FF are wrong to Oppose the Privatisation of Dublin Bus Routes.

The role of a party in opposition is not just to oppose, it’s to offer the voters an alternative. Yes, there is a part to be played as a watchdog, to scrutinise the government’s actions, to keep it on it’s toes… and it’s ok to score a few points from time to time. Why then am I getting the sense that we in Fianna Fáil are opposed to the privatisation of Dublin Bus routes for no other reason than the current government is in favour. Fianna Fáil, when in power, has never shied away from privatising a state company when the conditions have been right to do so and there has been a benefit to Irish people. Privatisations in the past have brought much needed investment into tired state companies, the private sector rationalisation of bloated semi states has delivered the essential modernisation that has enabled former state companies to not only compete but also to thrive. The world is changing and the need for the government to be directly involved in certain sectors and businesses is diminishing. As our society and economy move forward there is an onus on the powers that be to take stock from time to time and to consider what areas of the economy require direct government involvement and what areas no longer do so. Whatever the case for privatising Irish Water’s operating company, it is clear that we do not privatise the water infrastructure because this is a strategic asset and must remain under the secure control of government. On a daily basis hundreds of thousands of people in the nation’s capital city...

Irish Water Needs Professional Help

At tomorrow night’s meeting of Dun Laoghaire Rathdown County Council I will support a motion put forward by the Green Party to call for referendum to constitutionally prohibit the privatisation of Irish Water. The Irish Water issue has exercised most of the population and it is only right that the Irish people get to have some say on at least one aspect of the future of this entity. It is for this reason that I actively support the call to hold a referendum. If and when it comes to a referendum however I will not rush to support the notion that the constitution is altered in such a way as limit some beneficial opportunities that may arise. I am considering one in particular, where the corporate management of Irish Water is replaced with a private operator, I outline this in more detail below. Firstly, to be completely clear: Do I believe that Irish Water should be fully privatised? Absolutely not. One of the few things more dangerous than a public monopoly is a private monopoly. But I do believe that certain elements of this new entity that is Irish Water would benefit from the private sector treatment. The key argument against privatising any company is that out of public ownership that company is naturally motivated to maximise it’s profits, often this comes in the form increased efficiencies and investment in innovation, however often it comes in the form of higher customer prices, particularly if that company is in a monopoly situation. Even as a state owned company however Irish Water is already contributing to the profits of many others, the design company that charged...

Updated: Council Motion to Target Rates Reduction and Create 113 Jobs

Council Meeting 8th September: Motion on the agenda but no time at the meeting so deferred to the October meeting. Council Meeting 13th October: As we are so close to the budget it was agreed to take this motion directly to the Council’s Corporate Policy Group who will determine if and where it can be accommodated into the budget. People Before Profit tabled an amendment to the motion to cap the amount at a rateable value of EUR 60,000 and exclude businesses that are undergoing an industrial dispute. I can live with the latter but I would prefer to include a higher rateable amount. Amendment is also going to Corporate Policy Group along with the original motion. Budget Meeting 4th November: The cross party Corporate Policy Group opted to recommend a blanket 2.5% cut in commercial rates to go forward to the Council budget meeting for adaption, this means that my motion did not make it to the budget meeting. Obviously disappointed! I think we missed an opportunity to encourage enterprise, create jobs and better our county, I am determined to keep at this one……   Originally Posted 20th August: I recently put forward the following rates reduction motion to DLR Co. Council: Motion: “That this Council considers the establishment of a Commercial Rates Relief Fund equivalent to 2% of the 2014 Rates collection, and that this fund is used to pay the 2014 Rates bill of successful applicant businesses qualifying on the following criteria:  Receipt of assistance ensures that at least one full time job is either created or saved AND The qualifying business is either a start up or an existing business that...

What is the Purpose of the Strategic Banking Corporation of Ireland (SBCI)?

I welcome any initiative that encourages a flow of credit to small and medium sized enterprises in this country. In this regard I very much welcome the establishment of the Strategic Banking Corporation of Ireland (SBCI). At the same time I am concerned as to how effective this is likely to prove to be. The SBCI will initially make €800 Million available to Irish banks (and other TBD lenders) for onward lending to Irish SME’s. This fund has the potential to grow to €4Bn in time. The problem is that in September the European Central Bank offered Irish banks €8Bn which was partially intended for providing cheap credit to Irish SME’s. The Irish Bank’s largely rejected this funding, despite the fact that at 0.15% it is likely to be significantly cheaper than anything the SBCI can offer. Evidently the problem is not that Irish banks cannot access cheap liquidity. So what is the purpose of the SBCI?...

