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Archive for February 27th, 2013

It comes as a surprise to some that there is still economic life in the colourful Johnny Ronan, the co-founder of Treasury Holdings which failed spectacularly last year after NAMA and KBC moved against it; Johnny currently has at least two high profile legal cases on the go in the High Court – as co-owner of Tanat Limited, Johnny is currently pursuing Dublin City Council over a rental agreement at Kingram House off Fitzwilliam Square, and separately as owner of Ickendel Limited, he is pursuing Bewley’s over their rental agreement at their outlet on Grafton Street. Despite his difficulties with NAMA last year, Johnny is said to be still cooperating with the Agency on his personal loans. Those familiar with Johnny’s story will know that his origins are in Tipperary where his dad was a pig farmer in Carrick-on-Suir, but it seems he is a member of a large family of entrepreneurs.

We previously saw in the Vita Cortex dispute that Jack Ronan, understood to be a cousin of Johnny’s, also had loans transferred to NAMA and indeed, NAMA was blamed by Vita Cortex management at the time for the failure of the company, which memorably saw a sit-in for 161 days after workers held out for what they claim was a promised-redundancy deal. Jack has a range of business interests including Orchardstown stud, a pre-school business called KangaKare, supermarkets through the La Plange group and a pig biotechnology business PIC Ireland Limited,

Today, we learn via Iris Oifigiuil that more Tipperary companies in the Ronan dynasty have failed. Liquidators have been appointed to Moville Investments Limited, Rocklow Holdings Limited and John Ronan and Sons Limited. The directors and owners of all three are Paul Ronan (57) and Thomas Ronan (50) who are understood to be second cousins of the colourful Johnny. At a meeting on 18th January 2013, Michael White of Courhouse Chambers in Cork was appointed liquidator to all three companies.

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It was the Fianna Fail finance spokesperson Michael McGrath who re-ignited the whole bankers’ pay and perks controversy last October 2012 when, at an Oireachtas committee hearing, he quietly asked the CEO of AIB, David Duffy about the €1.1bn that had been shoveled into the AIB pension fund the previous August. There was outrage at the time when it emerged that the former CEO of AIB, Eugene Sheehy was in receipt of an annual pension of between €300-325,000.

We found out that people we hold as responsible for the banking collapse were not only escaping accountability, but having retired, they were directly benefitting financially from the state bailout which has been in part used to plug the giant hole in the AIB pension fund. At the time, the new AIB CEO, David Duffy said he would write to the former senior executives seeking a waiver.

We still await the publication of the Mercer expert report on bank pay and perks; this is the report which was commissioned last June 2012 and about which Minister for Finance, Michael Noonan said this week, was still being prepared – it’s now been eight months since the €120,000 report was commissioned, and it is constantly used by Minister Noonan to stonewall questions.  Minister Noonan has a stock response to banking pay questions and that is “the further more detailed information sought in this question is not available to my Department at the present time and the compilation of this information, particularly the historic element, is likely to delay completion of the Mercer Remuneration Report which is a Government priority”

Well, yesterday, Minister Noonan didn’t use the stock Mercer report as a shield when quizzed by Deputy McGrath about the overall numbers of former AIB bankers who have been written to, by the AIB CEO seeking waivers because their pensions are so obscenely grand when set against the disastrous financial calamity that befell AIB, and which resulted in a bailout of €20bn from the taxpayer. No, Minister Noonan just claimed it was all confidential, and even providing anonymised totals would breach confidentiality duties. And in a new stonewalling technique, Minister Noonan came up with the following form of words “Given this is an on-going complicated process from a tax, legal and Revenue perspective the Bank is not in a position to confirm the levels of reductions achieved to date.”

You might recall that on 7th November 2012, AIB confirmed that it was writing to about 15 former senior executives seeking a waiver of their bumper pensions. We know that former CEO Eugene Sheehy agreed a waiver of between €50-75,000 to bring his annual pension down to €250,000. Are we to deduce from Minister Noonan’s response that the response from the senior executives to the request for a waiver was so bad, that it would be embarrassing to provide totals?

This is the full parliamentary question and response.

Deputy Michael McGrath: To ask the Minister for Finance the number of retired executives of AIB including EBS that have been written to by the bank asking that they consider voluntarily forgoing a portion of their pension; the number that responded positively, negatively, or not at all; the number of the retired executives that have since actually foregone some of their pension entitlement and the overall value of the pensions entitlements that have been foregone by retired executives of the bank.

Minister for Finance, Michael Noonan: The Deputy will be aware that AIB has previously confirmed that it has written to former senior executives of both AIB and EBS Limited requesting a voluntary reduction in their pension levels.

The Bank has informed me that is not disclosing the names of these individuals on confidentiality grounds, but that it has to date issued in excess of thirty letters. AIB is not in a position to release information on former employees without the express consent of the individuals.

