Joe O'Toole (Independent)

I welcome the Minister of State, Deputy Mansergh. I begin by saying "ditto" to the points that have just been made by Senator MacSharry. I am sure the Minister of State is as aware as we are that this is an issue of grave concern to people. Even though it is different from NAMA, in the people's minds both issues are being discussed together in that they are saying we are doing everything for the bankers and asking what is being done for ordinary people. There is a political balance to be struck. I do not say it should form part of the NAMA legislation, that is not the point I make, but that ordinary people should see that something is being done. I welcome the fact that the Minister of State referred to the importance of public confidence in all that we are doing. The point Senator MacSharry has made is crucial to that and people need to understand that.

I am in favour of NAMA. I generally support the structure. I examined the genuine proposals made by Fine Gael to have a good bank and a bad bank, and the proposals of Labour to partially or temporarily nationalise the banks, but I could not drill down sufficiently into them to get to the point where they would be effective enough. They were thought out, in particular the Fine Gael proposal, but I do not think it met the case. I was able to grasp and go down through the different levels of NAMA and, while I cannot say it with the same confidence as the Minister of State's party, I believe it will work. I hope it will work. As I see it, it is the best of the three options and the better of the two between it and the Fine Gael proposal.

I compliment the Government on publishing the draft NAMA Bill. In broad terms I would like governments to take a lesson from that. The publication of that legislation in July, which in effect was an expanded heads of the Bill because there were so many gaps in it, allowed an extraordinary debate to take place. That is something that is very much lacking in our legislative process. The Minister of State will, in his former life in this House, have heard me say on Second Stage debates that I thought there was a need for a protracted discussion with interested parties. That is very important and sometimes it does not happen. What the publication of the draft Bill did was it allowed people to take it on holidays with them and talk to people on the ground. It also allowed a serious debate to take place. I was taken by the commentary Deputy Richard Bruton made on it, which was thoughtful and effective and raised issues. That is what it was about.

I wrote to the Minister at the time about a number of points that bothered me a great deal in the original Bill and a number of them have been taken on board. I could see in the writing of the draft Bill where there was not time to fill in the gaps in July, that a great deal was left to the Minister to intervene and be the final arbiter. I was horrified by that. In the latest version of the Bill that has, in effect, been addressed in almost all the areas about which I was concerned, such as, for example, in the evaluation process. In the main that approach has been removed from the Bill and there is a vast improvement in it.

The Minister of State referred to public confidence and transparency. He also mentioned the importance of the operating governance structure. I would like him to convince the Government that this is the same thing. Public confidence and operating governance structure are intertwined with each other. That was the problem with the Central Bank regulation, people did not feel that involvement there. This should be done from the outset.

One of the problems I have with the current National Asset Management Agency Bill is that I do not know, for instance, how the board will be appointed by the Minister. This is a classic example of where, in order to have public confidence in NAMA, we should have public confidence in the directors of NAMA and the members of the board in all cases. Some mention of that is made in the Bill but the Minister of State did not refer to it. It is clear that whether it is to be by advertisement and public appointment - I am not sure whether that would be appropriate - the people whom it is proposed to appoint to the board of NAMA or the board of the special purpose vehicle mentioned by the Minister for Finance in the Dáil this week should be invited to appear before a committee of the House, a joint committee, the Committee of Public Accounts or the oversight committee, to which the Minister of State and Senator MacSharry referred.

The establishment of such an oversight committee is extremely important. I want to be clear in this respect. I am not talking about the type of public grilling and embarrassment of people that goes on in Washington. I am talking about providing an opportunity for a person to come before a committee who would be asked about his or her knowledge, expertise and experience in this area. Such a person could say in response that he or she wants to be on the board of NAMA because he or she can bring something to it. I am not suggesting the committee should be entitled to overthrow a Government decision. I would not be in favour of that because, after all, this is the Government's responsibility. The Government must have the people it needs and wants on that board. There is not a conflict in this context. Such a committee would bring openness and transparency to this process and it would also give confidence to the people concerned. Knowing the Minister of State for who he is, I know he would not sit on a board if he did not believe he could contribute to it. It is people of that ilk who I would like to see on the board of NAMA or the board of a special purpose vehicle, people who would be inclined to say they would be delighted to come before a committee, not to be embarrassed or dealt with unfairly but to show a CV, show where they come from and the reason they can offer something. At least that would be on the record and reported, and that would be helpful.

The matter of how we will deal with the governance issue of the process should be taken further in the legislation. We need to know about the audit committee and finance committee of that board. I agree completely with the point being made by Fine Gael in the other House in regard to the proposed special purpose vehicle. I cannot understand the reason the State, or public sector, side of that vehicle would not have a majority interest of it. I understand the reason NAMA will have a veto over its decisions. I do not have a problem with the concept of a special purpose vehicle. It is a good idea. I have not heard any rationale as to why the public sector should not hold the balance of power in regard to that vehicle. That is an important consideration. However, I do not have enough information on it to argue about it.

