Of the Week…

Table of the Week

 

This week, the European statistics agency, Eurostat published the latest GDP data for the EU and selected non-EU countries. Nine of the 27 EU countries are clearly in recession with two successive quarters of negative GDP growth, but as we know on here, Ireland too is in recession because although its change in Q4,2012 was officially logged as 0.0% or -0.0%, it is actually -0.047% which confirms a second quarter of GDP contraction.

Salaries of the Week

This was the week that we learned the last accounts for the Irish Film Classification Office were for 2009 and that subsequent accounts hadn’t been filed “due to an oversight”. We learned this week that the latest accounts filed for Ireland’s woeful Competition Authority were for 2010 and are available here. No word on subsequent years. We learned that the average salary for the 46 staff in the Competition Authority, comprising four board members, 38 staff and four secondments from other Government departments was an impressive €68,600 in 2010. Furthermore, the relatively small operation ran up unspecified – no, not building or travel or printing or advertising – administration costs of €139,000 and IT costs of €104,000. Overall, the operation cost us €4.4m in 2010. Its outputs are less impressive, it certainly deals with notifiable mergers but I cannot see evidence of robustly rejecting a merger, ever. There are a tiny number of prosecutions for competition infringements, and yet, we continue to live in a State where medicines are several times more expensive than in the neighbouring jurisdiction, our lawyers are still the second most expensive in Europe after Moscow, our recession-racked economy still tolerates €500-1,000 per hour payments to professions. And don’t even get me started on consumer goods, from groceries to mobile phones.

Quote of the Week

“It really does make me ashamed of my government when they can get wages in the hundreds of thousands annually, but when one of the most important children’s wards in Ireland, for some of the sickest kids in Ireland, has to rely on charitable donations to buy a bucket of paint and a brush. That is one of the sickest things I have ever come across in my short lifetime here” 16-year old Kerry man Donal Walsh who lost his fight with cancer last weekend – in his own words he wrote about dealing with cancer, they’re worth a read here and here.

Rubbish of the Week

A month ago, amid widespread illegal dumping in the Gardiner Street area of Dublin, Dublin City Council was threatening not to collect rubbish from certain areas of the city and let the residents resolve the problem of illegal dumping themselves; how, wasn’t clear but it had hints of a call for vigilantism but in the end, DCC abandoned that hare-brained scheme but have now introduced another – over a week ago, they confirmed they were writing to local authority tenants demanding proof that they had paid for a waste disposal provider. And it seems DCC is even proposing to extend this new scheme to allow its officials knock on anyone’s door to demand proof of having engaged a provider.

Curse of Dragons Den of the Week

The “curse of Hello” where full colour splashes of celebrity lives in the pages of Hello magazine, only to be soon followed by banana skins, revelations of peccadillos and tragedy, seems to have spread to the Dragons Den, the Japanese TV format created which was picked up by the BBC and latterly by RTE. In Ireland, we have seen Dragons Bill Cullen’s motor dealership and hotel operation fall from grace, and more recently Niall O’Farrell’s chain of formal wear and suit hire shops fall victim to the ongoing recession. In the UK this week, the Daily Mail suggested that one of the stars of the UK version of the show, Duncan Bannatyne was facing money troubles, though the scrappy Scotsman was quick to tweet that the Daily Mail story was untrue.

Table of the Week

This week, the NTMA produced its monthly “Ireland has turned the corner” presentation to investors with its laughable spin on an economy still in recession, with 14% unemployment, with retail sales declining (fast), with commercial property rents and capital values declining, with residential property declining, the NTMA still manages to appear positive. Its openness proxy is a good one – this adds together exports (X) plus imports (M) and divides the sum by GDP. In Ireland’s case, we are amazing compared to the other PIIGS, but this ignores the massive in/out flows from multinationals which is a unique feature of the Irish FDI-focussed economy. Anyway, good to know residential property rose for the first time since 2007…..

Old Media swan song of the Week

“Sarah McInerney of The Sunday Times acknowledged that the online version of that newspaper’s Irish edition which she said was known within the company as the “regional edition”, was “not doing well”.” So reported the Irish Times this week

We also had UTV’s management statement for Q1,2013 which noted that its commercial radio operations in Ireland (north and south) were down 8% in Q1,2013 compared to a year previously. That’s a worrying decline for a company that is well regarded commercially but more worrying was the statement “We believe  that we continue to outperform the market” which doesn’t bode well for competitors here, particularly RTE and Communicorp (Newstalk and Talk amongst others) and Landmark Enterpises (the Crosbie vehicle that has taken on the operation of local radio interests previously managed by TCH).

We also had Johnston Press’s management statement for Q1,2013 – you might ask where are the statements for Irish-owned companies but apart from IN&M indicating revenues were down 10% this year on last, we haven’t heard a mig from our own. Johnston Press publishes 12 local titles in Ireland – Donegal Democrat, Donegal People’s Press, Dundalk Democrat, Leinster Leader, Leinster Express, Leitrim Observer, Longford Leader, Kilkenny People, Limerick Leader,  The Nationalist and Munster Advertiser, Tipperary Star and The Echo in Tallaght. Although total revenues were down 11.4% in Q1,2013 from a year previously, it seems the decline is concentrated on advertising and that circulation revenue had held up.

