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NAMA and risk reports

[Crossposted to thestory.ie]

I will post the document first and tell the story below, it’s worth a look. The information contained in this FOI, is I believe, valuable.

Cost-benefit analyses, impact reports or preparatory reports for NAMA

Why is this information valuable? It contains a timeline of what companies were involved in consulting the Government on the formation of NAMA, and gives us insight into the process. It also contains previously unknown titles, such as HSBC’s “Project Neo”. This is likely relates to the rumoured formation of a “New Anglo Irish Bank” in 2010. And it gives us an idea as to the level of involvement of Merrill, Arthur Cox, Rotschilds, PwC and HSBC.

The background:

A little bit of a saga ended today, finally. It is worth noting the dates involved in this request.

On August 17 I sought the following information from the Department of Finance:

1) A list of all cost-benefit analyses, impact reports or preparatory reports that have been carried out by the Department in relation to the proposed National Asset Management Agency (NAMA). Please can you list the title of the document, its date, and by whom it was written.

2) A list of all cost-benefit analyses, impact reports, or preparatory reports that have been carried out by people or companies working on behalf of, or at the request of the Department, in relation to the proposed National Asset Management Agency (NAMA). Please can you list the title of the document, its date, and by whom it was written.

I received my acknowledgment as standard, which was followed up with an email. The email said it was unlikely my request would be successful but if I wanted, I could be given information outside of my request. I went along with this and it resulted in this blog post on September 30. That’s in and around the 20 day limit under the Act.

But I didn’t feel the information provided was sufficient, and I always wanted information should my request be refused. So I said I still wanted to proceed with my original request. The Department then took the date of my re-request as the initial date, thus giving them another 20 working days. This brought the result of the request into early November, despite an initial request in August.

Numerous emails were sent, and replied to. The civil servants involved were “busy” with NAMA and it was taking longer than normal to reply to my request. Last week I had enough, and wrote an email seeking an internal review as my request was now a deemed refusal since the 20 day limit had expired. Today, December 8, nearly four months later, I got the reply.

Ireland's note to the Commission

[Cross posted to thestory.ie]

I was interested in some FOI work that Deputy Joan Burton had been doing lately on Anglo Irish Bank, so I contacted her and asked for any documents or refusals she had received. She was kind enough to copy everything and post them down to me. I have now scanned and OCRd the documentation.

First up is Ireland’s notification to the European Commission surrounding the injection of €1.5bn of capital into the bank. It runs to over 50 pages and contains some curious stuff. Many of the handwritten notes are I believe by Deputy Burton herself, or her staff. But there are other curious oddities, some of which are highlighted.

Firstly the document appears to have been poorly redacted. There are strikethroughs throughout the document with notes afterwards such as “[Confidential – commercially sensitive][Department to confirm]”. What appears to have happened is that a draft of the document was released, rather than a redacted version. The draft contains the internal notes around what should or should not be redacted. One gem (and this is dated January 2008) is “Anglo Irish Bank is considered a fundamentally sound institution”. With a note beside saying it might be “commercially sensitive” to say so.

Not alone that, but further down it says (with a line through it)

The assessment by Merrill Lynch supports the position that Anglo Irish Bank is fundamentally sound.[Confidential – commercially sensitive][Department to confirm]

Another gem which was marked for redaction, marking points arguing in favour of capital injection:

The assessment that there was a low likelihood that Anglo Irish Bank would be successful in raising additional equity from existing shareholders and new private investors Confidential – commercially sensitive][Department to confirm]

Also this very interesting paragraph around future planning:

As noted above, on account of Anglo Irish Bank’s specific business model, which is specialised in commercial property lending and property development finance, not all of the elements of the agreed credit package will directly impact on Anglo Irish Bank, at least initially. However, given the envisaged future changes in the Bank’s business model and strategic direction under its restructuring plan, it is anticipated that in time further elements of the credit package will become applicable to Anglo Irish Bank accordingly [Confidential —commercially sensitive for Anglo Irish Bank] [Department to confirm]

Finally, there is this further reference to Anglo’s future:

On account of Anglo Irish Bank’s specific business model, which is specialised in commercial property lending and property development finance, not all of the elements of the agreed credit package will directly impact on Anglo Irish Bank, at least initially. However, given the requirement to prepare a restructuring plan within a six month period as part of the recapitalisation initiative, future changes in the business model and strategic direction of Anglo Irish Bank are likely to bring about a closer alignment between the lending activities of the Bank and the credit needs of the real economy. As a result it is anticipated that in-time further elements of the credit package will become applicable to Anglo Irish Bank accordingly. [Confidential – business secret] [Department to confirm].

