David Stanton (Cork East, Fine Gael)
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I move:

“That Dáil Éireann approves the draft Order entitled Commission of Investigation (Irish Bank Resolution Corporation) (Amendment) Order 2016, which was duly laid before the House on 14 July 2016”.

I wish to reiterate that the Government shares the strong determination of this House for an effective, efficient and timely investigation into the issues of significant public concern which have been raised about the IBRC.

This shared determination has underpinned the extensive consultations that the Government has had with the Opposition at all stages of the process. Before I go into detail of the draft order before the House today for approval, I would like to briefly recap on the circumstances that have led to the need for it.

The Commission of Investigation into Irish Bank Resolution Corporation was established by the Government on 16 June 2015, following approval of a draft order by both Houses of the Oireachtas. The commission’s terms of reference were developed by the Minister for Finance. However, following consultation with the Opposition, the Department of Finance was encompassed within the terms of reference. At that point, it was agreed that the Taoiseach would be the specified Minister under the Commissions of Investigation Act 2004.

Mr. Justice Cregan, sole member of the commission, submitted an interim report on 13 November 2015, which was subsequently published. The interim report raised a number of significant difficulties which had arisen in the course of the commission’s work, including in relation to its terms of reference.

The Taoiseach engaged in detailed consultations with the Opposition on the issues raised in the interim report, as well as further consultation with the commission itself. This process considered various options for proceeding, as well as certain risks and implications of each approach. Following those consultations, it was agreed to draft urgent legislation to address certain matters raised by the commission. Deputies will be aware that the Commission of Investigation (Irish Bank Resolution Corporation) Bill 2016, which provides for additional powers to be given to the commission, has completed its passage through this House.

It was also agreed in the course of consultations with the Opposition that changes would be made to the commission’s terms of reference. As the original terms of reference were included as a schedule in the order establishing the commission, an amendment order is required to change them. The draft order before the House today provides for the original terms of reference to be revoked and replaced by the revised terms of reference. Mr. Justice Cregan has been consulted extensively on these changes and has consented to them as required under section 6 (1) of the Commissions of Investigation Act 2004. In summary, it is now proposed to adopt a modular approach in which the commission would initially be asked to report on the Siteserv transaction, which has been extensively raised in the Oireachtas as a matter of significant public concern.

This would include the issue of share dealing as set out in paragraph 2(e) of the current draft terms of reference. In relation to interest rates, the commission will be asked to report on principles and policies within IBRC in respect of the setting of interest rates generally. In addition, at the request of the commission in its interim report and, in subsequent consultations, a number of essentially technical changes are being made to the terms of reference. Following consultation with the commission, a timeframe for reporting at end-2017 is envisaged, at a tentative cost of over €10 million. This represents a considerable commitment of taxpayers’ money but the consensus view in discussion with the Opposition was that it was necessary to ensure the investigation proceeds.

I believe that the changes to the commission’s terms of reference, taken together with the new legislation before the Seanad, provides a basis for an effective investigation. I commend the draft order to the House.

Dara Calleary (Mayo, Fianna Fail)
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We will be supporting the motion which implements the modular approach concentrating in the first instance on the Siteserv sale by the Commission of Investigation into the IBRC. The commission has encountered problems of legal and professional confidentiality that have impeded the completion of its work. This motion helps address those barriers and will aid the commission in issuing a report by the already delayed October 2016 deadline.

Serious questions, however, have to be asked again as to why these hurdles are being dealt with at the end of the commission's operation phase rather than at its establishment, which would have prevented the delays we have encountered. These new terms of reference must be watertight and must not be subject to further delays. It is vital to ensure the commission is now enabled legally and through resources to overcome legal constraints to expedite the publication of the final report and to meet the deadline.

Some weeks ago, I asked questions about the Siteserv controversy and do not intend to ask them again. I note, however, the most overused phrase in the Minister of State's remarks was consultation with the Opposition. I put it to him that one of the biggest symptoms of the dysfunction of the last Dáil was the steamrolling of any input from the Opposition into any legislation. This Bill is a symptom of that way of doing business. Concerns were raised by Deputy Catherine Murphy and others about the model proposed. Many of the difficulties encountered and the delays incurred were identified at the outset by Opposition voices but because they came from this side of the House they were steamrolled, ignored and the Government carried on as normal. That is why we are here putting Band Aids on the original legislation and that is why there have been delays. That has to stop. We cannot keep running in here to deal with bad legislation when the weakness were pointed out at the outset. I am not sure where new politics is or what its definition will be but surely that would be something it could achieve, that when the Opposition puts forward constructive suggestions and proposals, or an idea that something may not work, it is not ignored because it is the Opposition which does so. Had that been the case in the previous Dáil, we would not be here this evening. We support the motion to try to bring this important work to an end and shine a light on what happened.

