Gavan Reilly

thinking out loud

Five minutes well spent:

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Written by Gav

August 19th, 2010 at 2:47 pm

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How AIB’s gym fees more than double the amount it’ll make from increasing mortgage interest rates

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The front page of today’s Irish Examiner reports that AIB still offers to cover €2,500 per year in gym or golf club expenses on the part of its employees.

AIB is offering to pay employees’ golf club fees and leisure club memberships worth millions of euro every year despite being crippled with debt and facing massive job losses and a likely state takeover.

The crisis-ridden bank confirmed the generous staff perks scheme on the same day it raised interest rates for hard-pressed mortgage holders by half a percent – and just days after it announced record losses of €2 billion for the first half of the year. The interest rate hike will affect approximately 50,000 customers who hold standard variable mortgages. [more]

The piece goes on to say that the scheme is offered to each of the bank’s 12,500 employees in Ireland, as well as the 2,500 it employs in Britain. Up to €2,500, it says, is offered to each employee.

Meanwhile, the bank increased its variable mortgage interest rate from 2.75% to 3.25% yesterday, which will (it is reported) hit about 50,000 mortgage holders with a monthly repayments increase of about €27.

So this morning, after seeing the Examiner‘s lead, I decided to crunch some figures.

In the results it filed in March, for the year ending 31 December 2009, AIB said it had a residential mortgage book valued at about €27.1bn. In layman’s terms, that means that homeowners in Ireland collectively hold mortgages, from AIB, to the tune of €27,100,000,000.

How much of this €27.1bn is lent at a variable rate? Well, that depends on who you ask. This morning’s Irish Times estimates that about 30% of the bank’s mortgages are lent at a variable rate (thanks to Aaron Quigley for alerting me), while Karl Deeter from Irish Mortgage Brokers suggested to me that the variable portfolio amounts to about 20% of the total.

This is where it gets interesting. Yesterday’s Irish Times posited that the 0.5% increase in the interest rate would result in the monthly repayment increasing by €26.96 for every €100,000 outstanding on a borrower’s mortgage.

[Update, 2pm: I’ve crunched more numbers using slightly more mathematical formulae than those in the comments or, presumably, those used by The Irish Times. Using the c = (r / (1 − (1 + r) − N))P formula the monthly repayment works out at €26.96 for every €100,000 outstanding on a 30-year mortgage. The post previously stated an increase of €26.82.]

So, if 30% of AIB’s mortgages are lent at a variable rate (€8.13bn), then AIB stands to make an extra €2,191.848 a month from the increased interest rate – that’s €26.17 million a year. If as Karl suggests the rate is closer to 20% (€5.42bn), it will make €1,461,232 extra per month, or €17.44 a year.

Now let’s go back to the gym membership scheme. Though it’s unlikely, let’s suggest – as well most employees might want to – that every single employee claims their €2,500, there’s a chance that AIB is faced with 15,000 bills for €2,500 every year. That’s €37,500,000 a year for AIB employees to go to the gym or the golf club.

So, if 20% of AIB’s mortgages are at a variable rate, then the amount by which AIB is hitting mortgage holders – the vast majority of whom, we can guess, are in negative equity – doesn’t even cover half of its bill for sending its employees to the gym or golf club.

Let me repeat that. AIB is increasing its mortgage interest rates, when potentially more than double the amount it will make is being offered to send its employees to the gym every year.

It will take at the very least 17.10 months, and at most 25.66 months, for the increased mortgage rates to cover AIB’s annual cost for the scheme.

This is the bank that got a €3.5bn recapitalisation bailout from the taxpayer last year, will probably need another one to the same amount this year (according to JP Morgan, anyway) and which has been able to offload billions in loans to NAMA that it otherwise would probably never be able to get back.

Written by Gav

August 10th, 2010 at 11:07 am

The Upper House really does rule

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In the aftermath of the marathon debates on the Civil Partnership Bill, and inspired by Suzy’s far more eloquent blog post on the same topic, I wanted to try and cobble together some thoughts on the Seanad and its merits.