Of course questions need to be asked. This document is dated January 8. The Government already had the PwC reports into Anglo and must have had some idea of the scale of the problems at the bank. Yet Merrill was still claiming Anglo was fundamentally sound just a week before the bank was nationalised. Not alone that, all references to the bank being fundamentally sound were marked for redaction.

There is one final section that sums up the entire sorry mess:

Anglo Irish Bank is a focused business bank with a private banking arm. The Bank provides business banking, treasury and wealth/management services. It is not a universal bank and its stated strategy is niche rather than broad market. Each of its customers deals directly with a dedicated relationship manager and a product specialist.

Yet in the same breath we are told the Anglo is of systemic importance. So which is it?

Ireland’s note to the Commission [PDF]

TD/Senator expenses 2005 – 2008

[cross posted to thestory.ie]

For the record and as part of an ongoing FOI request, here are all expenses and salaries of all TDs and Senators, 2005 – 2008. I received them today via email from the Houses of the Oireachtas Commission. We hope to digitise this data shortly. I also received the following note:

In relation to the break down of allowances I wish to clarify the following:

1. Telephone Allowance is paid as an annual allowance on a quarterly basis to all Members. The allocation of this allowance to specific telephone bills is a matter for each individual Member, consequently the allowance is not quantified into land line calls and mobile phone calls. Any expenses incurred by members over and above this allowance have to be met by the individual Member.

2. Each member is also entitled to 1,750 “Post Office Preferred, pre-paid DL (one third A4) sized envelopes each month. Any postal charges that are over and above the pre-paid amount must be paid by the Member at the time of posting.

3. Daily Allowances appear within the Travel and Subsistence amounts on the records of any Member who is claiming Daily Allowance, this allowance is a flat rate allowance and there is no mileage element. Members who live within 15 miles of Leinster House can only claim this Daily Allowance.

4. The Travel and Subsistence Allowance for Members is paid as a combined figure through our financial management system and appears in the record as one monetary amount, consequently the record as released will give an overall figure for Travel and Subsistence in each subsequent year.

5. The Allowance to attend in the Houses for the purpose of conducting parliamentary business with other Members and the allowance to use the House facilities are again paid through our Financial Management System. These allowances are processed with the travel and overnight element of the claim, consequently they again appear within the Travel and Subsistence record as a monetary amount in the overall record. There are 25 nights allowed for using the House facilities and 5 nights for conducting parliamentary business.

6. Payments made in a given year can relate to a claim period for the same or a previous year.

7. Office and position holders have higher allowances due to the higher expenses they are deemed to have incurred.

Please note that former Members of the Oireachtas, Mr Tony Gregory T.D., Mr Joe Sherlock and Mr. Seamus Brennan T.D. (former Minister) and Senators Tony Kett, Kate Walsh, Peter Callanan details of whose expenses are included, have since died.

I would like to draw your attention to an administrative error which occurred in the payment of the Constituency Office Maintenance Allowance (COMA) which was beyond the control of Members. This allowance was overpaid by €931.83 in 2008 to re-elected Members due to a calculation error. As the COMA is paid in arrears, this overpayment took place in January 2008 and it therefore appears in the 2008 records. Accordingly the COMA for 2008 is overstated by €931.83. All Members affected were notified and all monies have been fully recouped. You should also note that some Coma payments made in 2008 related to expenses incurred in previous years which were not claimed until 2008.