Pearse Doherty (Donegal, Sinn Fein)
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It is now four years and three months since I first raised, through a parliamentary question, the write-downs of IBRC to certain individuals. At that time, I noted the €100 million write-off and the €4.96 million pay-off to the shareholders. Obviously, the write-down was in respect of Siteserv. It was within days of the transaction. The Minister's reply at that time was pathetic and it still is. In the normal political establishment response to any issue of potential corruption in the State, the Minister retreated into the old rhetoric of the IBRC operating at arm's length and the board and bank are satisfied with the bid. Political responsibility was shirked from day one. Here we are, more than four years later, still trying to get the truth, despite the work of people such as Deputy Catherine Murphy, in terms of digging, making freedom of information requests and including issues we and others have raised about this case. If all of that sounds familiar it is because it is a process being repeated before our eyes with the refusal to inquire into the National Asset Management Agency, NAMA, through a commission of investigation. Like the IBRC, NAMA's sale of its Northern loan book requires a commission of investigation. Last October Fianna Fáil was all in favour of this. This month it was against it. I am not sure what its position is this week. We will wait and see.

My party rejected the first attempt at setting up this commission of investigation under its terms of reference because it was a half-hearted attempt made under political pressure. Last November, the interim report proved us right. The commission was never empowered to do the job people expected it to do. That was not a failure of Mr. Justice Cregan but it was a political failure.

IBRC was set up to manage the accumulated debts of two banks that were mangled together to create it, Anglo Irish Bank and Irish Nationwide Building Society. One more infamous than the other for the damage they did to Ireland and to its economy. The debt of these banks, which were the worst of the worst, was never wound down, even though the bank was. That debt remains on our books. The past and present of IBRC remains an issue for the Irish people. We have to cut our cloth where we are. Siteserv is the most critical issue of public interest. That is why we support the adoption of the modular approach and, in particular, the focus on Siteserv as an element of that module. I note too the inclusion of the principles and policies regarding the setting of interest rates. There is no reason to believe the suspicions regarding Denis O'Brien's affairs with IBRC are an isolated case.

The legislation was passed here last week and should be seen in conjunction with this motion. A key element of that was the new powers for the Minister to direct special liquidators. I wonder if another liquidator had been appointed would this have been necessary. The idea that the auditors of Irish Nationwide Building Society were the appropriate people to oversee the special liquidation of IBRC is laughable. They have been paid €5 million to date for their work and yet the interim report, published last November, was a list of problems and objections they were creating.

I support the new terms of reference as offering some chance that the public interest will be satisfied about the truth of the Siteserv issue and the issue of the suspiciously low interest rates being offered by IBRC will also be revealed. The last time I spoke about the original terms of reference, I spoke about information I had received regarding the interest rates on the financial dealings being charged to Denis O'Brien. Since then, I have received further information on one of the IBRC's largest debtors, a developer who had debts almost to the sum of €0.5 billion with that financial institution.

The information I have received is that part of some of the debts he had with IBRC showed he received multimillion euro loans with interests rates as low as 0.71%.

Other documentation shows that in 2012, a loan of more than €80 million from IBRC had its interest rate nearly halved. This is a new attempt to fix a mess by an arrogant Government that never really wanted these issues examined. The commission deserves our support. It is in the overwhelming public interest to remain alive to this and want to see the issue resolved.

I fear that module one will be all we will ever see and that we will only see practices in regards to interest rates examined. We will never deal with the documentation I have on why IBRC cut an individual's interest rates by almost half on a loan of more than €80 million and why it charged an interest rate of less than 0.75% on a number of loans at a time when the bloody country was going through the worst austerity it has ever seen.

These are questions that the Irish people deserve to have answered. We will support the terms of reference as a start to getting answers.

Catherine Murphy (Kildare North, Social Democrats)
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If there is an emotion I feel in respect of this it is relief that we have legislation and, it is to be hoped, today or tomorrow, the terms of reference dealt with in advance of the recess, and that we can look forward to Mr. Justice Cregan carrying out the work he stated needed to be done last November in his first interim report. He told us that even with these pieces in place, it will still take until the end of next year to complete this module. A very large amount of work is involved and work had been ongoing up to now to narrow the focus. Clearly, the terms of reference have been narrowed substantially and the Siteserv module will be front-loaded. I share some of the concerns about further modules but we will wait and see what happens.