Resemblance of the Week

Colourful Independent TD for Roscommon, Luke “Ming” Flanagan turned up at the Dail this week, a-la-Paris Hilton, with a tiny dog in tow. Julie, which could be a Scottish Terrier but could be some lovable Roscommon-Leitrim mongrel. Perhaps one of these days, the old media might run a feature of politicians and their dogs to judge if owners indeed chose dogs in their own reflection.

Parliamentary insult of the Week

“In truth I have to say that I am fed up to the back teeth with the foot dragging, the whinging, the stalling; sometimes, you might even say the attempt to politically posture on critical issues such as this; the begrudging, the bellyaching that you hear, the conditioning before statements can go out from colleagues. And I’m depressed listening to a tribe of Jeremiahs that infest the political process  and whose first thought is to attack any genuine attempt that is made for positive proposals. And those people of course have nothing to contribute themselves. And I also have to say that I get glum at the whited sepulchers who pontificate to us about a shared society and talk to us about harmony and consensus politics and yet, unless they are taking the lead themselves and are taking everything they want, they strain and stretch every sinew to abstain and obstruct what is going on. And quite honestly Mr Speaker, I think we have reached the stage that if we wait for the last person to board the train, the train will never leave the station“ Peter Robinson, First Minister of Northern Ireland, in the Stormont Assembly responding to criticism of the joint Sinn Fein/DUP “Together: Building a United Community”

Let’s hope Peter’s grasp of the political challenges facing Northern Ireland is better than his grasp of the Good Book. The prophet Jeremiah may well have forecast doom-and-gloom but as it turned out, his predictions were accurate. And a day or two later, the TUV picked up on this when they issued a statement

“Yesterday the co-First Minister branded his critics in the Assembly “a tribe of Jeremiahs”. The image struck me as an exceptionally odd form of insult, particularly as the warnings proffered by Jeremiah proved to be accurate. Given the traffic chaos which is developing at the Maze it is obvious that the warnings of some Jeremiahs have been well founded.”

Tax Home Truth of the Week

“The art of taxation consists in so plucking the goose as to obtain the largest amount of feathers with the least possible amount of hissing” Jean-Baptiste Colbert, finance minister under Louis XIV in 17th century

Okay, it’s not new but the general absence of hissing over the property tax – yes, there have been a few marches, a handful of occupations but the indications from the Revenue Commissioners is that the tax has been accepted far more widely than its predecessor, the household charge. This time around, the Government has firmly passed responsibility for the tax to the still-generally-feared Revenue Commissioners, it has a 50% discount in place for 2013 and despite it being a deeply unfair tax in many respects, it seems as if it is on track to be accepted by a considerable majority by the filing deadline – 28th May 2013.

Act of Transparency of the Week

In Uganda, a country with a land area three times that of Ireland, and a country to which we provide foreign aid, this week, they achieved a fully computerized Land Registry showing who owns what.  Amazing. In Ireland, we haven’t quite registered all property yet, and there is a sizable amount, particularly in south county Dublin, apparently, that has yet to make it online. So, you just have to wander up to the dusty Public Records Office on Constitution Hill in Dublin and pay your €15 for a photocopy.

Whitewash of the Week

The vehement disdain towards the “anonymous author” that blew the whistle on Garda malpractice in quashing traffic penalty points, was not well disguised. Nor was the anonymous author whom we’ve all known for some time was John Wilson. The report itself is here and there is a lengthy additional report on what the Garda practices are. Heads are still being scratched at how seven separate notices being quashed for the same family didn’t rise to the level of corruption. But mostly we wanted to know why the Gardai were investigating themselves when we have a perfectly good Garda Ombudsman set up for such investigations. Three Gardai face disciplinary action, the report will now be examined by the Oireachtas justice committee but the Garda Commissioner and Minister for Justice Alan Shatter are desperate to draw a line under the whole affair and calls by Transparency International for better protection of whistleblowers seem to have fallen on (the) deaf ears in Officialdom.

Response to debt demand of the Week

And finally, Clare Dooley whose Twitter profile says she assists people suffering in the economic downturn provides a novel approach to demand letters from the banks.

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Johnny Ronan finally wins a court case

This afternoon in Dublin’s High Court, Mr Justice Iarflaith O’Neill ruled in favour of the colourful Johnny Ronan’s landlord company in a case against the tenant, the Irish Medical Council. Johnny’s company, Tanat Limited, co-owned with Kildare developer Peter Conlan had claimed that a lease on a property,  Kingram House  off Fitzwilliam Square pre-dated February 2010 when Upward Only Rent Review clauses were outlawed. Although the lease was technically entered into after February 2010, the judge today ruled that a series of exchanges in 2008 were sufficient to establish the existence of a lease then.

So great news for Johnny who will see the rent maintained at €820,000 even though the evidence shows the current market rent for Kingram House today would be €374,100.

The judgment from today is not yet online.