You should also be aware that while some Members have monies showing in two positions, e.g. whip to a party and a committee position this signifies that they held these positions at different times in the year. The Oireachtas (Allowances to Members) and Ministerial, Parliamentary, Judicial and Court Officers Amendment Act 1998, states under Section 6(2) that “If a member is eligible during any period to receive more than one of the allowances provided for in sections 3, 4 and 5 of this Act, only the higher or highest of those allowances shall be paid or payable to the member during that period”.

I would also like to clarify that the amounts which appear for Members in receipt of Committee Allowances for 2008 in most cases are not an annual figure as various Members were allocated positions in 2007 and payment for these positions were not paid until 2008. The figures which appear are not reflective of annual amounts. I have included a schedule of specified position amounts which were in effect during 2008 for your assistance.

You should also be aware that following a Boundary Commission Report in 2007, several constituency boundaries were revised and re-categorised. All Members in constituencies which were re-categorised were reverted to the lowest rate and were subsequently repaid the correct allowance in January 2008, which in some cases included arrears. The figures which appear in 2008 again for some Members are not reflective of an annual amount.

Explanatory document

Deputies salary and allowances 2005
Deputies salary and allowances 2006
Deputies salary and allowances 2007
Deputies salary and allowances 2008

Senator salary and allowances 2005
Senator salary and allowances 2006
Senator salary and allowances 2007
Senator salary and allowances 2008

John O'Donoghue resigns

It took months of work by Ken Foxe at the Sunday Tribune. His efforts deserve every applause.

For my own part, I started posting Ken’s FOI work online on August 18. I hope this helped in some way to get Ken’s work more exposure, and help force this resignation. For even half of the trips at the Department of Tourism, John O’Donoghue should have resigned. It took another set of expenses to tip it over the edge.

Mr O’Donoghue is a national disgrace. He has disgraced his party, disgraced the office he holds, disgraced our parliament, and disgraced our country.

But the FOI work continues.

Update: Taoiseach’s statment:

“In indicating his intention to step down from the office of Ceann Comhairle, John O’Donoghue TD, acted in the best interests of Dáil Éireann,
and the office of Ceann Comhairle. He has been a most effective and fair Ceann Comhairle who has acted with commitment and integrity to ensure that the members of Dáil Éireann could debate freely and fairly the issues of the day.”

“The Ceann Comhairle has indicated that he wishes to make a statement to the House next week, I respect his right to do that. I thank him for his contribution to this Dáil as Ceann Comhairle and I wish him well for the future.”

John O'Donoghue expenses

For the record. Total expenses so far revealed (2006 – 2009): more than €700,000.

Incurred as Minister for Arts Sport and Tourism:

JOD Part 1 (India)
JOD Part 2 (Birmingham)
JOD Part 3 (Berlin)
JOD Part 4 (London)
JOD Part 5 (London)
JOD Part 6 (Venice)
JOD Part 7 (Manchester)
JOD Part 8 (New York)
JOD Part 9 (Turin)
JOD Part 10 (Stuttgart)
JOD Part 11 (Paris) (yet to be scanned by myself!)

Incurred as Ceann Comhairle, 2007 – 2009:

Explanatory document on CC expenses

Schedule 1 – Allowances and Expenses
Schedule 2 – Domestic flights
Schedule 3 – Details of foreign travel
Schedule 4 – Official entertainment

DOC

Domestic Travel 1
Domestic Travel 2
Domestic Travel 3
Domestic Travel 4
Domestic Travel 5

1 Stop Shop Constituency Expenses

Those NTMA pay scales

Last week I blogged a response I had received from the Department of Finance concerning Government consultations over the establishment of NAMA. The response was prompted by an FOI request, seeking the titles, dates and authors of consultation reports for the Government (seeking the documents themselves would have been refused outright).

What it brought to light, in a small way, was how little in-house expertise the Government has. Reports were written for the Government by Merrill Lynch, PriceWaterhouseCoopers, Arthur Cox, Peter Bacon, Rothschild, and HSBC. If you are wondering who drafted the NAMA legislation, the answer lies somewhere between all of these companies and people, the Department of Finance and the Minister. It would also be fair to say that the Irish banks must have had input into the process, since they are the ones who are being saved from bankruptcy.