Given this is an on-going complicated process from a tax, legal and Revenue perspective the Bank is not in a position to confirm the levels of reductions achieved to date.

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Coghlan1

An Taoiseach Enda Kenny has promised us this year that we will have a referendum on the abolishment of the Seanad, which houses 60 elected, quasi elected and “given the nod” of our great and good whose main purpose in life is to improve the quality of legislation passing through the Oireachtas. These 60 who already earn basic salaries of €65,621 – and who coincidentally will have to give up €32 of their salaries under Croke Park 2, yes that’s more than 60c a week! – also receive a range of perks and allowances eg €44,336 for Paddy Burke who is the speaker or An Cathaoirleach – take a look at all their pay and perks here, it’s fantastic stuff for a country in an IMF bailout with a €12bn annual deficit.

In the meantime until the abolishment referendum, the Senators continue with their work, but as we see today with the publication of the register of member interests for 2013, many of them have work beyond the confines of the north wing of Leinster House.

The register is available here in Irish Oifigiuil, you will need scroll down a third of the way to find the register which should be available on the Oireachtas website shortly.

It should be said that there are senators who show nil returns throughout, though a significant number have other assets and incomes which indicate considerable diversion from the duties as senators.

There are snippets of interest throughout, two senators – Martin Conway and John Kelly – registered gifts from Iranian interests for a conference in Paris, recently-resigned senator and hubby of former Irish president, Mary McAleese, Martin discloses he has received as gifts, membership of several golf clubs including one at the K Club in Kildare. Also interesting that Professor John Crown who has given up his salary from the Oireachtas post to charity, lists drug interests in shares and providing travel facilities.

JohnCrown

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It’s 1st March 2013, this coming Friday. But don’t get too excited just yet, as most of the Act is not being commenced at this time.

CommencementOrderInsolvencyAct

The announcement was contained in yesterday’s edition of Iris Oifigiuil.

It is a partial commencement date which applies to parts of the Personal Insolvency Act 2012 – available here – but mostly to the Insolvency Service. Note that the entire Act is not being commenced.

What does it mean?

For now, you still can’t access the processes provided for under the Act, the Debt Relief Notices, Personal Insolvency or Bankruptcy. It just means that the Insolvency Service is up and running. Pressure still needs to be brought on the justice minister, Alan Shatter to commence the entire legislation which he is being frogmarched into introducing, by the IMF – if we were relying on the soporific minister alone to reform our draconian bankruptcy laws, we would have a very long wait indeed.

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GavinSheridan

For those of you who turned up at the High Court last year to witness the art installation of two state bodies – NAMA and the Office of Commissioner of Environmental Information – both spending vast sums on legal expenses in a battle to access, and prevent access to, environmental information from NAMA, you will be interested in the judgment this morning, which is a victory for the Information Commissioner and a sorry defeat for NAMA.

Gavin Sheridan, who operates thestory.ie transparency website – and who was described in the Dail this morning as a “leading light for transparency in this State” – always corrects you when you refer to the case as involving the Information Commissioner, because although Emily O’Reilly – pictured below –  wears a number of hats, and she actually holds both posts, the posts are slightly different because they provide for information under different legislation, but you can be forgiven for confusing them. The victory this morning is for Emily, the Commissioner of Environmental Information, mkay? However it was Gavin’s original request three years ago to NAMA which gave rise to the involvement of the Information Commissioner and to the subsequent High Court case, and this morning’s judgment. So a great day for Gavin, well done to him – you can follow him on Twitter here, and he is himself at the High Court today.

EmilyOReilly

The judgment from the High Court is not yet online, but when it is, it should be available here. It is likely that Gavin will host a copy of the judgment on thestory.ie website here.

In the Dail this morning, the Sinn Fein finance spokesperson Pearse Doherty asked An Taoiseach Enda Kenny to order the Minister for Finance Michael Noonan to issue a Direction to NAMA pursuant to the NAMA Act, to stop NAMA appealing the decision to the Supreme Court. An Taoiseach said he had not read the High Court judgment and accordingly declined to provide a response.

So what does the judgment mean? Unfortunately not very much, and I don’t think there is very much information that can be accessed from NAMA under the environment information legislation that will be helpful. We might find out some more about ghost estates and NAMA’s deliberations on them, but I do not think the environmental information framework will allow us access to any great degree, the detail of what NAMA is doing. But you never know, these things sometimes have unintended consequences.

In a political sense, the judgment is a disaster for NAMA. Here is one State agency that funded legal action over three years to stop itself being classified as a public body. The costs will be steep and you and I are footing them. It looks dreadful for NAMA because the perception is the Agency has tried to protect its secretive operations from prying eyes, and it lost.

NAMA was asked for a comment on this morning’s judgment, how much it had spent on the case and whether it would now appeal the judgment to the Supreme Court. There has not been a response at time of writing.

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