There is also a nod to a general report on the principles and policies within IBRC and interest rate setting. I would have liked to have seen a far more detailed investigation into the practical application of interest rates to specific borrowers but that is a matter for another day. It is not ideal but I hope the general report may lead to subsequent models of investigation delving deeper into the application of the various rates depending on individual cases. The freedom of information documents I received revealed that Department officials had serious concerns about the poor execution of some very large transactions. For example, Blackstone, an American company, was brought in to price and value assets. It was then allowed to purchase those assets. That kind of practice is incredible. Other transactions like Topaz also featured.

I am concerned that we have not yet managed to address the shortcomings in the regulation of the Irish Stock Exchange, despite my raising the matter throughout the establishment of the commission. There was a spike in share dealing in Siteserv in advance of its sale. Last Sunday, Colin Coyle's piece in The Sunday Timesonce again highlighted the flaws in the regulation of the Stock Exchange. My concerns revolved around the unusual share activity in Siteserv in the months and weeks leading up to the sale. According to Colin Coyle's piece, the Stock Exchange had noted the activity as suspicious and yet declined to refer it on to the Office of the Director of Corporate Enforcement.

The information held in the Stock Exchange is very deficient. When I asked the Stock Exchange to investigate, it sent me to the Office of the Director of Corporate Enforcement. I was then sent to the Central Bank and so on. It was a merry-go-round. I still have serious questions around that area on which serious work needs to be done. Such work may require legislation or an institution may need to be nominated to properly regulate the sector.

The terms of reference are very much directed at scoping out Siteserv as a bellwether in the context of the relationship and practices within IBRC and an attempt to get to the bottom of what the Department called decisions of questionable quality regarding a number of significant large transactions. I voted in favour of the terms of reference when they were put in front of us last year.

In hindsight, we should learn something about the scoping-out of inquiries in advance because clearly a very large piece of work is needed. I have read all three of the interim reports and a very large volume of material has to be examined. This is the first inquiry of its type that has dealt with the financial sector and I do not think it will be the last. We have to learn some lessons and narrow the focus in order that we get timely results.

I do not think we can have accountability if we do not have transparency. The parliamentary questions process, whereby Deputy Doherty, I and others received replies, was very deficient. There needs to be a game change in that area in terms of answering questions in a complete way. I trust that the Cregan commission will endeavour to provide answers in this model and into the future. I am sure the report and recommendations for further modules will have to be brought before the House when that work is complete. I wish the judge well. A sizeable amount of work will be done.

David Stanton (Cork East, Fine Gael)
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I thank all Deputies who made contributions to the short debate. It is evident that all Members of the House have a strong desire to ensure that the IBRC commission of investigation conducts an efficient, effective and timely investigation into important matters of public concern. As I mentioned at the outset of the debate, in its first interim report, the commission raised significant issues regarding its investigation and terms of reference.

Today's debate and the points made by Deputies largely reflect the constructive consultations that were engaging the Government and Opposition party leaders to address issues raised by the commission. The consultations that took place covered the commission's terms of reference and the legislative changes required and which are being dealt with in the Commission of Investigation (IBRC) Bill 2016, which has completed its passage through the House.

Following the necessary Dáil and Seanad resolutions, it is the intention of the Government to make the order changing the commission's terms of reference before the summer recess. The making of the Government order, in tandem with the enactment of primary legislation, will enable the IBRC commission of investigation to progress its work in a focused and coherent manner. It would not be appropriate for us today to, in any way, try to prejudice or pre-empt what the findings of the commission will be. These are matters that must be left to the commission alone.

The commission is entirely independent and its sole member, Mr. Justice Brian Cregan, is an eminent member of the Judiciary who is well qualified to carry out the task that has been assigned to him. In accordance with the statutory provisions set out in the Commissions of Investigation Act 2004, Mr. Justice Cregan will send his final report to the Taoiseach as a specified Minister under the Act responsible for certain administrative matters regarding the commission.

The report will be published by the Taoiseach as soon as possible after it is submitted to him, subject, of course, to the advice of the Attorney General and any legal issues arising. I look forward to the IBRC commission completing its work and considering its final report in detail in due course. I again thank all Deputies who contributed to the debate.