Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Prices set in the public sector-----

Richard Bruton (Dublin North Central, Fine Gael)
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We are back to the same question again.

Kieran O'Donnell (Limerick East, Fine Gael)
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I am getting a sense of déjÀ vu.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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We had a few hours of this on Thursday evening.

Richard Bruton (Dublin North Central, Fine Gael)
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We have heard this three times.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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This is a succinct reply, so the Deputy might get a few supplementary questions in. I published the draft NAMA business plan, which was prepared by the interim NAMA management, to inform the debate on NAMA. It is clear from its title that it is a draft report. The actual business plan cannot be initiated until NAMA is established and a board is appointed. The function of the Comptroller and Auditor General is to review performance, to audit expenditure and to report on the accounts of public bodies. The suggestion that he should be involved in a review of the draft business plan is misguided. I do not see a role for him in the review of the NAMA business plan.

Richard Bruton (Dublin North Central, Fine Gael)
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Given that just 6% of the land and development bank is performing, whereas the business plan forecasts that 80% of it will produce a full refund, can the Minister understand the scepticism of some people? Similarly, does he understand why people are dubious about the use of a risk discount rate of just 5% for highly risky projects, not to mention the expectation that the administration costs of this operation will be just 0.4%? In light of such dubious assumptions, will the Minister agree that someone should vet the soundness of this plan on behalf of the taxpayer? If he does not believe the Comptroller and Auditor General should perform such a function, who does he believe should be responsible for protecting taxpayers from rushing into decisions without a proper foundation?

Joan Burton (Dublin West, Labour)
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With regard to the power of the Comptroller and Auditor General to institute value for money reports, a series of changes have taken place since the draft NAMA business plan was prepared. Property values have continued to fall. We have received information from various court cases and legal actions. We have learnt that the value of the Irish Glass Bottle site in Ringsend has decreased stupendously from over €400 million, at the last count, to between €60 million and €80 million at present. The draft NAMA business plan does not provide for any such falls in value. The Minister is trying to make savings on the ordinary budget. Does he agree he should try to cut the €54 billion cost that the taxpayer is undertaking? Does he accept that it would make sound business sense, in the national economic interest, to do so now?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The valuations that will be reached, under the separate and independent valuation procedure that is envisaged in the Bill, will establish whether Deputy Burton is correct. The 5% discount rate in the draft business plan, which was mentioned by Deputy Bruton, is based on the current cost to the Government of funding ten-year bonds. This is an appropriate discount rate as the term of NAMA is expected to be approximately ten years. Private investors enjoy higher discounts that are linked to returns over shorter periods. I accept that the valuations used by NAMA will have regard to the discount rates in the private sector, when appropriate. I was also asked about the breakdown of the discounts. Deputy Burton referred to a particular case. It has to be said that a substantial discount is already factored into the draft business plan. The yield assumptions in the plan assume a fall of 40% in commercial rents for new leases. The yield figures already assume a 20% fall in rents and a 50% fall in property values.

Joan Burton (Dublin West, Labour)
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There already has been a catastrophic fall in the value of the Irish Glass Bottle site.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The business plan proceeds on the assumption that this fall will continue.