A DEFIANT Fine Gael remained entrenched in its opposition to NAMA last night, declaring the Government’s long awaited solution to the banking crisis needed to be remoulded from top to bottom.
Finance spokesman Richard Bruton accused the Government of going against the best international advice and landing the taxpayer with too much risk.
The banks needed fixing because of the “runaway property bubble” overseen by Fianna Fáil, he contented, adding that questions remained over taking over the banks loans.
The payment of €54 billion for the loans represented €34,000 for every family in the country, warned Mr Bruton.
“We are being asked to pay billions more than the market value for them. Remarkably this extraordinary act is being done without any forensic analysis of the costs and benefits, of the risks and threats.”
Fine Gael will continue to oppose NAMA even if the Government manages to pass through its plan. “If we get this wrong, it has the capacity to greatly prolong the recession and the haemorrhaging of jobs,” added Mr Bruton.
The party defended its own plans for a National Bank of Recovery, pointing to its successful use in France.
This alternative model was “effective, fair and with least cost to the taxpayer”, using funds from the European Central Bank (ECB) to immediately supply credit to businesses.
The ECB had recommended only paying market value for the loans but the government went against this advice by ultimately paying €54bn for properties valued at €47bn. The International Monetary Fund had also previously decided that politically supervised state-run asset recovery models, like NAMA, had generally failed to maximise the recovery of money from impaired assets, claimed Fine Gael.
The scale of the capital commitment was more than 10 times even the estimate of the cost of the Metro, it stressed.
“If the Government wins the day on the principle of their approach, Fine Gael shall seek to remould it in a way that will protect the taxpayer from a potentially very dangerous exposure,” Mr Burton added. “Instead, scarce money should be used to fund a National Recovery Bank that will get credit flowing to businesses at this crucial time, within four to six weeks, instead of nursing along impaired property loans which may never recover their value.”
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