With €74bn of assets being managed, NAMA is by the far the biggest state company in Ireland. And although it mightn’t be the biggest property asset management company in the world, it is significant on the global stage as well. The Irish state is on the hook for €30bn of bonds which NAMA has issued, and in addition the (slightly forlorn) hope is that NAMA could recoup not just the €30bn it paid for the loans, but some or all of the €42bn haircut it imposed on banks which the State has consequently had to recapitalise. NAMA is a massive, massive undertaking which is disposing of up to €750m of assets – loans and property – each month EVERY MONTH, by reference to original loan values. And yet we know next-to-nothing about how well or how badly the Agency is doing when it does dispose of assets.
NAMA will huff and puff and reject allegations that it is a secretive organisation lacking transparency. It will say that of ALL state companies operating in Ireland, it is subjected to MOST scrutiny. It will correctly say that it is subject to parliamentary oversight through committee hearings and parliamentary questions, it will correctly say it must produce quarterly reports and accounts, as well as an audited annual report. But perhaps most impressively, it will tell you that there is a team from the Comptroller and Auditor General’s office permanently on site at NAMA HQ in Dublin city. How many? It was recently revealed that the CAG expended “nine man years” examining NAMA in 2011 so you can assume there will be a handful on site at any one time. And these people are supposed to be constantly poring over NAMA’s operations to ensure it delivers on its objectives set out in the NAMA Act. So are you re-assured?
In an exchange in the Dail on Tuesday, the Minister for Finance Michael Noonan told Sinn Fein’s finance spokesperson that the CAG “does not have a role in overseeing transactions undertaken by or on behalf of the National Asset Management Agency on a day-to-day basis or in overseeing the terms of granting or refusing approval for specific transactions” The CAG is merely there to “review controls, processes and procedures”. Furthermore the CAG personnel may not have any experience or qualifications in asset management, property or loan sales, in either Ireland or overseas. The Minister says that the CAG will employ outside expertise as necessary to help it review NAMA, but there was no evidence of such employment in the recent CAG report on NAMA’s management of its loans. The full exchange is here
“Deputy Pearse Doherty: the role of Office of the Comptroller and Auditor General in relation to overseeing the National Assets Management Agency property sales; if he will provide details of the qualifications and experience which enable relevant personnel at the Office of the Comptroller and Auditor General to form a view on the merits of individual property and loan sales agreed or approved by NAMA; the qualifications and experience these personnel have in asset management, loan sales and real estate sales. [27958/12]
Minister for Finance, Michael Noonan: I understand that in auditing the financial statements of NAMA, the C&AG reviews the controls, processes and procedures in place in NAMA, including those designed to ensure that transactions achieve the best possible value for the taxpayer and are properly approved in accordance with NAMA’s governance framework. In a special report completed in February of this year, the C&AG reported on the arrangements in place in NAMA in relation to sales of property by debtors and insolvency practitioners. I am advised by the office of the C&AG that in situations where specific expertise is required for purposes of carrying out audits and examinations and such expertise is not available in the Office of the Comptroller and Auditor General, the Office procures the services of appropriately qualified and experienced experts on a consultancy basis.
The Comptroller and Auditor General’s (C&AG) role is to audit the performance and accounts of NAMA in accordance with the NAMA Act 2009 and the C&AG Act 1993. The C&AG does not have a role in overseeing transactions undertaken by or on behalf of the National Asset Management Agency on a day-to-day basis or in overseeing the terms of granting or refusing approval for specific transactions.”
So the next time NAMA tries to use the CAG as a shield to bat away concerns about its lack of transparency, the Agency might be reminded the CAG has no specific expertise in asset management and that it did not engage experts in its recent report on the Agency’s asset management function. And that for all intents and purposes, we still know nothing of the Agency’s performance in disposing of up to €750m of assets each month. It is a shame that Senator Mark Daly’s flawed Bill to impose transparency on NAMA didn’t get a second reading where concerns about contractual, commercial and constitutional matters might have been addressed whilst promoting the central ambition to allow the public see how its money is being managed. If NAMA is subjected to Freedom of Information legislation, I cannot see how we will be any wiser in terms of transactions which NAMA can claim are commercially sensitive and accordingly excluded from the ambit of FoI.
NAMA Wine Lake 