Elsewhere the Court Service indicates that there has not yet been any appeal by Johnny’s company Ickendel against a High Court ruling which saw Bewleys Oriental Cafe win the right to a current market rent rather than the 2007 rent which had been imposed on it. NAMA might have been called on to fund the appeal, and it might be the Agency decides to let this litigation pass. Last year. Johnny lost control over many of his prized assets when NAMA had receivers appointed to Treasury Holdings companies and subsequent attempts by Johnny to have the receivership overturned were unsuccessful. And more recently the Treasury Opera CMBS is ending up in the hands of investors who bought underlying loan rights.

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Allsop Space auction – 15th May 2013 – results and analysis

It says something about how atrocious Irish property companies are in that they have all singularly failed to replicate anything like the success of Allsop Space property auctions, and it really makes you wonder if they’re so dumb that they can’t operate a large scale auction, then how dumb are they in their provision of other services? How competitive are their valuations? How efficient are they at marketing? How good is their research?

Today saw the 11th Allsop Space auction in Ireland, and it was another stunning success with 88% of the Lots on offer sold at or after the auction. Although there were 126 Lots originally, 10 were withdrawn prior to today, two were sold prior to today which is a new development, and three were sold after the hammer came down with the reserve not reached. The success rate calculated on here is 88%. The total realized was €12,620,500 excluding the “Sold Afters” which was an average of 34% above the maximum reserves of €9,400,000.

Here are the results, you will find the links the Lot details here.

The auction was again packed and at 3pm this afternoon, there were a few seats available but not many, the view here is that about 2,000 attended. There was a protest outside the Shelbourne Hotel at the start of the auction and there appeared to be more security in evidence than previously.

Two Lots were sold prior to the auction which is a new development and a request for comment has been made to the Allsop Space director of auctions, Robert Hoban, as previously Allsop Space had stressed that it would not sell Lots before the auction.

The maximum reserves of the 126 Lots was €16.3m and given the Maximum Reserves of the Lots sold today was €9.4m, that confirms that some of the unsolds were big. The 60 apartment development in Cavan whose Maximum Reserve was reduced today from €1.5-1.7m to €1.3-1.5m still didn’t sell. Nor did the period house on 51 acres in Murroe in county Limerick which has a reserve range of €425-450,000 but only reached €405,000 today.

Our friend Carol Tallon at Buyers Broker Ltd wasn’t tweeting highest prices for unsold Lots today so the above results are a little less useful than usual.

Other than that, a polished performance from Allsop Space; Gary Murphy was the master of ceremonies as usual, and although there was a dispute on one Lot, there was no significant protest from the floor today. Further analysis later, but there were actual residential yields there today of well over 10%, which indicates that residential prices may still be in for a correction, that or rents are set to reduce in some areas.

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UK commercial property prices flat in April 2013 – IPD index published

This afternoon saw the publication of the April 2013 IPD Monthly Property Index for the UK. The IPD (Investment Property Database) index is the only UK commercial index referenced by NAMA’s Long Term Economic Value Regulations (Schedule 2) and is used to help calculate the performance of NAMA’s “key markets data” shown at the top of this page.

The Index shows that capital values were flat in April 2013, which which follows declines averaging 0.3% per month since December 2011. Prices reached a peak in the UK in June 2007 and fell steadily until August 2009 when a rally started. Prices then increased by 15% in the year to August 2010 but have since been declining and are down by 3.5% in the last 12 months.

Overall since NAMA’s Valuation Date of 30th November, 2009 prices have increased by 6.3%. Commercial prices in the UK are now 37.1% off their peak in June 2007. The NWL index  remains at 777.1 which means that NAMA needs to see a blended increase of 28.7% in property prices across its portfolio to break even at a gross profit level (taking into account the fact that subordinated bonds will not need be honoured if NAMA makes a loss).

The table below shows the three subsectors in UK commercial property with an index for all three at NAMA’s valuation date of 30th November 2009 of 100. Retail has performed worst whilst offices have been relatively buoyant whereas industrial premises like factories and warehouses have been relatively flat.

It was September 2011 – 19 months ago – when the UK index last saw an increase and really since August 2010, has been flat and declining.  The prediction for 2013 is for flat prices, though there is an expectation of increases next year and beyond (see below)

The UK economy is suffering difficulties almost every bit as challenging as those in the EuroZone and Ireland. Sure, they have their own currency and they’ve printed GBP 300bn of it in an economy with a GDP of 1.5tn, to help inflate their problems away. And yet they appear poised for a triple dip recession.  On 20th March 2013, the UK’s independent Office for Budget Responsibility published its latest fiscal outlook which forecasts GDP for 2013-2017 at 0.6%, 1.8%, 2.3%, 2.7% and 2.8% (but as with all economic forecasts in the long term, all forecasters forecast a peachy outlook!). Deficit:GDP is forecast for 2013-2017 as 6.8%, 6.0%, 5.2%, 3.5% and 2.3%. Debt:GDP is forecast in 2013-2017 at 94.9%, 98.6%, 100.8%, 100.8% and 99.4%. Inflation is forecast for 2013-2017 at 2.8%, 2.4%, 2.1%, 2.0% and 2.0%. It expects residential prices to increase 0.9%, 1.9%. 3.6%, 4.0% and 4.0% in 2013-2017 and commercial property to change -0.1%, 2.6%, 3.6%, 3.8% and 3.4%.

