THE GOVERNMENT is reviewing the nature of its involvement with the IFSC Clearing House Group, which oversees the development of financial services in Ireland.
A reliable source in Government has said the reappraisal of the group – which comprises top civil servants and representatives of the industry – followed criticism that the relationship between Government and the IFSC was too close; that it gave unfettered access to the sector to lobby in its own interests; and that the body was secretive and lacked transparency.
The Clearing House Group is chaired by Martin Fraser, the country’s top civil servant. It includes representatives from leading firms including JP Morgan, Citi, State Street, Barclays and Blackrock.
Records released under the Freedom of Information Act show the full extent of lobbying by the financial sector to resist an EU proposal for a financial transaction tax (FTT).
The body discussed the FTT a total of 13 times between October 2011 and May this year. The Department of Finance also encouraged the IFSC to supply it with information to allow it to argue against the FTT at EU level.
On October 11th, 2011, the department told the group “input from the IFSC sector will be crucial to informing our views on the proposal”. The following month, it said it was anxious to get examples of where the “tax would be duplicative, distortive, ambiguous etc”.
The language adopted by the Government on FTT largely mirrored the IFSC submissions. There is no evidence the Government invited submissions from any other group in society.
The IFSC also successfully lobbied for 21 changes to this year’s Finance Act, including a tax incentive for high-paid foreign executives and a €5,000 tax break for school fees.
Fianna Fáil finance spokesman Michael McGrath said the evidence pointed “to a very high level of influence being exercised by the IFSC on the Government in a way that other sectors such as retail and manufacturing can only dream of”. Labour MEP Nessa Childers said the Government promised transparency. “We not only need to know who is influencing Government policy, but more importantly we need know why,” she said.
