Paul Murphy (Dublin South West, Anti-Austerity Alliance) | Oireachtas source

Yes. It is important that we discuss this legislation and that we do not just re-run old battles from the election about who was right about bank bailouts and so on. This is important legislation.

We accept and agree with the proposal from the Government in terms of the amendments because we want to see the Commission of Investigation empowered to do its work effectively and to get over the barriers identified by Judge Cregan as quickly as possible and, in particular, to allow it report as quickly as is possible on the question of the Siteserv transactions. An important point for discussion is why we need to make this change long after the establishment of the commission. The point was raised originally by the judge in November and we are now making this change. An article in The Sunday Times by journalist Brian Carey, raises the questions better than I could. It states:

For all the world, the inquiry into loan write-offs at IBRC looks like it was built to collapse: the towering edifice, the flimsy foundation, the complex material, the entirely infeasible completion deadline.

It ran out of control well before it was due to begin. By estimating a duration of several years, Judge Brian Cregan first rendered the whole prospect outrageous. It was the government’s decision to broaden the probe to 38 transactions and losses to the state bank of more than €10m. Now the government claims that an investigation could cost as much as a tribunal.

There were never grounds for a probe of that scope, depth, length of expense, nor was one ever demanded. And so the public's question for truth runs aground in a legal quagmire of confidentiality, privilege and enormous expenses. How convenient.

There were only ever a handful of questions that begged answers in this affair. Did Denis O'Brien, the most powerful businessman in the country, receive preferential treatment in his dealings with IBRC? Was he unduly favoured in his purchase of Siteserv, a utilities service company which was heavily indebted to the bank? Did he get preferential rates of interest on his own personal borrowings?

... KPMG could review, as suggested by Cregan, the top 12 write-offs, provided once again there is no conflict of interest. It is the job of a liquidator to investigate the affairs of a bust company. As yet, the evidence is not there to justify a wide-ranging, lengthy and expensive judicial inquiry. Frankly the public should be aghast that one should take place without at least establishing a case for such a probe.

By the same token, the Siteserv issue should not be buried with this administration. Right now, this looks like a manufactured botch job.

One could accuse him in normal circumstances of extreme cynicism and of believing in conspiracy theories, etc., in respect of believing that what we have here is a manufactured botch job. That certainly would be the case if we were to take seriously what the Minister outlined when he reiterated that the Government shares with the rest of the House a desire to ensure that there is an effective, efficient and timely investigation into the issues of significant public concern that have been raised in respect of IBRC.

The problem is that this statement does not tally with the actions of the Government, particularly those of the Minister for Finance. Far from establishing this commission of investigation in timely manner and giving it appropriate powers to do the work it had to do and certain terms of reference, this was dragged out of the Government kicking and screaming. Famously, we know that Deputy Catherine Murphy put 19 questions to the Minister and failed to get answers. We know that the Minister effectively engaged in deliberate attempts to bury the issue, claiming in answer to the 19 questions that there was nothing wrong with the Siteserv deal and that the board of IBRC was happy but never mentioning that his own Department had questions. We know he attended a meeting in July 2012 between the Department and the board of IBRC where the sale was discussed and the Department raised serious concerns about the way Siteserv was sold. The Minister had the opportunity at that stage to order an inquiry when he knew about the problems but he obviously did not do so. Over a number of weeks in the Dáil, we saw the Government under pressure and the KPMG investigation. Eventually, this was dragged out of them. The question raised by Brian Carey is not an unreasonable one.

The essence of the matter for us, which needs to be investigated as quickly and thoroughly as possible, is the Siteserv transaction. The consequences are that the taxpayer picked up a bill for €119 million. On the other side, Denis O'Brien effectively got a licence to print money through the imposition of water meters. The board of Siteserv was allowed to conduct the sale instead of IBRC, which was tasked with getting the best return for the State. We know that the board decided to exclude trade sales and instead entered into an exclusivity deal with one buyer, Denis O'Brien. We know that the board of Siteserv decided to reject higher bids for the company and that their shareholders got a €5 million payout for what was a bankrupt company. We also know that many of the directors of the company who conducted the sale were shareholders, that Arthur Cox acted for the buyer and the seller and that KPMG and Davy acted as advisers for the sale despite many of the Siteserv board having links to KPMG and many of the shareholders who got the €5 million being clients of Davy. Those are the central issues that need to be investigated. They are not that complicated in reality despite the previous stonewalling from the Minister.

Another issue relating to Siteserv that needs to be investigated, but obviously will not be investigated by this commission as it is outside the terms of reference, concerns the more fundamental point about why Denis O'Brien bought a bust company in a field in which he had no experience. Did he did so in the expectation that he would then be able to get the water metering contract as part of GMC Sierra? That is not included here because it is limited to the question of the write-offs in terms of IBRC, but it is an important part of the story. There are obviously two parts of that story. We know that Bord Gáis, which was responsible for the decision on water meters, told the Government that it was unnecessary to install the meters before the charges came in. Nonetheless, the Minister responsible at the time, Phil Hogan, decided to push ahead with the water metering. We also know a number of meetings happened behind closed doors, including two that involved the former Minister. We know that on 26 April 2015, Mike Aynsley said that the existence of the water metering tender was known, as was the likelihood of Siteserv bidding and the knowledge that, should it be successful, the value of the company would be enhanced. On 24 April 2015, Alan Dukes said that the sale took place over two years before there was any discussion of a public contract for the installation of water charges, so there are further questions to be asked there.

The fundamental point is that what has happened here is not victimless, nor is it winner-less. There are people who won from this series of transactions. The Siteserv shareholders, Denis O'Brien and the firms that were paid fees to oversee the process benefited while the public was the loser. It goes the heart of how Irish capitalism operates, which is why it is a sensitive issue from the perspective of the Government, particularly Irish capitalism in the so-called post-bailout environment, where write-offs have come to the fore as a mechanism for a transfer of public wealth to private individuals. In particular, it raises the issue of Denis O'Brien and his relationship with the media and politics and what this demonstrates about how society operates - how the 1% works in practice. This commission has the potential to unveil aspects of how this relationship works and how people are able to make substantial amounts of money. We need to look at that.

It also involves an individual who is extremely litigious and who has used legal action or the threat of legal action against the Dáil to prevent it from discussing certain matters, against media outlets that attempted to report, in line with the Constitution, utterances made in the Dáil, and against the satirical website Waterford Whispersfor a joke. It is clearly an attempt to chill discussion in public and the media so that these things are not discussed and do not come out.

My final general point is about winners, losers and write-offs. It is relevant in terms of the points made by Deputy Donnelly yesterday. We have had massive bailouts at a cost to the taxpayer, with IBRC resulting from that. In effect, a second round of bailouts are taking place. There have been transfers of wealth to certain private individuals by the State through the mechanism of write-offs. The Minister said that write-offs are a normal part of doing business. That speaks to the reality of Irish society and how it functions for the top 1%, for whom write-offs are a normal part of doing business. However, if we look at struggling mortgage holders who cannot afford to pay their mortgages, we can see that write-offs are not a normal part of their lives. They cannot get access to write-offs, so the point is that it is a case of write-offs for the elite - the 1% - but no write-offs for the rest. It is a mechanism for a transfer of wealth upwards, which is why we see the kind of accumulation of wealth we have seen over the course of the crisis. The top 300 people increased their wealth by about 60%, while Denis O'Brien doubled his wealth over the course of the crisis. It is precisely through mechanisms such as this that they are able to achieve that.

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