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Week Ahead 13th May 2013 – 19th May 2013

General
The reserved judgment in the Paddy McKillen
appeal hearing in London is due any day now
IBF mortgage drawdowns for Q1,2013 due
Central Bank arrears/repossessions Q1,2013 due
Monday 13th May 2013
Eurogroup meeting Brussels
Tuesday 14th May 2013
EcoFin meeting Brussels
Wednesday 15th May 2013
Allsop Space auction in Shelbourne Hotel, Dublin
IPD UK commercial property indices April 2013
(CSO) Agricultural Price Indices March 2013
(CSO) Industrial Disputes Quarter 1 2013
Educn & Soc Protection Oireachtas comm: rent allowance
Thursday 16th May 2013
(CSO) Goods Exports and Imports March 2013
KBC Ireland Q1,2013 results
ECB Governing Council meeting
Good Friday Agreemt Oireachtas comm: Narrow Water Bridge
Friday 17th May 2013
(CSO) Trade Statistics February 2013
Saturday/Sunday

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NAMA features in latest Euromoney Research Guide

It’s Sunday evening, and you’ll enjoy this.

On Friday last, NAMA proudly published on its website the latest Euromoney guide to Ireland in 2013 where the Department of Finance, the NTMA, NAMA and the IDA each hold forth on how good things are in Ireland and how the recovery is well under way. No mention of the R-word at all, despite the country slipping back into recession according to the most recent GDP figures.

NAMA gets a page all to itself, and it really is a load of twaddle.

The regular audience on here will love the little box on the NAMA page which sets out how NAMA thinks it interacts with parties interested in buying its property and loans, and this is reproduced fully here

“NAMA will always engage with parties who have an interest in purchasing either a property that secures a NAMA loan or loans themselves and will actively facilitate engagement with its debtors/receivers. Individuals interested in buying a property that secures a NAMA loan are encouraged first to contact the owner or, in the case of a property subject to enforcement, the appointed receiver or administrator (a full listing of properties subject to enforcement is available under ‘Properties Enforced’ on NAMA’s website, http://www.nama.ie). Interested parties can also contact NAMA directly atinfo@nama.ie. In the case of both asset and loan sales, NAMA maintains a register of interested parties. When appropriate disposals arise, these parties are contacted by the relevant agents and given an opportunity to bid.”

For those of you who have contacted NAMA with multi million euro offers for loans or for property where there has been no response from the receiver/estate agent, the above may crack you up.

It is said that NAMA’s cash inflow to date of €11bn comprises asset sales of €7bn and “effective management of its assets” generating €4bn.

It is said that loan portfolio sales of €1.1bn are currently underway. Now, we know that NAMA has agreed the sale of Project Aspen which had a nominal value of €810m and sold for €195m, but the future of the €300m nominal value Project Club sale appears to be in some doubt.

For the first time, it is stated that NAMA intends spending €3bn on its portfolio, comprising the €2bn announced last May 2012 and a further €1bn which preceded that announcement. NAMA is to lend “at least” €2bn for vendor financing its asset sales.

NAMA refers to “recovery in Ireland’s commercial property market is already being supported by a substantial increase in investment by overseas funds attracted by the good yields available”. There may well be a recovery in transactions, but commercial property prices continue to decline with Q1,2013 down between 0.6-1% on the previous quarter, and rents down a stonking 3% in those same three months.

With respect to the IBRC assets which NAMA is to take over when the Special Liquidator sells as much as they can at prices in excess of an independent valuation, NAMA says that “depending on the volume of loans sold by the special liquidators to third parties, this could increase NAMA’s balance sheet by 50%” At the end of 2012, NAMA had balance sheet assets of €27.3bn, liabilities of €26.9bn and equity of €0.4bn. At June 2012, the latest date for which we have accounts for IBRC, the loan assets were booked at €16bn after provisions.

The report concludes “Brighter prospects for the property sector, twinned with NAMA’s successful track record since 2009, leave NAMA chief executive Brendan McDonagh confident about the agency’s prospects” What is omitted is the fact that both residential and commercial property are down 27-32% since November 2009, NAMA’s valuation date, and that according to the latest indices for both, prices are still declining. NAMA racked up a loss of €1.1bn in 2010, its first year of operation and is still nursing a €0.7bn cumulative loss. As Brendan told his Spanish audience last week, “the Irish market is very difficult, the economy is taking longer to recover than anybody expected and the financial institutions not in Nama are deleveraging as well. It’s a very competitive marketplace”

Euromoney Research Guides are published by an independent company, but this one is “published in conjunction” with the Department of Finance, the NTMA, NAMA and the IDA.

