herald

Sunday 22 October 2017

We should all be
concerned about 
power of Nama

Will Ireland soon have to be renamed Nama-land? The way that this huge and mysterious State body is expanding its power, that might not be such a crazy suggestion.

Five years after it was created to solve our toxic debt legacy, the National Asset Management Agency is transforming itself into a giant development company with the government's blessing - and yet it remains as secretive and unaccountable to the public as ever.

To be fair, Nama's plans sound wonderful on paper. It wants to transform the Dublin docklands into Ireland's version of Canary Wharf by investing €1.5bn in new offices, shopping units and residential buildings.

It also intends to spend the same amount on solving Ireland's housing crisis, with 22,000 units scheduled for construction between now and 2020.

Nama claims that all this is possible because its original mission has been so successful.

According to the 52-page report it issued last week, the agency will shortly be able to repay the entire €31.7bn that it borrowed to take over our banks' shoddy loan books. It is also fast-tracking the disposal of these assets, hoping to shift 80pc of them by 2016 and beating its original timetable by four years.

If the property market continues to recover at a rapid rate, then there is every reason to believe that Nama will ultimately make a healthy profit for the Irish taxpayer.

So what is the problem? Simple - it may well be the most brilliant state agency in Irish history, but the uncomfortable reality is that we only know what they choose to tell us and nothing more.

guessing

When Nama first started out in 2009, it was deemed to be exempt from the Freedom of Information act. While its chairman Frank Daly is no doubt a fine public servant, few Irish people would give him a second glance on the street. On the question of how much it has paid for any individual loan, you have a better chance of guessing next week's Lotto numbers.

This secrecy also applies to how Nama deals with property developers. Some are offered nice juicy carrots, with the agency reportedly about to give them financial incentives not to declare bankruptcy in Britain.

According to a briefing it gave the Department of Finance, initiatives such as greater profit sharing in future projects will stave off these builders' "debtor fatigue" and ensure a better return on their loans.

Other developers, however, just seem to feel the sharp end of Nama's stick. The most high-profile is Harry Crosbie, who spent €80m on creating the Bord Gais Energy Theatre and has now seen it go on sale for €20m.

He has accused Nama of trying to "bully" and "bulldoze" him as it tries to enforce a €77m judgement handed down by the High Court.

Selling the theatre would be "an uncivilised and barbarous act," Crosbie said recently. It was "an attempt to create something beautiful... it should not be treated like a warehouse outside Mullingar.

"This building has already become part of the cultural and social fabric of the city and should be treated with more respect."

Let's give Nama the benefit of the doubt. Let's assume that all the secrecy up to now has been necessary for commercial reasons. Let's also assume that it will meet its original targets, ahead of schedule and with a handy few quid to spare.

docklands

If Nama is about to balloon into something even bigger, however, then it absolutely has to change its ways. Regenerating the Dublin docklands and kick-starting Ireland's construction sector are massive projects with life-changing social consequences. They should be the subject of a major cost-benefit analysis so that at the very least we know exactly how our €3bn is going to be spent.

"We have a good agency, let's use it," was the typically laid-back reaction of finance minister Michael Noonan (inset) 
last week. This sounds suspiciously as if the Government is trying to outsource some of its responsibilities to faceless bureaucrats who cannot be held responsible when anything goes wrong. Our Department of Health tried that a decade ago by creating the HSE - and we all know how well that turned out.

If the current trend continues, this will soon be Nama's country. The rest of us will just have to live in it.

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