Last night, during a Dáil debate on a recent EU summit, Fianna Fáil leader Micheál Martin gave a speech in which he took issue with Fine Gael leader and Taoiseach Enda Kenny’s reaction to the Anglo Tapes story.
Speaking in the Dáil, Mr Martin said:
“The Taoiseach has repeatedly said he knows nothing about what happened when the Bank Guarantee was brought in. He says he would “love to know” what happened. If we put aside the lengthy statements and interviews, including in this House, this claim of the Taoiseach’s is transparent, partisan nonsense.”
“For two and a half years he and his ministers have been in full control of government. They have had absolute access to the many records of events, particularly those contained in all of the documents retained in the Department of Finance. More importantly they have had access to the officials who were present at all stages of the Guarantee process.
Minister Noonan has actually refused to release some information under FOI so Taoiseach you cannot have it both ways.”
“In the Taoiseach’s case, for an entire year he had at his side the most senior official present during that night. Is the Taoiseach expecting us to believe he never asked him any question about the meetings he attended?”
“The next most senior official who was in the room that night also worked closely with this government for well over a year.
He regularly attended the Economic Management Council with the Taoiseach, Tánaiste, Minister Noonan and Minister Howlin at which bank-related debts were discussed. Did you ask him no questions during that time?”
The Irish Independent,today reports that the Government may sell Irish Life to the owner of Canada Life Insurance, Great West Lifeco, “within months”.
You may recall a previously planned sale to Great West Lifeco, which bid €1.1billion for Irish Life, was called off in November 2011.
The collapse in talks was largely blamed on market volatility in the eurozone at the time.
But of course potential buyers had raised concerns surrounding the implications of any investigation into Irish Life’s role in the €7.2billion ‘window dressing’ loans between Irish Life Permanent and Anglo Irish Bank.
Loans which, it is understood, were approved by the former secretary general at the Department of Finance Kevin Cardiff (above), who is now working at the European Court of Auditors.
So presumably the purchasers are satisfied there will be no legal action arising out of these loans. And Kevin can go back to his waffles in peace.
1) A number of senior and mid-ranking officials at the Department of Finance?
2) The person whose job it was to spot these errors?
TWO OFFICIAL reports on the €3.6 billion discrepancy in the Government’s debt figures have concluded there was duplication of effort between agencies, failures in communications and reporting, as well as lack of resources for key statistical work.
An internal Government report prepared for the Department of Finance and an external review carried out by consultants Deloitte and Touche have both concluded the responsibility for compiling the statistics should rest with one agency, the Central Statistics Office, rather than it being shared with the Department of Finance.
Lest we forget…
The secretary general of the department when the accounting error occurred, Kevin Cardiff, was rejected for the post of European Court of Auditors by a budgetary committee of the European Parliament by one vote in November last year. The European Parliament later overturned the recommendation by the budget committee to nominate Mr Cardiff to the post which carries a salary of €276,000 per year.
The former General Secretary at the Department of Finance, who oversaw the September 2008 bank guarantee and a (still unexplained) €3.6 billion accounting error in the State’s books, before being parachuted into a €276,000-a-year job in the European Court of Auditors, has given an irony-soaked interview with an in-house EU journal.
On watching out for risks: “I think there has to be a careful balancing of the work priorities to make sure that we address the areas of risk and interest for Europe. By interest I mean Europe’s policy interests not just those things that are interesting in a gossip sense.”
On Renaissance Italy: ”…the Court (of Auditors) stands as an institution itself, so it is not a question of whether it becomes like the Guelphs and the Ghibellines in Renaissance Italy, attaching itself to one party or another.
On performance audits: “…I have been very impressed by some of the performance audits. I also think we need to focus the performance audit on the outcomes of European effort, not just on the systems and procedures but also on their effectiveness. Of course, there are limits to what an auditor should do, but to be able to really add value one has to be able to say what could change, what could be different, not only to allow all systems to be more efficient, but also to allow programmes to be more effective.”
On Ireland’s financial woes: “…Ireland is a country in a sort of transition. We have had a very deep recession and at this stage we have already had several years of economic adjustment. The adjustments occur at a cost for the citizens. The fiscal adjustment is essential but it is very painful.” “…the bond yields have fallen very significantly. In the perception of the markets, Ireland has appeared to create an identity of its own and there is a real potential there for Ireland
to access market funding in its own right and not rely purely on the EU and IMF programme support. Indeed, Ireland recently made a small fund-raising in the market, short-term money, but nonetheless it was a very good first step.”
A shout-out to the little guys back in Ireland: “..there is a rebalancing of economists’ and markets’ opinion about Ireland, which is a result of concerted and determined efforts over a long period of time. But those efforts are at the cost of taxpayers and citizens who have to manage with fewer services or manage with less pay or higher taxes.”
On the possibility that he could be working on the European Stability Mechanism (ESM): “..That is a very interesting development because the new ESM will have its own particular character and structure and it must be properly audited. We should, as I said earlier, be available as a resource for European efforts, and this is one of the ways in which we are available to assist.”