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Allsop Space mega property auction on Wednesday – preview

Where: Shelbourne Hotel, St Stephen’s Green, details here
When: Wednesday, 15th May, 2013 starting 10.00am (auctioneer announcements from 9.45am)
What: 125 Lots of residential, commercial and development property. The online catalogue is here. 38 commercial and investment Lots (with €10m max reserves) and 87 residential and land Lots – 55 houses, 21 apartments (Note as of this morning, four Lots have been withdrawn).
How much: Maximum reserves of €16.3m. Maximum reserves are an Allsop Space innovation and mean a price on a Lot which if met or exceeded at the auction, then the winning bidder is guaranteed to get the property. The actual reserve might be lower than the maximum reserve. It’s not that complicated! However for this auction on Wednesday, Allsop Space have introduced a  new concept for some of the Lots, a “reserve range” about which Allsop Space says the “reserve is guaranteed to be set within the two figures, giving the buyer a better indication of where the seller’s bottom line will be”

Estate agents are generally reporting that the residential market has been quiet since the start of 2013, but that there is strong interest in commercial and development property which is being converted into actual sales. Note this is an assessment on activity, price changes depend on property type and location, and reporting is mixed on that front – prime commercial property with new tenancy leases seem to be increasing in value, Dublin houses appear to be stable, most commercial property is still declining, and prices nationally including houses in some parts of Dublin are still declining though at a slower rate than previously – that’s all based on anecdote, the latest residential indices from the CSO are here, the latest commercial indices are here, Ireland doesn’t have development property indices but anecdote indicates there have been declines of 90%-plus from peak.

This coming Wednesday, we’ll see the 11th Allsop Space mega auction, a series of auctions which have transformed the business in Ireland and against which no Irish operation has so far held a candle – BTW has being doing a decent job on a smaller scale on the other side of the Border. The Allsop Space auctions have the highest standards of transparency with online webcasting and live online prices, and the venue again is the Shelbourne Hotel which at the opening at 9.45am on Wednesday is again expected to be packed with standing room only.

The Lots are again a mix of residential, commercial and development and as in previous auctions are scattered across the country with just 33% in Dublin. Just over half of the property is income-producing. There is an increasing emphasis on commercial property and in this auction, Allsop Space have modified their reserves for some commercial property, it says to give a better guide price.

Highlights includes

(1) McDaniels pub complex in Brittas Bay, Dublin. The 9,000sqft pub, restaurant and 10 bedroom accommodation comes complete with a holiday village of 16 chalets and 18.75 acres with sweeping views over the Irish Sea.  The Reserve Range is €625,000- €675,000.

(2) Farnham Court, Farnham Road, Cavan Town (pictured above).An entire development of 60 apartments located opposite Cavan General Hospital; 2 x freehold blocks of apartments, comprising 30 apartments each.  25 are currently let producing €127,000 per annum.  Reserve Range: €1.5 million – €1.7 million.

(3) Shopping Centre, Cardiff Bridge Road, Finglas, Dublin 11.10 tenanted retail units, all fully let with a rental income of €251,993 p.a. Some tenants dating back to the 1970s and 1980s.ReserveRange: €1.2 million – €1.3 million.

You can follow entertaining and informative commentary on the auction from Carol Tallon of Buyers Broker who will be tweeting here.

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Of the Week…

Secret of the Week

You might recall the commitment given by This Lot when they came to power to make public administration more transparent? Here is a selection – from the past seven days alone – of matters involving your money that This Lot weren’t referring to when they promised more transparency:

The Black Book which is the Central Bank’s disaster planning manual, first published in 2001, it was updated in 2007 after the run on Northern Rock in the UK. Minister Noonan said “The question of releasing the document is therefore a matter for the Central Bank of Ireland in the first instance. The document was shared with the Department of Finance on the understanding it would be treated in strictest confidence given the nature of the matters treated in the document. I do not therefore propose to provide a copy of the document”

The Collateral Posting Agreement which forces NAMA to hand over €1.15bn of cash to the NTMA as security against derivative contracts. Minister Noonan said it “contains commercially sensitive information and is therefore not suitable for publication”

NAMA & NABCO: The terms under which NAMA is providing social housing – which we have paid for through funding NAMA – to NABCO. Minister Noonan said “I am advised by NAMA that the particulars of the lease agreement, including term length and rental fee, have been negotiated in confidence with NABCO as a commercial counterparty and it would not be appropriate for the Agency to publish such details as it could prejudice the conduct or outcome of NAMA’s negotiations with other commercial counterparties”

AIB debt forgiveness: The debt forgiveness given to two large Irish media groups, Thomas Crosbie Holdings and Independent News and Media by state-owed AIB and 15% state-owned Bank of Ireland. Minister Noonan said due to “data protection rules and customer confidentiality the banks are not in a position to discuss details of individual customer circumstances”

Index of the Week

Yesterday, the consumer sentiment index jointly produced by KBC bank and the ESRI was published. This has to be one of the most volatile monthly indices you’ll ever see – you’ll see its history as far back as 1996, here; its peak was reached in 2000 at 130-odd, and throughout the downturn since 2007, it has been all over the place. It stands at 58.9 in April 2013, down from 60.0 in March but it was as low as 49.8 in December 2012 and 70.0 in August 2012.

