AS the legislation to establish NAMA was being finalised by the Government last week, the Greens launched a public relations offensive.
The Greens wanted to assure people that positive changes had been made to the bill that would afford greater protection to the taxpayer.
More importantly, the Greens wanted to make clear that they had been responsible for those changes.
Fianna Fáil, whose survival in office depends on the Greens, knew that NAMA was a difficult pill to swallow for their coalition partners. So they were happy to let the Greens at it, in the hope that the PR offensive would work.
Among other things, the Greens told us: “A risk- sharing mechanism has been agreed by Government which will deliver an equal sharing of the risk between NAMA and the banks.”
We have since learned that “an equal sharing” is, at best, a very optimistic interpretation of the Government’s proposals.
Under the risk-sharing mechanism, the banks stand to lose just 5% of the payment due to them – or roughly €2.7bn – if NAMA makes losses. By contrast, they will receive the other 95%, or €51.3bn, up- front.
The opposition argued yesterday that if the Government had been serious about an “equal sharing” of the risk, the banks would have received only 50% of the payment up-front.
The Greens’ other main wish for the legislation was the introduction of a “social dividend” clause. Under this clause, NAMA would, for example, have the power to assign land under its control for the construction of new schools, community facilities or social housing.
The Greens state that this social dividend is an essential condition for their support of NAMA. In his speech on Wednesday outlining what NAMA would entail, Finance Minister Brian Lenihan failed to guarantee the inclusion of such a clause.
Instead, he merely said NAMA “could” seek to help the Departments of Education and Environment in the provision of schools and parks. It “could” play a role in the provision of social and affordable housing. “Could”, not “would”. It was conditional and weak.
The Greens did get some things, however. Mr Lenihan confirmed, for example, that he would stitch into the legislation a provision introducing a windfall tax of 80% on profits from land rezoning.
But Green members want much more than that, judging by the outcome of the NAMA debate the party held last week in Athlone.
Another special party conference takes place next month, at which members will formally vote on NAMA and a revised Programme for Government.
A rejection of either would, as John Gormley conceded yesterday, result in the Greens walking out of government. That would be disastrous for the leadership, which clearly wants to stay in power.
But to manage that, the leadership may have to manage a political stunt akin to the loaves and fishes – taking very little and somehow magicking it into a lot.
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