On ‘naming and shaming’ those who break the EU rules: “..Our focus has to be to give a fair and balanced opinion based on the information we have, and to give it in a way that provides the stakeholders with the information they need to decide whether to be reassured or whether intervention or change is necessary. We are neither journalists nor prosecutors. This is an audit institution and it needs to focus on its own objectives. If that sometimes means providing information that includes the names of countries or institutions,, why not, but it is not about providing a particular story, it is about providing the informational base for decisions. As long as we stick to that priority, we get the balance right.”
From The public accounts committee meeting on the “Debt Discrepancy In The National Accounts”, November 3, 2011.
Shane Ross: “I will ask just a final question before I depart. Mr. Cardiff is due to head for the European Court of Auditors shortly.”
Kevin Cardiff: “Yes.”
Ross: “Will Mr. Cardiff assure the committee that he will see this matter sorted before he departs? As he stated, it is his responsibility.”
Cardiff: “Yes. Accounting Officers must take responsibility for issues such as this and see them through. It was to allow this to happen that I stated that I would hope to have the external report on this by the end of the year.”
Ross: “Mr. Cardiff will not depart until this matter has been resolved satisfactorily.”
Cardiff: “My departure is not entirely in my own hands, but I will press hard—–”
Ross: “Mr. Cardiff cannot depart without his own consent.”
Cardiff: I am not sure about how true that is.”
Ross: “Does Mr. Cardiff have something to tell us?”
Cardiff: “No. In a technical legal sense, I am not sure that the Deputy is 100% correct. I will try hard to get this done before I go. Sometimes, a fresh pair of eyes can see things that the existing person cannot.”
Ross: “Mr. Cardiff has responsibility. He is one of the two principal players. It would be wrong if he left the Department of Finance in a shambles, where its systems were not satisfactory and where something such as this could recur. It happened on his watch and he should not go to Europe until this committee, the Department and the Minister are satisfied that this problem has been resolved. Will Mr. Cardiff give us that guarantee?”
Cardiff: “No, I will not.”
Ross: “Mr. Cardiff will just float off and leave the problem here…”
MINISTER FOR Finance Michael Noonan was told by his department’s officials last year that a €3.6 billion accounting error had only “recently” come to light despite a paper trail stretching back more than 12 months.
In a briefing note for the Minister, prepared on October 28th last, he was told the National Treasury Management Agency (NTMA) “have recently drawn to our attention” a double-count of money borrowed by the Housing Finance Agency.
However, internal documents show there were at least 20 emails between the National Treasury Management Agency and the Department of Finance’s general government section relating to the matter between August 23rd, 2010, and October 25th, 2011.
The issue centred on the fact that exchequer money being loaned by the NTMA to the Housing Finance Agency was being counted twice as debt and overstated the national debt.
The issue became public knowledge on November 1st last year, after the department issued a statement following inquiries by TV3 News.
You’ll recall how, at the time, former Department of Finance Secretary General Kevin Cardiff ‘was puzzled too.’
This month Kev takes up his €276,000 per year gig at the European Court Of Auditors.
Pat Neary. Financial regulator: €630,00 pay-off plus public service pension of almost €143,000 a year, €2,750 per week, for the rest of his life.
Kevin Cardiff, former General Secretary of The Department of Finance. Now a member of The European Court of Auditors on a gross salary of around €180,000 a year but a net salary of €140,000 due to the low tax rate on EU salaries. The post, which is normally for a period of six years, “also involves generous pension arrangements which amount to half salary for the three years immediately after serving in office and a pension of 26 per cent of salary after that”.
December 2004: After failing to succeed Sean Fitzpatrick as Chief Executive of Anglo , Tiernan O’Mahony (above left) leaves the bank and sets up International Trading Securities Trading Corporation (ISTC). According to ‘Anglo Republic’ Fitzpatrick “opened his contacts book” and helped O’Mahony tap investment from Anglo’s main customers including Denis O’Brien, Sean Quinn, Johnny Ronan, Paddy Kelly and Seamus Ross.
February 2008: Investors in ISTC are forced to write off losses of €820 million, at the time the biggest cash loss for an irish company. The firm has just €57.8 million to cover liabilities of €878 million.
September 25, 2008 (8.30pm, but not listed in Kevin Cardiff’s appontment book above): Tiernan O’Mahony meets Kevin Cardiff at the Department of Finance to offer suggestions on whether the government should guarantee the banks. According to the Sunday Independent: “Mr O’Mahony told Mr Cardiff, according to well-placed sources, that the State needed to consider some form of a guarantee to restore confidence to the market and halt the flow of billions in deposits out of Irish banks.”
November 12, 2008: ISTC suspends trading in its shares, postpones publication of its financial results and scraps plans to raise €150 million in a last-minute rescue attempt by financier Dermot Desmond (source: ‘Anglo Republic’).