First, some background. Seanad Éireann, as I wrote in a piece for The University Observer in October,

is an imperfect institution. It is little more than a political car park for those postponing the inevitable decline into retirement; a breeding ground for a political party’s new hopes, trying to blood their new meat in the life of Leinster House before the savagery of the Dáil floor; and a consolation prize for those who came close-ish to winning a seat in the lower house in the previous election.

Its work is limited; its relative power to put a stop to legislation is nil; its members largely wish they were elsewhere. It’s a morose place where the good go to die and the young come to roar, all just to get a few minutes’ token coverage on Oireachtas Report three times a week for their trouble.

And, despite the chamber’s activity, this is a perception I think the Seanad has probably not done a whole lot to counter.

However, it does not need to be so, and the members of the House know it. In March 2009 The Late Late Show hosted a discussion (sadly no longer available which featured several members of the upper house arguing the merits of reforming the upper house to becoming an entity that the public had knowledge of, respect for, and trust in.

The Seanad, of course, has had its fair share of enemies in the past. In 1936, as Donie Cassidy saw fit to remind us on Wednesday morning, de Valera – frustrated with a Seanad full of independents and its hampering his legislative agenda – abolished the chamber completely, only to reconstitute it the following year. In the past, former PD leader Michael McDowell has been an outspoken critic of the House and demanded its scrapping – only to turn around a few months ago and say he felt it neither “wise nor beneficial” to scrap it, and to call for its reform last week.

That, of course, leaves Enda Kenny, who seems not to have noticed that should he conspire to lose the next election (an entirely plausible hypothesis) that the manner in which local councillors elect the majority of its members will guarantee an anti-FF majority irrespective of the Taoiseach’s nominees. Except a volte-face soon.

The Seanad and students: natural bedfellows

That volte-face, of course, will have been made all the easier to bare by the Seanad doing its best, as Suzy put it, to earn its keep this week. When I was involved in student politics, way back when, I ran for Chair of UCDSU Council because I loved two things: procedure and its application, and a decent debate. More than anything, though, I used to love the annual trip to USI Congress, and all because of Kissinger’s immortal words:

Student politics are the most vicious kind of politics that exist, because the stakes are so low.

While Kissinger’s edict is often interpreted in a cynical way, I choose to interpret it in a more well-meaning manner. Student politics are so vicious because the practical imnplications of their debates are not of a student’s concern. Thus, a USI debate on whether the morning-after pill should be available over the counter (to name one example that comes to mind) became an intense moral dissection of how such an act would play on society, and the slippery slides it may lead the country to.

The difficulty, of course, with being inside the circle of student politics is that it’s too easy to forget thaat such arguments will not lead to an immediate legislative shift. USI passing a motion calling for the pill to be over-the-counter does not mean that young girls can walk into a chemist the following day. But that real life implication is divorced from the debate: it’s all about the moral, the wrong and the right.

(The USI debate I mention, by the way, ended in a tie. Which, I thought, was a perfectly appropriate and meaningful result.)

I like to think of the Seanad as being in a similar conundrum, though naturally with the stakes raised. But watching Rónán Mullen and the Fianna Fáil dissidents argue the right of a civil servant to decline registering a civil partnership – because a truly liberal society, they argued with a degree of merit, shouldn’t force people to act against their will – rang a lot of the same bells.

The Seanad is, in de Valera’s original vision, that kind of chamber able to apply the Dáil’s hypotheses to the real world and critically analyse their merits in a way which the Dáil itself – handcuffed by the professionalism of the politicians who sit in it – cannot.

Sadly, this role is one that a further ingratiation with the Dáil itself – and, by the same virtue, the political ‘establishment’ – only serves to lose. Where those with commercial expertise should be easily electable to the Industrial Panel of the Seanad, they usually can’t – not, at least, unless they’re a member of a political party with a significant presence on local councils.

