Mairead McGuinness says she will support ‘fair taxation’ in Europe

Ireland’s EU commissioner designate Mairead McGuinness has pledged to leave her green jersey “at the door” and insisted she will “strongly support” the EU Commission’s efforts to bring about “fair taxation” across Europe if she is confirmed next week.

She also addressed the issue of distressed mortgages and said the EU could not allow banks to sell off such mortgages “inappropriately”.

Ms McGuinness, who is vying for the financial services portfolio, faced questions from a powerful European parliamentary committee in Brussels on Friday with topics ranging from Brexit, a banking union, Covid-19, and green finance.

The Committee on Economic and Monetary Affairs, or Econ Committee, is due to make recommendations following the thee hour hearing before the matter goes before all MEPs in the European Parliament for a vote on October 7th.

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Brief

Financial services is a significant brief that involves working on the creation of a single market for capital in the EU, and leads reforms of the financial and banking industry aimed at strengthening stability and avoiding repeats of past crises.

“If approved I will be a European commissioner,” said Ms McGuinness. “I’ll leave my national hat at the door. I don’t wear one.

“My duty, if I am approved by this commission, is to the European Union – not to Dublin, not to my home town of Ardee, or any other town in the European Union or city. The mandate, if you give it to me, is a European one.”

Ms McGuinness added that there was “no conspiracy” in relation to the selection of another Irish citizen – Minister for Finance Paschal Donohoe – as president of the eurogroup.

“On the point about being Irish, I can’t do anything about that,” she said. “There was no conspiracy.

“I don’t think you should fear the Irish, we have ways of working that can help occasionally. I hope I can reassure you that we are not all on the phone to each other every hour of the day.”

On the issue of corporate tax, which Dublin has fiercely defended as a sole national competence and argued that its current policies towards multinational companies are essential for attracting investment, Ms McGuinness said it was “a contentious issue”.

“Work is going on at OECD level,” she said. “I think the commission – and I would support it – would like that we do this globally so that there is a move around taxation of large companies so they pay their fair share of tax and it is transparent.

“If it doesn’t deliver and the OECD process becomes bogged down in politics then the European Commission will come forward with taxation proposals and I support that.”

Mortgages

In response to questions from Irish MEP Mick Wallace, Ms McGuinness said the EU could not allow banks to “inappropriately” sell off bundles of distressed mortgages in the current climate.

“You reference the Irish situation, and there are lessons we can learn from it,” she said. “One of the big lessons is we cannot allow the bundling off of people’s homes to be sold on in a very inappropriate way.

“The connection between the borrower and the lender should not be broken when and if loans are sold on.

“I would be absolutely opposed to the bundling of mortgages that have got into trouble not because of any recklessness on behalf of a household but because rather than pandemic has closed a business or kept us all under lock and key.”

However, she added that it was essential to “keep banks lending”.

“If we don’t, and keep their non-performing loans on their balance sheet, it chokes off lending to the real economy,” she said. “But we should be able to do that in a way which does not disrespect the rights of consumers, particularly mortgage holders.”

Ms McGuinness also addressed recent controversy on the resignation of former junior finance minister Michael D’Arcy from the Seanad to become chief executive of the Irish Association of Investment Management (IAIM), the representative body for the funds and investment industry.

“On revolving doors, I disagree completely with that,” she said. “We have an agency in Ireland – the Standards in Public Office – I think they should look into this. I think revolving doors are extremely dangerous for stability.

“I think we need to be mindful that there are rules in our house, but also in the commission around what is appropriate or not for commissioners to do, because it sends out the wrong signal.

“I know in the financial services area that you have to work with the industry, but we also have to counter that with working with consumer groups. I think at the moment there isn’t a balance because consumers find it harder to come together.”

On the creation of a banking union, Ms McGuinness said she felt it was important for financial stability and for consumers. “In terms of banking union I think we should seize the moment,” she added.