Quote of the Week

“As I explained to the cardinal and members of the church, my book is the Constitution and the Constitution is determined by the people. That’s the people’s book and we live in a republic and I have a duty and responsibility, as head of government, to legislate in respect of what the people’s wishes are. Those wishes have been determined and set out by the Supreme Court, which determines what the Constitution actually means” An Taoiseach Enda Kenny responding to further rumblings in the Catholic hierarchy which has set itself in fierce opposition to proposals to introduce legislation clarifying the position on abortion

“Catholics understand therefore, that a vote for Sinn Fein is a vote for the weakening of the institution of marriage and the right to life for all the unborn” Fermanagh priest and columnist, Fr Owen Gorman writing in the monthly Catholic “Alive” magazine. Aghadrumsee priest Father Owen Gorman was writing in his column in the April 2013 issue of the magazine and suggesting that Catholics have started to support the traditionally-Protestant DUP, on religious grounds.

Yes, the abortion debate still hogs the headlines, and this was the week we found out that anyone involved in procuring or effecting an abortion was automatically excommunicated from the Catholic Church under Canon law 1398. Actually, we didn’t find this out at all because the old media couldn’t be bothered to develop the excommunication threat – that was mooted (and then dismissed) – to legislators who would vote in favour of the new Protection of Life during Pregnancy Bill.

Elsewhere, in this week’s noteworthy quotables:

“The traditional barriers of authority and hierarchy are lowered and you need to be able to manage accordingly” Guide issued by Fine Gael to its TDs and senators, helping them deal with the challenges of new media

Scourge of the Week

“When asked what the primary factors would be to motivate them to emigrate, the vast majority of respondents stated that they would emigrate primarily because of a lack of employment opportunities at home or in the expectation that they would have better job prospects abroad” Time to Go? emigration study by National Youth Council

This week, the National Youth Council of Ireland launched what it called a qualitative study of Irish emigrants, focusing on the young up to age 30. The 100-page report is worth a read, it is highly anecdotal in providing original source comments from actual immigrants, but at its launch on Thursday, the NYCI made clear that although there may be pull factors which make emigration attractive, the “determining factor” was lack of employment opportunities here at home. So, emigration may indeed be what finance minister Michael Noonan calls a “lifestyle choice” but this study shows that the “lifestyle choice” hinges on employment, and in a State where there are 430,000 on the Live Register and 295,000 unemployed equating to a standardized unemployment rate of 14.0%, there is really no free choice at all.

Goal-hanging politician of the Week

“You never once contacted our school, Griffeen Valley, in relation to our forthcoming school extension..neither did anybody from our board of management or staff contact you or seek your assistance in relation to the extension. You had absolutely nothing to do with this development, and yet you distribute a leaflet in the Lucan area claiming to have ‘initiated, led and delivered’ this extension..This is nothing but gross cynical opportunism on your behalf, which I find objectionable and depressing” Principal of the Grifeen Valley Educate Together national school, Tomas O’Dulaing speaking to the “Lucan Gazettes” 1st May 2013

Dublin Mid West Fine Gael back bench TD, Derek Keating came in for some criticism from a school principal in Lucan who resented credit being claimed on a political leaflet by Deputy Keating, for an extension to the school. The criticism made front page news of the “Lucan Gazettes” newspaper, which is in fact what they call a “free sheet”, in that it is free to readers and it is advertisers that fund it. Perhaps to spare his boss’s blushes, Deputy Keating’s assistant, Tommy Morris, was caught on camera – pictured here – removing copies of the newspaper from local outlets. It is now reported that some 3,000 copies were taken and the matter has been reported to the Gardai.

On their website, “Lucan Gazettes” which is part of the Dublin Gazettes group say they have 169,000 readers a week. Would that be a week when Tommy Morris isn’t active?

Job interview of the Week

Okay, this interview took place on 23rd April 2013, when 74-year old sports commentator and noted Fine Gael supporter, Bill Herlihy was “grilled” by the Oireachtas Joint Committee on Environment, Culture and the Gaeltacht about what he could bring to the role he recently won as chairman of the Irish Film Board. You will find the full transcript of the hearing here from page 19 but it will depress you; the hearing commenced with Bill read out an impressive pre-prepared statement. A Laois-Offaly FG TD asked what the IFB was going to do for Laois-Offaly, ditto for a Laois-Offaly FF TD, a Roscommon Independent TD asked about the decline in cinemas to the point there is only one cinema in county Roscommon, an Independent senator and a Labour TD promoted their own artistic endeavours and who knows, might be asking the IFB for a handout imminently and SF didn’t even ask a single question. After what appears to have been about five minutes of exchanges, the FG deputy chair of the committee concluded by saying “That concludes our consideration of the topic and I thank Mr. O’Herlihy for coming before us and giving us the benefit of his wisdom. I propose we notify the Minister for Arts, Heritage and the Gaeltacht, Deputy Deenihan, that we have completed our discussion with the chairperson designate of the Irish Film Board, Mr. Bill O’Herlihy. Is this agreed? Agreed.I will conclude with the words of a well known-television sports commentator, “Okey do-key””

Dontcha just love this country.

