Kieran O'Donnell (Limerick East, Fine Gael)

I support this timely motion. I wish to focus on the issue of the credibility of Government policy. In its counter motion, the Government states it has stabilised the public finances and regained credibility. When the European financial stability package was introduced here, the cost of our borrowing dropped to 4.7%, but it has drifted steadily upwards since and is now 5.29% for ten year bonds. The reason for this is the lack of credibility among the international markets due to the way the Government is dealing with the economy. It is also felt that the Government moved 14 months too late to make the required fiscal corrections. The current Taoiseach, who was Minister for Finance in 2007, should have moved in the December 2007 budget, but nothing was done until early 2009. In fact, Deputy Brian Lenihan's first budget as Minister for Finance in October 2008 did not deal with the issue either. Therefore, there is a credibility issue in the international markets.

Furthermore, the Government must borrow €45 billion over the next two years. This is necessary because the Government ran the country into the ground to such an extent that there was nothing left in the kitty for the rough day. If we have learned anything from the crisis, it is that we must provide a contingency fund. A certain amount of the budget each year should be set aside as a contingency fund - a kitty for a rainy day.

On the banks, the terms of reference for the commission of investigation have been published tonight. There are two interesting elements to note. First, the terms of reference do not take into account the actions of the Minister for Finance, the Taoiseach or the Department of Finance in terms of crisis management in the context of the banking crisis. Second, I note the coverage date has been extended to 15 January, which coincides with the nationalisation of Anglo Irish Bank, with regard to investigating the banks and investigating Anglo Irish Bank and Irish Nationwide. It is interesting that with regard to examining the statutory role and responsibilities of the Central Bank and the Financial Services Authority of Ireland, the investigation is limited to 28 September. I wonder why this is the case.

In the case of Anglo Irish Bank, a portion of the back to back loan between it and Irish Life & Permanent, €3.45 billion, came through on 26 September, but €4 billion of it came through on 30 September. Furthermore, accounts were produced by Anglo Irish Bank, under the watch of the Minister for Finance and the Department and of the Central Bank and the Financial Regulator, in December 2008 which overstated customer deposits. We had €7.45 billion of bank moneys going from Anglo Irish Bank into Irish Life & Permanent and then up to its subsidiary company, a life assurance company, and then returning to Anglo Irish Bank as customer deposits. This gave the impression there was greater liquidity. Clearly, people had concerns in terms of a run on deposits, which underlines their fears in terms of solvency.

There are questions to be answered. When we debate the commission of investigation tomorrow, two things must happen. First, the coverage date must extend to 15 January, the date Anglo Irish Bank was nationalised, for all elements of the investigation. The investigation must also include examining of the performance of the Minister for Finance, the Taoiseach and the Department of Finance in the context of crisis management of the banking issue.

The new business plan produced by NAMA is a disgrace. It has no cash flow projections for the coming years and no profit and loss account projections. This is unlike the original draft plan which, to be honest, was a fabrication because it relied on the figures provided by the banks themselves. This was ludicrous. The Minister for Finance failed to clarify that issue when we debated the NAMA business plan and we now find ourselves in a situation where, clearly, NAMA will make a loss. The Government has admitted this. Some 25% of the assets that went into NAMA are already gone. I would call them corroding assets. NAMA is like a juggernaut on the edge of cliff with five or ten people holding on to it, but it is rolling over the cliff and will, eventually, fall into the sea dragging the Irish taxpayer with it. We will be left with nothing more than toxic waste. What BP did in America will pale in comparison because it is the Irish taxpayer who is footing the bill here.

On the jobs crisis, some 290,000 people have been added to the live register since the Government took office. There are now approximately 450,000 people on the register. The Government has not addressed this issue. We must ensure we introduce policies that will create jobs. The Government has taken some of the elements of our NewERA document and I am glad to see it is now endorsing that policy.

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