Most small firms now expect Nama to fail
Sunday August 09 2009
ALMOST two-thirds of Ireland's small business owners are not betting on the €90bn Nama gamble paying off.
A decisive 64.7 per cent of bosses do not believe Nama will sort out the problems in the financial sector. This startling finding of the Sunday Independent Business Owners poll comes only 10 days after the Government published draft legislation to set up the bad bank.
Less than 30 per cent of those surveyed believe Nama will be successful. The rescue plan for the banks, which gives Nama powers to take over land and development projects from borrowers who are not keeping up with their repayments, will end up costing taxpayers dearly if it fails. Almost €90bn of toxic loans will be transferred across to Nama and it is as yet unknown what kind of discount it will get when it buys loan books from the banks.
The more Nama pays for each loan, the greater the potential loss for the taxpayer. The less it pays, the greater the hit for the bank -- and the greater the need for the Government to bail it out.
With the exchequer deficit now €16.4bn, any move to prop up public finances by introducing a property tax will make the blood of most businessmen boil. A resounding 67 per cent do not believe the Government should introduce an annual property tax, compared with about one in four who said they would support such a move.
A new property tax -- as well as domestic water charges and a carbon tax -- are expected to be key recommendations in a report to be published by the Commission of Taxation next month.
Moves to beef up the dwindling public finances by slashing costs in the Health Service Executive (HSE) and Fas would get the thumbs up from business leaders, however. About 44 per cent of those polled cited the HSE as the state body or quango which is the biggest waste of money, while 26 per cent chose the State training agency, Fas.
Almost 13 per cent of those surveyed said Enterprise Ireland was the biggest waste of money, followed by the Financial Regulator at 10 per cent and Failte Ireland at 7.5 per cent.
- LOUISE McBRIDE