But this week’s debate – which debated, in a genuine sense, the merits and demerits of the legislation before it in a way the Dáil could never have managed – showed that the Seanad still has the capability to act in the way The Long Fellow would have wished for. Once the culture of free rein and conscience had been established by one FF senator deciding to jump ship, it made it all the easier for two more to join him. And suddenly, the usual rubber-stamping the Seanad gives to the Dáil’s work became that little bit more hard to come by, and the Seanad thus acted closer to the way it’s actually meant to. And when it works… by God, it works.

Ireland doesn’t work

The major problem with Ireland as a democracy is that the legislative branch simply doesn’t function in the way a legislative branch is supposed to. In other nations, a local MP is elected with only a minor responsibility to serve their constituents and a far greater focus on their legislative agenda. The Oireachtas, in short, isn’t meant to be a forum of local reps, it’s meant to be a body of lawmakers. And sadly, it’s largely anything but. We continually elect the likes of Jackie Healy-Rae to our parliament; people with every interest on making sure their name is emotionally attached to the latest main road linking two towns, and no interest in being the one putting their name to the legislation that actually builds it.

The Seanad, though, is our getaway clause. The Seanad is the area in which our legislators are not bound by culture to hold constituency clinics or to fight for the interests of the people from their locale who share their political hue. The Seanad is our chance to elect legislators who just want to legislate. People like David Norris, Joe O’Toole or Shane Ross. Lawmakers. Not public representatives, just parliamentarians, who want to be in the legislature because they want to legislate.

So let’s make it work

So, with that in mind, here’s a couple of quick ideas to get the Seanad going.

First of all, let’s give the Seanad a far shorter recess than the Dáil – and let the public know about it. Today’s news agenda was entirely sculped by the fact that the Dáil will be in recess for twelve weeks. Nobody seemed to remark for a moment that the Seanad will be sitting again next Tuesday, quietly getting on with things while everyone assumes they’re on holiday.

Further to this, given the fact that the Dáil isn’t sitting until late September, use the extra time wisely and get the Seanad sits to work through its backlog of undiscussed motions. Thursday’s Seanad order paper – listing all the motions and bills on the body’s agenda to be discussed – ran to 16 pages. While the Dáil is on pause, introducing new bills only adds extra work – but there’s a lot of motions, many of them apolitical, sitting on the agenda waiting to be discussed. The Seanad is our prime national debating forum. Let’s let it debate and play to its strengths.

Let’s also remove its image as a halfway house between the creche and the deathbed by holding Seanad elections directly alongside Dáil elections. Most people have contempt for the Seanad because it’s populated by people on their way into, on their way out of, or in between stints in the Dáil. By putting the elections at the same time, the Seanad ballot papers will be populated only by people who want to be on them. A house of parliament shouldn’t be somewhere people see as a silver medal. The Seanad, and Ireland, deserves better than being a consolation prize.

Let’s introduce the graduate reform programme we approved in a referendum 31 years ago this month (!!). Currently Trinity graduates get 3 senators all to themselves; graduates from UCC, NUI Galway, NUI Maynooth and UCC share another three between them. Those who graduated from two Irish universities get no representation, nor do any from the ITs. Let’s pass an act getting the institutions to hand over their graduate records, and task the NUI with maintaining a roll (they already do it for four big colleges, so why not?). Then merge the two three-seaters into one six-seater graduate panel, et voila – instant improvement in public profile.

Of course, all of that comes as a stepping stone before an actual Seanad reform. With people from every side of the House being in favour of making the Seanad more relevant, why not capitalise on that appetite – and the inevitable few months’ downtime between an election and the Seanad convening properly – to formulate universally acceptable ideas on what should change, and have them ready for approval as soon as things get going.

Let’s further divide the Seanad from the Dáil by having it not acknowledge party memberships. By all means, have a Government-sponsored minority (let’s perhaps allow the Taoiseach their discretion to keep their 11 nominees) to allow some coordination of the legislative agenda between the Houses, but having a stable of independents would require every piece of legislation to command a cross-industrial consensus. And if that means that legislation is restricted to the practical things we can all agree on, then that’s no bad thing.