We had a draft Bill and a protracted debate in the other House. The Minister may have given the wrong impression in this regard yesterday and, if he did it deliberately, I believe he is wrong. A protracted debate on the legislation in the other House is a good thing. I cannot understand how that will delay the work of NAMA. The Minister has said to me, privately and publicly, that NAMA is working away, getting all its ducks in a line and moving on with the work. I do not want the legislation rushed through this House in a few days, neither do I want its passage delayed. Its consideration should be expedient and efficient. However, I do not want the legislation rushed in on, say, a Friday afternoon to get it out on a Saturday evening. We should deal with it as a week's work or whatever period is required and go through it properly and effectively on that basis.

The accountability measures in the legislation are a major improvement on the draft Bill. The Minister of State mentioned the agency would submit reports to the Minister a number of times a year, which the Minister would then lay before the Houses. In addition to those measures, I would like there to be another layer of accountability in the form of an oversight group. A report was submitted in mid-summer. If the Minister of State knows the answer to the question I am about to ask, I know he would be not be prevented from disclosing it. When the original draft legislation was brought by Government memo to Cabinet, there was a proposal that the Minister should set up a committee made up of Deputies Bruton and Rabbitte and a few more to have an oversight role of the process, but the Government was not too keen about that. It made a mistake there. It would have been brilliant, politically, for it to do that. It is always good to bring people into the tent, so to speak. The setting up of an oversight body of some description would be beneficial. I am not talking about a body that could interfere, pervert or subvert the work of NAMA but that the agency would be seen to be accountable and answerable to a responsible body. That responsible body could then draw attention to issues it was concerned about and it would be up to the rest of us to get involved at that point. These are belt and braces activities which would very helpful to the Minister.

The 1% per annum thesis is not unreasonable. We must believe there will be a 1% per year improvement generally in the world over the next ten years. If not, we had better all start emigrating. That is not a huge ask in terms of credibility and it is not unreasonable. That presumption is based on the loans having a valuation of €47 billion or €54 billion, whichever it happens to be. I am not too sure or too unsure about that, rather I am agnostic about it because I cannot work out how the valuation has been done. A leap of faith or a trust in God is required in respect of that part of the process. That is the critical element on which this will work.

I did not hear all of the Minister of State's contribution but I do not believe he mentioned the Asset Resolution Corporation, ARC, Mark Duffy's new vehicle. It is interesting that Mr. Duffy got involved in that. Many of those opposing NAMA have said that if the concept proposed was so good, the private sector would be doing this - that the banks would be doing it for themselves. This is a private sector operation, where private equity and private sector money is being put into another vehicle which will produce something similar in terms of the non-NAMA banks, for want of a better word, or the non-Irish banks that are not included in NAMA. That is a good thing. I would like to hear the Minister of State's view on this.

How will that vehicle interact with NAMA? I am posing that question in a vacuum because we do not know all the details of the ARC business. I would like to hear the Minister of State's vision as to how NAMA and it will engage with each other. If ARC is operating, two things will happen. It will create a market of some description. It will be considering similar, although not the same, assets as NAMA. It will not be a real market in the sense that it does not appear that they will be bidding against each other, but they will establish prices and valuations. If ARC buys a piece of property that happens to be owned the Bank of Scotland Ireland and a comparable property is in the ownership of NAMA, at least we will then begin to see the valuation of such property.

I may be wrong in what I understand will happen and I pose this question seeking information on it. If ARC, Mark Duffy's vehicle, is in the business of collecting, buying or investing in assets, it could off-load, purchase or take over certain assets from NAMA - instead of putting them on the public market NAMA would sell or transfer them to ARC. This is my reading of how it might work, but I have yet to hear any public debate on that. If these two large vehicles are in place - NAMA will be much larger - operating at the same level, it is important for us to understand what will be the engagement and the interaction between them.

I understand section 15 the Bill effectively gives NAMA the authority or power to basically become land developers. There is a nettle to be grasped here. If NAMA has a half-developed or an undeveloped property which it and its advisers believe is worth developing as there is a market for it, it will have to deal with bankers, builders, developers and financiers. They are a small group of people in this country. It is very likely - in fact, it is certain - that some of the people with whom it will have to deal are the people who have led us into the difficulty in which we are currently. This is fraught. I do not see a way out of it. I will not just take a simple line on this, but we need a public debate on this. We need a public debate for people to understand this is the way it is going to be. There are only so many builders and if NAMA needs to develop land it will have to approach these builders. The chance is that these will be builders that led us into this current difficulty. If that is to happen, the assurance Irish people need is that these guys do not screw us one more time, that the next time they are asked to do something, it is done in a controlled environment where they work for us or where we make the profit on them rather them becoming millionaires or billionaires all over again on the backs of the problem they created for us on their first outing.

I have one more sentence on that just to reiterate it. I think section 15 of NAMA to dispose of assets in various different ways, including development, building, etc. Would the Minister of State, Deputy Mansergh, say a few words in his response on how that will happen and who will do the development financing because the banking, building and selling afterwards will need additional financing? The Minister of State sees the point at which I am getting. We should be open and honest about this and state this is how it will work.