The Irish Times is reporting today that NAMA is trying to engage insolvency practitioners (IPs) to work on what is likely to be a large caseload of companies and individuals whose loans are being transferred to the agency. The agency was astounded to find some IPs charging €800 per hour (that’s €32,000 for a 40-hour week and given the likely caseloads I would not be surprised to see weekly worked hours extend far beyond that). NAMA was “astounded” at that rate and has settled at rates “starting from €180 per hour” (that’s €7,200 for a 40-hour week).
Some observers might be perplexed at IPs naming their own price. They might think it usual for the employer to set an appropriate price for a job and proceed in that manner. And for an area of expertise that NAMA is likely to need call on very soon and on a large scale it is a little worrying that NAMA should be “astounded” at some rates – shouldn’t someone at NAMA understand the skills they are engaging (and remember that NAMA can make use of the knowledge of the Comptroller and Auditor General) and the general levels of pay?
And as for an IP – if it is a single person whose “talent” consists of knowing a wide (but not that wide) area of law and understanding the insolvency process – charging €800 per hour, perhaps Wayne’s agent has undervalued the Manchester United star, who on occasion does show genius on the pitch, at only €283,000 per week.
NAMA Wine Lake 
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Interesting review of IP fee rates at http://www.finfacts.ie/irishfinancenews/article_1020057.shtml
Also, last week either the IT or SBP carried a story about fee rates at one of the major solicitors and quoted rates for partners and trainee solicitors. The latter rate was about €180 per hour. That is some markup on the actual salary paid to trainees. I can see why Irish legal firms are amongst the most profitable in Europe – see http://www.irishtimes.com/newspaper/frontpage/2010/0508/1224269952902.html
Would it not make sense that NAMA have its own full time legal people working on insolvency rather than outsourcing to IP’s. Its not that they are likely to run out off work for some time and there are lots of young legal people out of work that would cost a lost less than €180 per hour ??
I’m not sure what experience NAMA’s Head of Tax and Legal, Aideen O’Reilly, has of insolvency law – she seems to come from a civil service background. Perhaps she wouldn’t feel comfortable employing and managing knowledge & skills which she doesn’t understand sufficiently. Perhaps she feels less exposed if a third party were engaged to discharge the function.
Remember the article says “from €180 per hour”, so that’s the floor it seems.