Developers’ debts - One law for rich another for the rest

THOSE involved in nearly 200 repossession cases scheduled for the High Court in January — there will be many more during next year — watched Monday night’s RTÉ Prime Time with a special interest which probably turned into confusion and ended in anger.

They were not alone.

So too did the tens of thousands of individuals, families or businesses involved in fraught correspondence with banks over repayment schedules made impossible by deteriorating circumstances. Many of those worried, decent people will wonder why they did not follow the example of so many high-living developers and transfer assets to spouses to try to put them beyond the reach of their creditors or, hypothetically, the National Asset Management Agency (Nama).

The scale of the transfers by individuals, some with debts counted in hundreds of millions, more in billions, is spectacular. However, it more than likely only scratched the surface as it focused on property and did not have the scope to consider all assets.

The consequences of so many developers being unable to repay multi-million euro loans has done far more than scratch at the surface of this country’s banking system, viability, social protection structures, wellbeing and ambitions. It has undermined our independence.

It is not as if we really believe all the loans will be repaid in full but surely it can’t be helicopters, race horses in training, multiple homes in multiple jurisdictions, €600,000 Mercedes, multi-million euro Government rent cheques and a plutocrat’s lifestyle for ever for those whose greed has rocked this country to its foundations?

There are some developers who are repaying their debts and best of luck to them, they are entitled to enjoy the fruits of their labours but those who are not and are hiding assets are a very different matter.

Experience shows too it might be unwise to expect too much from the undoubtedly sincere declarations from Nama officials who promise they will pursue assets moved beyond their reach. The agency said it will go to the courts if developers did not return assets within a set time. Even in Christmas week expecting such a co-operative response is irrational. The sense of entitlement amongst developers remains robust so Nama can expect to spend considerable time and resources in the courts. That this national agency must depend on developers’ consciences shows the feebleness of our legal protections and deeply questionable political collusion in these matters. It points to the very kernel of our crisis.

Underlying the entire charade, despite ardent declarations to the contrary, is the absence of meaningful political will to confront this issue and recover assets now a liability on the State and its taxpayers. Taoiseach Brian Cowen and Finance Minister Brian Lenihan have made frequent and fine-sounding declarations of steely intent but actions speak louder than words. In this instance inaction speaks loudest of all.

The horse, a handy jumper in preparation for Cheltenham most likely, has bolted and it is only a matter of time before some Government minister sheepishly tells us that we cannot enact legislation respectively thereby confirming again that there is one law for the rich and another for the rest of us.

Change when it comes must be deep, fundamental and effective and it cannot happen a moment too soon.