Most of the news reporting on the Irish Auctioneers and Valuers Institute (IAVI) Annual Conference two weeks ago focused on the role of NAMA and impact of the economic crisis on the property market. But where was the attention to the elephant in the room – the very possible emergence of a two-track property market and its implications for the social and economic fabric of our communities? (more…)

In many ways this book bears many similarities to The Banksters by David Murphy and Martina Devlin covering much of the same time period and events. It discusses the crisis currently facing Ireland paying particular attention to the personalities, relationships, political and economic culture, and power relations at the centre of the current storm.  It begins particularly effectively with a prologue highlighting in a very simple way the unhealthy relationship between regulators and bankers, a theme that dominates the book. While other writers have laid the cause of the crisis firmly at the feet of certain individuals, this book differs in that it highlights the systemic failures of the banking system, regulation, politicians and civil service or the ‘mandarins’ as Ross refers to them. In fact, it is the scathing nature with which this latter group are dealt with that particularly distinguishes this book from the Murphy and Devlin text.

The Bankers is an exceptionally well-written and well-researched book and is an absolute pleasure to read. There is a sense that this text was a long time in the making; it is carefully crafted, questioning, provokes thought and pulls no punches. Rather than merely reporting fact, Ross goes behind the scenes and the level of minute detail that he brings to the story is remarkable. It is clear that the author received exceptional levels of cooperation from a range of insiders and it is little wonder that many of them wished to remain anonymous given the information that was provided. The collusion between a range of state agents and the private sector to maintain a system that worked in the interests of those in power (be it political or economic) is breathtaking. Worryingly, one is left with the feeling at the conclusion of the book that not much has changed. While new institutions, such as NAMA are currently being established, the culture that permitted the crisis to develop does not seem to have fundamentally changed.

This book is well worth a read. If one is looking for a basic synopsis of the facts of what has happened in Ireland since the beginning of the international banking crisis, then IDavid Murphy and Martina Devlin’s The Banksters is a basic starting point. However, if one wishes to read a more in depth and nuanced account of how we got to where we are today, as well as one that focuses on the range of systemic failures beyond just the banking sector, then The Bankers is a must-read.

Niamh Moore

In the run-up to Budget 2010, many estate agents reported potential buyers holding off on purchasing a new home in the hope of some change or incentive to aid their investment.  While a significant number of Sale Agreed signs appeared in suburban neighbourhoods, sale completions were on hold pending the outcome of the budget.

Granted Budget 2010 extended mortgage interest relief for first time buyers to 2017, but effectively the budget did nothing to stimulate the housing market (more…)

NAMA – Who are we?

We could get into a philosophical argument but the Interim Managing Director of NAMA says:

“A State agency with a commercial remit to implement Government policy and legislation passed into law by Oireachtas”.

Presentation given by him today seems to illustrate the same old approach and mindset. Just look at the language carefully – so much for innovative thinking!

http://www.nama.ie/Publications/2009/NAMAPresentationNov2609UCD.pdf

Niamh Moore

As it has been for over a decade, Dublin Docklands is still making headline news but in the current economic crisis it is for all the wrong reasons, What has transpired in this part of Dublin city over the last decade epitomises the best and worst of Celtic Tiger Ireland. It is indisputable that a major transformation has occurred making the area unrecognisable from the docklands of the late 1980s and many improvements have been made in areas such as housing, employment and education. But for over two decades, local communities and others have questioned the means employed to achieve this regeneration and the role of the state and its partners in fuelling what was perhaps one of the greatest speculative booms ever generated.

According to weekend media reports, two independent investigations into the financial and planning activities of the Dublin Docklands Development Authority (DDDA) have been commissioned by recently appointed Chair of the Board of Directors, Professor Niamh Brennan.  One of the key impetuses leading to an emergent questioning of the activities of the DDDA has been the disastrous consequences of a decision by the DDDA Board to enter a partnership arrangement with Bernard McNamara and Derek Quinlan to purchase the Irish Glass Bottle site for €413million in late 2006. Writing in the Irish Times on 4 December 2006, John McManus questioned the ethics of a State development agency getting involved in such a massively leveraged project highlighting the conflict of interest inherent in the DDDA acting as co-developer and planning authority. As recently as last month, this site was devalued by 85% to just €60million. Originally financed by Anglo-Irish bank and subsequently transferred to AIB, it is likely that these loans will be transferred to NAMA so the tax payer is exposed by a state agency for the second time to significant risk on this one site.

Yet the Irish Glass Bottle site is only the most visible project on which the activities of the DDDA have been less than transparent. The controversy over the redevelopment of the Stack A warehouse in the north docklands, now known as chq, highlighted the total lack of transparency and accountability within the DDDA. In internal confidential correspondence at the Department of Arts, Sport and Tourism, one senior government official argued that ‘it is the view of this division that [the DDDA] setting this target range for a brand new museum is tantamount to vetoing the concept’. In a clear case of the tail wagging the dog, the unlimited and uncontrolled power of the DDDA to force Government acquiescence on key projects within the docklands is a matter of serious concern.

But why has it taken a financial crisis for the activities of this state agency to come under such scrutiny? How could it have been considered acceptable practice for a state agency to become so entangled with private sector interests and a solely profit-based vision of acceptable land use and functions? But lest we get carried away, the reports about the DDDA are just the latest in a series of revelations about the actions of some state agencies during the boom. What is more worrying is that while there were many people sounding the alarm bells they went unheeded for as long as the boom party remained in full swing. Even those at the heart of Government seemed to brush aside the questionable tactics of some state agencies. For example on the morning that the news broke that the national public transport company (CIÉ) had entered a private partnership arrangement with Treasury Holdings to form the Spencer Dock Development Consortium, the Minister for Transport and by extension the cabinet had no knowledge of it. CIE pitted themselves against other state agencies such as the DDDA and Dublin City Council in the bid to profiteer from this prime site at the heart of the north docklands.

So this maverick buccaneering approach appears to be almost systemic among some state agencies. Appointments to the Boards of the DDDA, CIE and other state agencies including NAMA are within the gift of the relevant Minister. If the failure of these Boards to perform their scrutinising function with relevant local government officials, accountants, consultants, bankers and others literally ‘on board’ why will NAMA be any different? If the Government has failed to do its job and control the operations of these other institutions, will they succeed with NAMA? If the same political ideology underpins decision-making, will we just have old patterns repeated? Will we ever know what the taxpayer has taken on, at what real cost and to whose benefit? It is time to broaden the scope, to appoint people with no vested interest in the operation of these agencies. Maybe with a bit of common sense prevailing the job that state Boards are tasked to do will actually get done. Now is the time to make the change. Although unlikely, NAMA could be the first step in a new dawn for Irish politics if only the Minister goes beyond the same old tired faces.

Niamh Moore