Poem of the Week

Crack

70,000.
Gone.
In a week.
Crack.
Actually.
A crack.
Was selling the gaffe.
Not quite breaking even.
A big improvement.
On borrowing to bail.
Then last week.
A bidding war.
It’s war. Baby.
Suddenly up 70.000.
All dandy.
Hands in air.
Wheeeeeee
Capitalist roller-coaster.
Enter the
ir  surveyor.
A crack.
Crack fluency required.
Enter my surveyor.
We’re looking at 10,000.
Fine.
But crack ‘s now a sobering force,
Sobering.
The purveyor of madness and rage?
So into equity’s duplicity.
Rode my 70,000
Plus 800.
The cost of.
My lesson in crack.

With Nobel laureate Seamus Heaney lying doggo during these historical times, it has fallen to others to chronicle economic challenges through poetry. We’ve had contributions on here before from sf ca writer. This week, the PoliticalWorld blog has launched its first foray into traditional publishing when it published a real-paper-book anthology of poems by Kevin Barrington entitled “I love the Internet” available for download here. Poems deal with the usual agonies of the human spirit but set against the unusual reality of current economic times such as the boom in property prices and then negative equity in the above piece “Crack”. Richly illustrated, worth a look.

Auctioneer marketing tip of the Week

Whatever about prices, there appears to be some consensus amongst estate agents that the commercial property market is humming with a reasonable flow of transactions at present, though residential property transactions have fallen off after the rush to meet the deadline of 31st December last when mortgage relief for first time buyers was curtailed. Corporate advertising by Irish estate agents and property companies seems to have intensified, but can any of them compete with the above Californian estate agent who has adopted a novel approach to self promotion.

What next? Maybe Messrs Hollis, FitzGerald, Nugent, Moran, Potterton, Meagher, O’Reilly and Hillyer might produce a barbershop chorus.

Baby pipeline of the Week

We found out this week the countries from which we are adopting children. In 2012, a total of 117 children were adopted from overseas. Russia has replaced Vietnam at the top spot of source countries for children adopted into Ireland, though that position was placed in jeopardy earlier this year when the Oireachtas joint committee on Foreign Affairs and Trade threatened to create a so-called “Magnitsky List” for Russia which would impose sanctions on those people suspected of being involved in the death of Moscow lawyer and accountant, Sergei Magnitsky who died in prison after his arrest when he was investigating state-level tax fraud. The Russians responded with their ambassador to Ireland threatening to close down the Russian baby pipelines if Ireland pressed ahead with sanctions. Just over a week ago, our fearless committee backed down and merely called for an investigation into the horrible death of Sergei. Elsewhere on the list, Ethiopia is number two, but you had better get in quick there before Madonna snaps them all up. On a serious note, adoption in Ireland is just so difficult that only 200 Irish children are adopted a year despite some 6,000 being in care. Last year’s Childrens Referendum may herald an increase by removing obstacles to adopting children of married couples, but for the time being, the foreign baby pipeline just serves to highlight our domestic failure to facilitate adoption.

Graphic of the Week

This was the week when the Central Bank of Ireland’s Fiona Muldoon – front-runner to take over Matthew Elderfield’s role following his resignation – unveiled what is a described as a “Pilot Scheme for Consumer Multi-Debt Restructuring”. It seems like a solo-run by the Central Bank, uncoordinated with the new personal insolvency schemes that are supposed to be available from the end of June 2013. And to cynics, it appears like a last-ditch attempt to minimize mortgage impairment losses at the Irish banks to the greatest possible extent. The Central Bank scheme envisages there being an independent “service provider” to manage whatever agreement is sought or entered into by borrowers, and feathers were ruffled when it was suggested the Central Bank might seek to engage a UK company, rather than one of the burgeoning bodies in Ireland providing debt management services.

A feature of the pilot brochure was a decision waterfall which illustrated how the indebted might deal with their debts. Lengthening terms and lowering interest rates are explored to the greatest degree feasible before there is any hint of a debt write-down.

 Book of the Week

Quite a number of people have asked when we should finally find out the names and dealings of the 60-70 people whose offshore account details were recently leaked, as part of the International Consortium of Investigative Journalists investigation. The 60-70 Irish had companies created in the British Virgin Islands, a jurisdiction which hides company control and dealings from prying eyes. In the UK, the BBC and the Guardian newspaper apparently received the master-file of the leaked details, and the BBC is nudged every so often to see when it will make available the Irish details.

Meanwhile the ICIJ has published an e-book (it’s free!) which brings together reports from various countries showing the impact of the leaked details. It is a fascinating read and although there’s practically no Irish revelation, the compendium of reports show how people have hidden their wealth and dealings, have suddenly become unstuck.

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NAMA’s provision of social housing continues to be a national disgrace

The good news is that the Housing Agency is now providing monthly updates on the number of residential property units – houses and apartments – sold and leased by NAMA for social housing. The bad news is that 18 months after environment minister, Phil Hogan did a victory lap when he trumpeted that NAMA would provide 2,000 homes for social housing in 2012, that by the end of April 2013, just 263 homes have in fact been acquired by local authorities and approved housing bodies. And of these 263 homes, 58 were in fact provided in the summer of 2011, before Minister Hogan’s announcement for 2012. And as noted on here previously, the failure to deliver the target is not NAMA’s fault.

