The Select Committee of Tynwald, established at the July sitting of the Court, has issued a call for interested parties to submit evidence on the first two parts of its remit: firstly, the cause of the collapse of the bank in October 2008; and secondly, the roll of the Financial Supervision Commission (FSC) in ensuring the proper management of KSF (IOM) to protect depositors’ funds (or perhaps its failure to do so).

The resumed debate, adjourned at the May 2009 sitting, as expected, resulted in an agreement to form a Committee, rather than an independent public inquiry; and produced no particular controversial comments from Tynwald Members.

The main controversy, as usual, revolved around the antics of Members in appointing the three Members to sit on the Committee.

For some odd reason this important, serious and essential roll of the Parliament, to scrutinize issues of concern, always seems to provoke hilarity amongst members when it comes to electing colleagues to sit on such Committees.

The game appears to be to try and elect Members on to the Committee because they do not want to be on it, or it is considered a bit of a laugh to nominate someone for the sheer hell of it, rather than they will be the Members best suited to undertake the work.

This occasion proved no different to the norm with at least one of the nominated candidates trying to persuade Members not to vote for him. As it turned out they were unsuccessful and managed to get elected on to the Committee.

When approached a few days later by the Manx Herald, to state, in view of his reluctance to be on the Committee, if there would be any lack of commitment, on their part, to see that a thorough investigation is undertaken, Mr Lowey, MLC said he understood the reason for the question but, having been given a job to do by his colleagues, he would do it to the best of his abilities.

He explained he knew it will be a long, hard and timing consuming investigation, which would significantly impact on the time available for other political work; and it was for this reason alone he had hoped to avoid being elected on to the Committee.

Mr Lowey is joined on the Committee by Rushen MHK, Juan Watterson, who has been elected Chairman, and North Douglas MHK, John Houghton.

Mr Watterson is a relative new boy to Tynwald, who has accountancy and auditing background, so the Manx Herald is sure he will be looking to enhance his reputation by producing a comprehensive report.

The issue clearly deserves a thorough investigation and the victims of the bank collapse have high expectations that any failings by individuals or systems will be identified; and those responsible held properly to account. The Manx Herald also expects no less and will be observing the work of the Committee very closely.

Submissions are required, in writing, to the Committee secretary, Ms D Smith, by 25^th September 2009, and can either be emailed to deborah.smith@tynwald.org.im or posted to Legislative Buildings, Douglas. IM1 3PW.

In a separate development, Tynwald voted through an amendment to the Depositors’ Compensation Scheme (DCS) to enable up to £193m of reserves to be used to fund the DCS and speed up compensation payments to KSF (IOM) depositors.

As the scheme stood, with it being an ‘unfunded’ scheme, it could have taken a considerable period of time to raise the contributions necessary, from Government and financial institutions, to fund the payments. It is now predicted a single payment will be made in August or September; but, unsatisfactorily, it still amounts to the best part of a year after the bank collapsed.

Essentially the Government is providing an interest free loan, of £120m, to the Scheme (and the banks) and underlines how the Scheme was more a ‘positive marketing’ tool for the financial services industry rather than a credible method of compensating depositors in the event of a failure of an IOM licensed deposit taker.

This latest amendment also highlights the inferior ability of the IOM, and other small jurisdictions, to provide the same level of cover as other financial centres, such as the UK. The proposal clearly falls a long way short of the 100% guarantee of retail deposits by the UK and others; and the much faster compensation payment payouts being made elsewhere; but it appears to be all that is on offer.

The proposal received almost unanimous support, with only Onchan MHK and Liberal Vannin Party Leader, Peter Karran voting against.

The Manx Herald was disappointed, but not surprised, when, during the debate, none of the Members questioned Treasury Minister, Allan Bell how he had managed to pull another £20m out of the hat, when no further money had previously been on offer to make the doomed Scheme of Arrangement more attractive to voters. It had seemed, to the Manx Herald, as the KSF (IOM) shambles lurched from one crisis to another the Treasury persuaded Tynwald to stump up more funding; but no satisfactory reason had ever been given why or how the figures put forward had been arrived at – they always seemed arbitrary figures.

Initially £150m was set aside, which later rose to £173m before topping out at today’s £193m. Moreover, it begs the question is this the final amount or could more be made available if pressure mounts to find a comprehensive, and for the depositors, a100% satisfactory conclusion to the sorry saga?