Marc MacSharry (Fianna Fail)

To do that would undermine due process as well as our ability to get through this and tap into the national expertise and talent that exists. Many people throughout the banking system, politics, the public service, the Opposition and the Government have things to offer in this debate. Just because people worked for a particular institution or have a particular political affiliation does not take away the fact that they may have something very constructive and worthwhile to offer in this debate.

We have focused on three main areas during this debate, namely, the special purpose vehicle, risk sharing and the long-term economic value. I am not at all paranoid about the concept of the special purpose vehicle. All aspects of this process will require the utmost level of scrutiny to the fullest extent possible, be it through the Houses, their joint committees and the various other watchdogs that can be put in place. It is vital we have absolute transparency and accountability, notwithstanding the fact that there are some aspects to NAMA and the special purpose vehicle that will not be open for competitive reasons.

When the Oireachtas joint committee was considering the draft Bill that was published over the summer, there was a suggestion of an oversight commission that would be given access to all aspects of NAMA, even the commercially sensitive information, so that the public could have even more confidence in the situation. Once established, NAMA will create the special purpose vehicle for the purchase, management and disposal of loan assets identified and valued by NAMA. For credibility reasons, it is vital the appropriate investors would be sought. It is not credible to have the banks as mainstream investors in the 51% stake. This needs to be looked at. Obviously, securities are to be guaranteed by the Irish banks, but many people are wondering why the SPV is necessary.

One of the key aspects of NAMA, particularly since the SPV has been mentioned, is communicating this situation to the public in, for want of a better expression, ladybird language. I am not an economist and while I may have learned a few terms over the last 12 months during economic debates, I do not have the qualifications, experience or background in economics of Senator Ross, for example. For the most part, the general public are in the same position as myself. I would like to see a simplified explanation of the SPV and the workings of NAMA. Perhaps this could be examined by the Minister, whether it is done through the national media or otherwise. Many of the debates on the airwaves and in the print media are confusing people because of their complex and highly technical nature. That gives rise to people not giving the full picture by resorting to hyperbole and political point scoring, which is dangerous. We would be well served if we could get that message out there. It may be too expensive to send a leaflet to every household, but this matter could be outlined on the airwaves in the simplest possible language for the public's benefit.

It is envisaged that the majority of private investors will come from pension funds. I have a slight concern in that regard because some pension funds are owned by banks, so I would like to hear the Minister explain where those investors would come from.

Concern has been expressed as to why the SPV was only mentioned last week. I am not paranoid about it because EUROSTAT had to make a ruling and once that ruling was made it was quickly left in the public domain. The benefit is that it will keep the level of debt off the balance sheet, which is appropriate. It is part of the country's debt, but it is appropriate that it be treated differently. It is underpinned by a property portfolio which will be managed over a period, whereas the sovereign debt is underpinned by the reputation and performance of the State overall.

I welcome the fact the Minister has already accepted some amendments, including one seeking to apply the provisions of the Prevention of Corruption Act 2001 to all members of the NAMA board, as well as all directors of any NAMA group entity, such as the SPV. The legislation will require that NAMA and all NAMA group entities will have a register of interests of all board members and staff, which his very important. In addition, reporting requirements in Part 3 of the Bill will also apply to the activities of NAMA group entities. The powers and rights that NAMA has in its dealings with participating institutions will attach to NAMA group institutions.

I note that Robbie Kelleher of Davy Stockbrokers stated the SPV seems to be a technical vehicle that gets debt off the balance sheet. He said he did not think it had any significant implications for NAMA. Many commentators have noted that it is quite an achievement for the State to have been given the go-ahead by EUROSTAT to implement the SPV.

One can see the motivation of the investors is exactly the same as that of the State. The aspect of private interests is positive from my perspective and it is clear that they will want to make a profit. My colleague, Deputy Michael McGrath, said that on "Prime Time" last week and I agree with him.

If possible, I would like more information on how the tax surcharge will be calculated. Is it payable at the end of ten years or will an amount be paid annually? What percentage will it be? Presumably it will relate to the amount of loans taken over from each bank, but how will it work out if some banks are profitable while others are not? I welcome the risk-sharing mechanisms that have been put in place by NAMA. I want more details on the surcharge, however, to ensure that is the case with subordinated debt.

The Minister mentioned that we will have bottom-up valuations to follow the top-down ones. As someone with experience in valuing and auctioneering, I presume those valuations will be less. Therefore I assume we will pay less, but I want to get a little more information on that. As preparations are made for these bottom-up valuations, I gather that various processes are being undertaken to secure the expertise that is required from a number of companies throughout the country. I wanted to make sure the appropriate geographical spread will be applied. It would be a mistake, for example, to go with reputation rather than specific local knowledge. In that regard, I hope each part of the country will have appropriate local knowledge when calculating these values.

Like everybody else, I am concerned about our ability to ensure the banks lend again. It is important to get a level of credit flowing to a greater extent than we currently have. Having said that, I do not particularly want it to be easy to get money. Part of the reason we are in this mess is because it was too easy to get money. I will always recall the finance company whose television advertisements made it sound like all one had to do was ring up to get a loan. All these people were being interviewed about how they managed to consolidate all their debts into one and still had enough money left over for a new speedboat. It was hilarious.

I hope this debate throws up some suggestions as to how the Minister could amend the Bill to get credit flowing, while at the time maintaining a level of robust underwriting that would not encourage the kind of madness we saw over the last number of years. We are a long way from 8% growth levels, but we should take that point on board.

We must ensure those who did nothing to deserve what is going to happen to them will not suffer most. It is vitally important for the purpose of credibility and basic justice that the first line in the queue for any potential loss is taken by developers. Given what has been outlined in NAMA, we are going to pursue developers and borrowers to the nth degree to ensure the maximum moneys are recovered in line with the loans that were taken out, or that the security in terms of assets will produce that.

After that, banks should take the next place in the queue before the taxpayer gets anything. It is vitally important that should be the case and that the banks will pay. We come back to the tax surcharge and I look forward to getting more detail on it.

As the Minister said, NAMA is widely supported and endorsed by such bodies as the IMF, the ECB and, more recently, the OECD, in addition to a variety of financial bodies throughout Europe and America. This undoubtedly gives Ireland the assurance and confidence that NAMA can and will succeed over time. The Minister mentioned that, while downgrading Ireland to an AA minus rating, Fitch noted the long-term outlook is stable. The rating agency also commended the Government for its vigorous fiscal consolidation response to date, given the likely success of NAMA's rehabilitating the banking sector.

Last Friday, the former Taoiseach Dr. Garret FitzGerald expressed his support by saying he thought the Government's policy approach was the correct one. Another former leader of Fine Gael, Mr. Alan Dukes, said the same, as have many other commentators. The OECD report said that further recapitalisation may be necessary, but should be temporary. The Minister has said that if that is necessary it will be done by taking a greater stake. Mr. Dukes summed it up perfectly well by saying simply that of all the plans on the table, NAMA was the correct one. It is interesting to note that, today, we have not yet had any mention of the Fine Gael national recovery plan.