Many of these companies though were engaged not by the Department of Finance, but by the National Treasury Management Agency. They are the guys who issue sovereign bonds and manage the national debt, or as their website says:

The 1990 Act empowers the NTMA “to borrow moneys for the Exchequer and to manage the National Debt on behalf of and subject to the control and general superintendence of the Minister for Finance and to perform certain related functions and to provide for connected matters”.

Now my interest is piqued because the salary of NTMA chief executive Michael Somers is secret. The same is true, it appears, of all other staff at the NTMA.

Thanks to some helpful readers, from what I can gather, NTMA pay bands are as follows:

91 members of staff are paid below €80,000 a year.
22 staff are paid between €80,000 and €100,000 a year.
27 staff are paid between €100,000 and €200,000 a year.
9 staff are paid over €200,000 a year.

The average bonus paid in 2008, for work during 2007, was €21,447.

I make that 149 members of staff. I also make that a bonus fund mean of €3.1 million for 2007. If we take the lower tier staff, and take the upper range of figures, we could surmise that at the maximum budget allowed (if people are all paid at the top of the range, which is unlikely) is:

€7.28m
€2.2m
€5.4m

Which would make €14.8m at the maximum allowable wage for each person. Add that to bonuses of another €3.1m. This excludes the 9 staff, since there is no ceiling there. We are hitting €20m in staff costs alone, minus directors. It is rumoured that Mr Somers earns anywhere between €200,000 and €1,000,000 a year.

The question is this: As a taxpayer am I entitled to know the salary of Mr Somers, and other highly paid staff at the NTMA? Is the public interest better served by this information being available, or is it better served by it being secret? The Government would argue that such high wages are needed to get the skills necessary from the private sector, and if these people were not working in the public sector, they could be earning more in the private sector – therefore we need high wages.

I don’t buy it. Where is the spirit of public service, like we see in the US? I am certain that many of the people working in the finance arms of the Obama administration want to work in service of the State because it is a part of a citizen’s duty. The salaries of many high ranking officials are freely available too. Treasury Secretary Timothy Geithner earns $191,300 a year, minus expenses. Fed chairman Ben Bernanke earns the same amount minus expenses (Although Geithner’s predecessor had an estimated net worth of $500m thanks to his years at Goldman Sachs).

The salaries of people who are being paid by the taxpayer, such as people at the NTMA, should be published on their website. We have to ask ourselves how the public interest is served by keeping this information secret, and if any arguments in favour of secrecy have merit. The interest in their salaries is not prurient, it is simply how accountable systems work. Publish the information, then we know.

No big deal, right?

So the next question is this: Under what section and subsection of the FOI act would a request for salaries be refused?

John O'Donoghue files Part Deux

These documents became available because of an FOI request of Ken Foxe and the Sunday Tribune, which paid €600 for this information. Details were due to be published on Sunday October 4. John O’Donoghue pre-empted this by publishing the information today.

All receipts (PDFs):

Explanatory document on CC expenses

Schedule 1 – Allowances and Expenses
Schedule 2 – Domestic flights
Schedule 3 – Details of foreign travel
Schedule 4 – Official entertainment

DOC

Domestic Travel 1
Domestic Travel 2
Domestic Travel 3
Domestic Travel 4
Domestic Travel 5

1 Stop Shop Constituency Expenses

Mary Hanafin's trip to India

[cross posted to thestory.ie]

In 2006 the Government went on a trade mission to India. Mary Hanafin as Minister for Education went along. I put in the following FOI request:

1) The Minister’s schedule and appointments between January 1, 2006 and March 1, 2006.

2) A breakdown of flight costs, accommodation costs, hospitality costs, and any other costs borne by the Department for a trip taken by the Minister to India in January 2006, and a breakdown of any expenses claimed.

I will upload the schedule later. The total trip cost €26,421.14. Flights cost €20,912.84. Ms Hanafin’s flight alone cost €8,990.28.

For now, here is the spreadsheet of costs (go to the bottom of the sheet and click “costs India trip” :

Hanafin India 2006

I do not believe removing the names of other people who went on the trip is warranted under Section 28 (1) (personal information). I will be appealing this element of the request.


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