And hopefully, all of the above will help give the Seanad its own identity. If it’s to survive and thrive, it’s going to need the public to believe in it. So plug its work and existence separately to that of the Dáil. That’s going to mean giving it its own significant presence on the imminent (Currently the YouTube channel is almost entirely made up of Dáil speeches.)

The future

The Seanad is a house of parliament of one of the countries most envied by the world. It deserves better than being a stepping stone or retirement home. It should be modelled to play to the strengths of those who want to be in it.

Perhaps someday, someday, it might what it deserves. Until it does, we merely get what we deserve for putting up with it being second best.

Seating plan for Dáil Éireann

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Update, January 25, 2011: This post has now been superseded by a similar site I’ve built elsewhere, called Who Sits Where?, and which can be found at

The post below links to the seating as of December 2, 2010, to account for the new seating arrangements on the opposition benches following the election of Pearse Doherty. This arrangement was superseded on January 25, 2011, when the Green Party moved to the opposition benches.


After watching a few electronic votes in the Dáil last week and being a little stumped as to why certain dots in the middle of the opposition half of the chamber were consistently showing up in green and not red, I went looking around for a copy of the Dáil’s seating plan.

I wasn’t able to find one anywhere online so emailed the clerk of the Dáil’s office looking to see if they could help; I got an email back this morning from Gina Long in the Clerk’s office (thanks, Gina) with a copy of the seating plan, and a list of who sits in which seat.

Given the amount of people who were keen to get a hold of  a copy of this when I went looking around on Twitter last week I’m throwing up the copy here for public reference. The chart and accompanying lists can be referenced when looking at the electronic voting display on Dáil broadcasts.

The seating plan was supplied in .dwg format so I’m uploading a .jpg copy here for the sake of easy access; the list of seats comes in two formats, one sorted by seat number and the other sorted by each TD’s surname in alphabetical order.

Written by Gav

July 5th, 2010 at 6:53 pm

Bloody Sunday, in numbers

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They say that numbers give a more distant perspective on things.

13 – the number of people who died on January 30, 1972 when they were shot British Army forces attempting to contain a Republican civil rights march in Derry.

14 – the number of people who ultimately died as a result of the Army shootings: John Johnston (59), an innocent passer-by, died in mid-June from injuries sustained after he was shot in the leg and left shoulder.

10 - the number of printed volumes of the findings of Saville's inquiry.

10 - the number of printed volumes of the findings of Saville's inquiry.

79 – the number of days between the shootings and the publication of the Widgery Tribunal findings.

90 – the number of witnesses whose testimony was heard by Widgery.

21,053 – the number of words in Widgery’s publication, including appendices.

9,417 – the number of days between the publication of the Widgery findings and Tony Blair’s announcement of a new enquiry, to be headed by Lord Mark Saville.

4,519 – the number of days between Blair’s announcement and the publication of Lord Saville’s report.

435 – the number of days of ‘Main Hearings’ held by the Saville Inquiry, which also held two days of preliminary hearings, two days of anonymous hearings, and five days of interlocutory hearings.

2,500 – the approximate number of statements received by Saville’s inquiry.

922 – the number of witnesses whose testimony was heard by Saville – over ten times the number called by Widgery.

30 million – the approximate number of words of testimony given to the Saville inquiry.

1,965 – the time, in days, taken by Saville and his team to prepare their full written report after the last day of hearings.

5,000+ – the number of pages in the printed edition of Lord Saville’s findings, split across ten volumes.

£190.3m – the costs incurred by the Saville Inquiry up to February 2010, including £15m in temporarily relocating to London to hear evidence from former soldiers who couldn’t travel to Derry over security concerns.

14,016 – the number of days between Bloody Sunday and the publication of the Saville Inquiry’s findings.

3,507 – the number of other people killed during The Troubles between 1969 and 2001.

Written by Gav

June 16th, 2010 at 12:27 pm