Banks Reject €6.4Bn Opportunity to Lend To Irish SMEs

It is concerning to see that Irish banks appear to have passed up on the opportunity to avail of the full €8Bn in cheap funding offered by the European Central Bank for onward lending to individuals and businesses within the Irish economy. Of particular concern is the demand for credit from viable SME’s that is very obviously not being met by lending institutions. The ECB’s €400Bn four year liquidity programme announced in June became available for draw down yesterday, Ireland’s share of this fund has been estimated at approximately €8Bn. The mechanism of this TLTRO programme is that member state banks can avail of a portion (7%) of their qualifying loan books on the condition that these funds are loaned on to Businesses (excl. financial intermediaries & mortgages) and Consumers (excl mortgages). There is no breakdown available of the actual amount of this funding drawn down by the qualifying Irish banks but early estimates put it at around 20% of their entitlement, this means that 80% or €6.4Bn of funding at 0.15% was not availed of. The problem arises during phase 2 of this TLTRO scheme, this is set to be significantly greater than the original €400Bn, any funding offered by the ECB under phase 2 will be a multiple of net new lending created by the application of phase 1. The upshot is that by not fully availing of this scheme Irish banks are not only denying immediate access to cheap credit by Irish business but they are also hampering the future competitiveness of Irish companies by shunning the opportunity to significant cheap funding in the future. There will be a second and final offering of phase...

Rent Controls are Short Sighted

There is a critical need to address the housing shortage in the Dublin area. Private and public sector building programmes must be encouraged in order to meet the growing demand for homes. Rents will stabilise, and potentially fall, once there is a marked increase in the housing supply. The accepted problem with rent controls is that they restrict the supply of housing. House builders and potential landlords are discouraged from investing in property due to the artificial cap placed on returns. Evidence from Abroad Sweden is a case in point. Rent controls have directly contributed to a housing crisis. Due to a fall off in development in the years following the introduction of rent controls a shortage of 40,000 units has arisen, mainly concentrated around major cities. Germany’s complex ‘Mietspiegal’ system is often cited as a success, however this must be viewed in the context of a falling population. The German government has acknowledged that a proposed tightening of this system will only succeed if done in conjunction with new tax incentives for home builders, this is because they are well aware of the effects rent controls have on supply. Ireland has a housing supply crisis, policies that further limit supply are short-sighted....

ECB Creates €8 Billion in Cheap Funding for Irish SME’s

I am very concerned about the lack of credit available to SME’s at this stage in our recovery. There is one upcoming opportunity that has the potential to create up to €8Bn of cheap funding for Irish SME’s, but only if the Irish banks get  both fully on board with the scheme and are also transparent about it’s operation. In June the European Central Bank announced the creation of a Targeted Long Term Refinance Operation (TLTRO), this is worth approximately €400Bn in the first phase of this operation. This essentially represents cheap funding for banks with the specific intention that it is advanced as credit to Businesses (excl. financial intermediaries & mortgages) and Consumers (excl mortgages). It appears that Ireland’s share of this fund will be approximately €8Bn. In relation to this actually becoming credit for Irish SME’s there are a few related issues that need to be monitored: 1) The rate banks can borrow at is the European Central Bank (ECB) Refinance Rate (currently 0.15%) + 10 bps, so all in 0.25% financing for the banks. If this money is loaned on to business then it should not be at a rate that creates excess profit. (e.g. if the bank charges 4.75% on the loan then they make 4.5% profit!) 2) There is a risk that Irish banks simply do not access the TLTRO and therefore forego an opportunity to increase business credit (they must apply by early September for the first tranche with a second opportunity to apply in December). Banks should reveal how much of the TLTRO they are entitled to (7% of their existing qualifying loan book) and more...

Council Motion to Target Rates Reduction and Create 113 Jobs

I recently put forward the following council motion to DLR Co. Co.: Motion: “That this Council considers the establishment of a Commercial Rates Relief Fund equivalent to 2% of the 2014 Rates collection, and that this fund is used to pay the 2014 Rates bill of successful applicant businesses qualifying on the following criteria:  Receipt of assistance ensures that at least one full time job is either created or saved AND The qualifying business is either a start up or an existing business that increases it’s long term viability by receipt of temporary financial assistance” I brought this motion for two reasons: Firstly, I believe that when we come to framing the 2015 budget we should give due and serious consideration to promoting local enterprises. As Councillors we are elected for a 5 yr term, and therefore have responsibility for the financial health of this county beyond the short term time frame of just the next financial year. We have many responsibilities and many services to provide on a limited budget. But we must also make sure that we have adequate resources year after year in order to be able to meet the financial demands of running the county. To create economic activity and enable future growth we must be prepared to invest. Commercial businesses and enterprises in the county provide a not insignificant portion of our annual income, it is therefore in our interest to take measures to ensure the continued growth and success of local enterprises. Our ability to provide services into the future is tied to the economy of the county. The second reason that I proposed this motion, is...