Pat Rabbitte (Dublin South West, Labour)

This document is a straitjacket. I doubt whether the Ministers of State, Deputies Roche and Mansergh, knew about it. Certainly Deputy Fahey did not know about it. He came in here and asked what would happen the middle class of Ireland if the Labour Party came into government and introduced a property tax, without knowing that the property tax is contained in the document and signed up to by the Minister, Deputy Brian Lenihan, and the Taoiseach, Deputy Brian Cowen. In case they were unhappy with bringing in the property tax, they make provision for it to be increased in subsequent years.

The new Government will be in a straitjacket and is getting a hospital pass from this Government. It seems to me the Opposition made a mistake and it may as well be admitted. My party considered a motion of no confidence in this Government some weeks ago when this broke. We decided, to use the hackneyed phrase, in the national interest not to proceed because the Government was about to publish a four year plan and it was in negotiations with the IMF, the EU and the ECB. We decided it would not be responsible. It seems to me we have made a big error and a mistake. We ought not to have let this Government carry out the negotiations with the IMF and the EU because it has given us a document that ties the hands of any future Government in this country for more than the next three years. We ought not to have permitted the members of Government to do so because they have gone, knowing they will not be here, and agreed to whatever was thrown at them.

Earlier, Deputy Burton dealt with the implications, as we see it, of taking €6 billion out of the public finances in this budget. I endorse everything she said in that regard. The Minister may correct me if he knows differently but my information is that the IMF agreed that to take more than €4.5 billion out of the economy in the coming budget would send us into a further tailspin in terms of growth and employment. Of course, the Government, always being one step behind the action, had already committed to €6 billion in cutbacks in the vague hope it would stave off the IMF and be able to source money in the markets at a cheaper price. It had already sold the pass but the markets responded by raising interest rates on bonds.

Deputy Fahey came into the House to wave around his written script and ask me why I did not intervene with the chairman of Allied Irish Banks when I saw the explosion in credit. His case rested on the fact that I had sat in Cabinet with an Attorney General who subsequently became chairman of Allied Irish Banks. Deputy Fahey demanded I answer this case. Will Deputy Fahey answer this? Why did his buddy, the Taoiseach, Deputy Brian Cowen, when Minister for Finance, not intervene with the chairman of Allied Irish Banks, especially as he had the figures and I did not? It was his job to supervise the regulation of the banking system. The question that must be asked is why did he not do his job.

This is an appalling day for this House. Our sovereignty has been yielded to others. We are stuck with a document that sets out inexplicit parameters for the budgets this House is expected to follow in the years ahead. The Government takes the position that this is not a matter for the House to approve or reject this document. How, in the name of heavens, can the Government maintain such a position? It thinks it can escape by permitting statements on the deal while claiming it does not require approval. On Monday, I set out my views why it does require a decision of this House.

I have also raised the long-term implications from the abuse of derivatives by the Irish banks. Yesterday, the Taoiseach sought to dispose of the issue by claiming Monday's interview by the Governor of the Central Bank, Professor Honohan, had cleared the matter up. It did not. Professor Honohan said the issue is now under control, which I welcome. That, however, does not tell us of the implications down the road with the legacies of covered bonds, credit-linked notes and the like.

It is a great shame the time is not provided in the House to go through the implications of this programme paragraph by paragraph. Never since we won our independence has a prospective Irish Government found itself in a position where the key decisions on social, fiscal and economic policy for the next three years are already made for it. Unless the new Government can re-negotiate this programme, it will be a prisoner of this bankrupt document and confined to a strait-jacket for the first three years of its term of office.

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