NAMA has bent over backwards to make its property available for social housing. It has provided lists of 4,000 homes and extensively engaged with the Department of the Environment and others to deliver the homes. The fault for non-delivery is firmly the Government’s, and it is galling that the Government’s capital budget was underspent in 2012 to help met the deficit run up by Minister James Reilly’s Department of Health.

The latest figures from the Housing Agency say that the 263 homes provided by NAMA to date comprise 179 apartments and 84 houses. There are a further 76 homes – 3 apartments and 73 houses – where contracts have been entered into, but the homes are not yet completed. We learned in a parliamentary question this week, that of the 4,000 homes offered for social housing by NAMA, the Housing Agency and local authorities have “confirmed demand” for just 1,500 of these.

In respect of completions, we learned in April 2013 that NAMA had entered into a relationship with the National Association of Building Co-Operatives (NABCO). NABCO is to complete the construction of part-constructed NAMA housing and it will then be leased for social housing.  At the time, there was a statement on the NABCO website but it appears to have been removed today, and a search for NAMA or “national asset” on its website yields no results. In the Dail this week, the Sinn Fein finance spokesperson Pearse Doherty asked the Minister for Finance about the relationship and you won’t be surprised to learn the response was “I am advised by NAMA that the particulars of the lease agreement, including term length and rental fee, have been negotiated in confidence with NABCO as a commercial counterparty and it would not be appropriate for the Agency to publish such details as it could prejudice the conduct or outcome of NAMA’s negotiations with other commercial counterparties”

So, not much transparency on NAMA’s social housing dealings, either.

The parliamentary question and response are here:

Deputy Pearse Doherty: To ask the Minister for Finance if he will outline the arrangement between the National Asset Management Agency and the National Association of Building Co-Operatives; the number of properties to which the arrangement relates; the length of the lease terms; if NAMA is charging market rents; the location of the properties; and if he will make a statement on the matter. [21636/13]

Minister for Finance, Michael Noonan: NAMA, through its subsidiary National Asset Residential Property Services, has entered into an agreement to lease 13 houses in Cobh, County Cork to the National Association of Building Co-Operatives (NABCO). I am advised by NAMA that the particulars of the lease agreement, including term length and rental fee, have been negotiated in confidence with NABCO as a commercial counterparty and it would not be appropriate for the Agency to publish such details as it could prejudice the conduct or outcome of NAMA’s negotiations with other commercial counterparties.

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Is NAMA speaking out of both sides of its mouth on the Irish property market?

“The Irish market is very difficult, the economy is taking longer to recover than anybody expected and the financial institutions not in Nama are deleveraging as well. It’s a very competitive marketplace” NAMA CEO Brendan McDonagh, speaking in Madrid on 17th April, 2013

The NAMA CEO Brendan McDonagh was in Madrid last month at an event organized by the Irish embassy and moderated by the Financial Times. On 17th April, 2013 Brendan held forth on the Irish experience of NAMA, which is of particular interest to a Spanish audience given Spain’s inclusion of a so-called “bad bank” to deal with its banking problems. The joke on here before the seminar was whether Brendan would need an interpreter so that the audience would understand “billen” meant “billion”, “millen” meant “million” and “break even” meant a total loss of up to €15bn. There has been little reporting on the seminar which took place on 17th April but over the past day, Bloomberg has filed this report.

The audience in Spain is interested in the no-bullshit experience of NAMA because it now faces similar challenges with its bad bank, SAREB. And whilst NAMA seems to tell the domestic audience in Ireland at every opportunity that things are stabilizing, and that property prices are even increasing, the Spanish audience didn’t want that propaganda, it just wanted it straight.

And it seems Brendan told them “the Irish market is very difficult” which of course can cover a variety of factors including declining prices and lack of credit. But NAMA has announced €2bn of staple finance and is offering up to 75% loans to buyers of its property – mostly commercial but there have been instances of residential sales having staple finance also.

Back home in Ireland, NAMA talks about buyers participating “in the continuing recovery of the Irish commercial property market” – this is the market where prices were down 0.6-1% in Q1,2013 and rents declined by 3% in that same quarter. NAMA has been talking about stabilizing property prices since 2009, and since then, residential is down 32% and commercial is down 27%. And NAMA has been saying since 2010 that the property market is stabilizing. And although Brendan didn’t use the R-word in his reported words – sorry, no transcript of a speech has been made available – he did say that “the economy was taking longer to recover than anybody (sic) expected”.

Brendan also made reference to competition, which is not something we are used to hearing in Ireland – remember Minister Noonan telling us that NAMA didn’t compete with IBRC? – but the fact is that NAMA is competing with Bank of Ireland, AIB/EBS, Permanet TSB, Certus, Lloyds/Bank of Scotland Ireland, Ulster Bank/RBS, who have been deleveraging at a rate of knots. And it might not have been acknowledged by Minister Noonan, but NAMA is also competing with these companies for resources, like employees.

Sometimes, it is easier to be truthful with strangers.

UPDATE: 9th May, 2013. The presentation by Brendan on 17th April, 2013 is available here. It’s the stock NAMA presentation but a few slides are new. Haven’t seen this one before:

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