which were made – or not made as the case may be - under the tenure of IBRC will not be covered by the inquiry if they were taken after 7 February 2013.

The inquiry should not be solely about losses and interest rates but should also be about processes and relationships. The ability to have a decision deferred, a loan extended or terms changed and amended is an area that is open to the possibility of obtaining advantage. I propose to cite some examples that demonstrate the need to have managerial decisions and client relationships covered by the commission of inquiry beyond 7 February 2013. Only last week, IBRC board minutes released by the Department showed that Mr. Richard Woodhouse, who managed Mr. Denis O’Brien’s loans with IBRC, was present at meetings at which the sale of Siteserv was discussed. The former chairman of IBRC stated that Mr. Woodhouse played no part in the decision-making process around the sale of Siteserv.

In recent days, a series of documents has come into my possession which helps to give a more complete assessment of issues relating to IBRC, Siteserv and related matters. I will make these documents available to the Taoiseach with a request that he pass them on to the judge who is appointed to oversee the commission of investigation. They show that in 2012, Mr. Denis O'Brien, the eventual owner of Siteserv, had an agreement with IBRC whereby the bank "would receive 92.02% of all Digicel dividends in excess of 50 million dollars" as part of a loan repayment agreement. In the same year, Digicel made a one off dividend distribution of $300 million. IBRC received a scheduled payment of €150 million, which equated to 65% of the dividend distribution. The balance was then used by Mr. O'Brien to pay down a Bank of Ireland facility which had been used to fund the Siteserv deal. This step was approved by the IBRC's group credit committee. In other words, we know that IBRC sold Siteserv to Denis O'Brien and Mr. O'Brien had major loans with IBRC and, it seems, the terms of a loan agreement with IBRC were used to pay down the loan he received from Bank of Ireland to purchase Siteserv in the first instance.

Other documents that I have seen lead me to ask legitimate questions of the way IBRC was being run in the public interest. For example, I have seen letters and documents which outline details of Mr. O'Brien's loans with IBRC, with four different proposals for an extension of these loans. In a letter dated 7 March 2013, Mr. O'Brien requested approval for a proposal to repay his facilities over a three-year period with a schedule of capital repayments. The request was discussed by the case team with the special liquidators of IBRC and, on 17 March 2013, an e-mail was sent to Mr. O'Brien which advised that facilities could only be extended for up to 12 months and only then if it was considered beneficial to do so in the context of asset protection and enhancement. This was rejection No. 1 for Denis O'Brien.

On 26 April 2013, Mr. O'Brien requested formal approval to extend his facilities for 12 months to 30 June 2014 with no capital repayments.

On 20 May, the group credit committee approved a 12 month extension subject to a €100 million capital repayment on or before 30 November 2013. This was a de factosecond rejection of Denis O'Brien's proposals. On 21 June, the individual in question responded with a proposal for a one year extension on his loans with a capital repayment of €100 million in November 2013. This was rejected outright by the group credit committee on 4 July 2013. It was rejection No. 3. The loan facility had expired at this stage. With no new agreement in place and with his loan facility expired since 30 June 2013, it appears that Denis O'Brien faced the possibility of having his loan sold to a third party with no facility in place.

In August 2013, Denis O'Brien met with the case team and at this meeting the documents say he made it clear that he had a verbal agreement with Richard Woodhouse, who I mentioned previously in relation to the Siteserv deal, and with Michael Aynsley, which pre-dated the liquidation of IBRC. The documents say that Denis O'Brien said this verbal agreement allowed him to repay his loans over a three-year period beginning in 2012. It was his view, and the view of his lawyers, that this verbal agreement still stood even though the bank was now in liquidation. In September, Denis O'Brien and his advisers met with the special liquidator and made it clear that they would not commit to any capital repayment for a 12-month extension. The documents also say that Denis O'Brien made it known through his advisers that he was not prepared into enter the process of having his loans sold on with an expired loan facility and so was likely to issue protective legal proceedings seeking an order for specific performance which would require the bank to honour the alleged three-year term on his facilities.

Following these meetings and IBRC's views of the threats of legal action, Denis O'Brien made a fourth proposal to IBRC on 10 October 2013 for a 12-month extension with no capital repayments. This is the same proposal as the second proposal, which was rejected. According to the document I have, it was approved on 14 November 2013. This was for a loan in excess of €315 million with a margin interest rate of 3%, amounting to €10 million in interest per annum. The bank and special liquidators concluded that it was regrettable that it was not able to achieve consensual agreement from the borrower to maintain the expected repayment schedule by delivery of a further €100 million capital repayment given the impending loan sale and the bank's inability to extend the facility beyond 12 months.

These issues raise serious questions. How does a bank in liquidation extend a €315 million loan, which is the same thing as creating a new loan, which its group credit committee had rejected just a number of months earlier? Why did IBRC not place a call on the now expired loan? How did the verbal agreements between certain managers prior to liquidation outweigh the decision of the group credit committee? From documents I have seen, it appears that IBRC's former chief executive, Mike Aynsley, along with Richard Woodhouse, made a verbal agreement with Denis O'Brien to give him an additional three years to pay off his loans with the bank. This is the same Richard Woodhouse who was present during the discussion of the Siteserv sale. It is clear from the documents I have seen that Mr. O'Brien did not want his loans to be sold on to a third party but instead wanted a 12-month extension in order to work out the loan himself. Apart from Siteserv, all of this took place after 7 February 2013 and, as such, would not be covered by the terms of reference of the commission of investigation as presented by the Minister this evening to the House. This is just one example of why the terms of reference need to be expanded into the timeframe of the liquidation of IBRC. Let us be clear about it. This is a €315 million loan that was extended, which is the same as issuing a new loan on the basis of an apparent verbal agreement despite the rejection on three separate occasions by the group credit committee of a version of the same proposal. How is this not relevant to the inquiry? Nevertheless, it does not fall within the terms of reference. The Minister allows only for transactions that existed before the liquidation and which were executed afterwards. However, these management decisions are key.

There are many other areas that Sinn Féin has raised given concerns it has had over the years. These include: Blackstone; Blue Ocean; NAMA bonds; and Racing Post. I could talk to the Minister about the documents on Blue Ocean and I cannot understand the rationale behind the State not buying the NAMA bonds. The issue of the Racing Posthas appeared in the British and Irish media and I raised it in the House a number of weeks ago. We will argue strongly that these issues should be included in the terms of reference of the commission of investigation. Not once, not twice but three times the Minister has made a mess of this. The Minister, Taoiseach and Tánaiste should note that the public deserve answers. They demand a full and complete investigation. The Government has fumbled and stumbled to this point. Public pressure and the work of the Opposition has brought it this far, but we are not there yet. Given all that I have just said, it is clear why Sinn Féin's amendment is necessary. Let us get this right once and for all. The commission must be allowed look at deals and issues post the liquidation of IBRC. The public interest does not stop in February 2013. We are talking about billions of euro of the people's money. My party wants the whole story to come out. We cannot say at some arbitrary point that the story end here. We must look at the whole story and that means examining some of the issues I have raised today, which are beyond doubt in the public interest.

I call on the Minister to support my party's amendment and to let every transaction of public interest be brought into the light. What we have before us is not good enough and will not satisfy the people's right to know what happened to their money. I encourage the Minister to allow the terms of reference to go beyond the night of the liquidation of IBRC. I have outlined issues to convince the Minister that they are of public interest. There may be other issues that should be investigated and, as such, the date should be extended, as Sinn Féin proposes in its amendment, to March 2015.

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