Seanad debates

Wednesday, 13 May 2009

Corporate Governance: Motion

 

5:00 pm

Photo of Marc MacSharryMarc MacSharry (Fianna Fail)

I move amendment No. 1:

To delete all words after "Seanad Éireann"' and substitute the following:

"commends the Government for:

— its management of the economy and public finances, which means that Ireland faces the current global economic crisis from a position of comparative strength, given the strong growth of recent years and relatively low levels of public debt;

— the policies it is pursuing to restore credibility and sustainability to the public finances. These will help Ireland to take full advantage of the global upswing when it emerges, thus ensuring that the economy returns to its potential growth rate;

— its recent Supplementary Budget which introduces further measures to consolidate the ongoing restoration of stability to the public finances which will underpin employment creation and lay the foundation for a return to prosperity;

— the recent initiatives undertaken by the Government to preserve the financial stability of the banking system and to address the issue of asset quality in the banking system through strengthening the banks' balance sheets in order to achieve a sustained flow of credit to the economy;

notes that:

— the external factors impacting upon the economy and the recent publication of economic forecasts by the European Commission and the IMF which have downgraded the growth outlook for the global economy in addition to that of the euro zone;

— whilst the labour market has deteriorated significantly recently, approximately 2 million people are still employed, which is 600,000 more than a decade ago;

— the Government through its ongoing management will continue to address the economic, fiscal and banking sector issues facing the country over the coming years in a responsible and sustainable manner;

— the 2001 code of practice for the governance of state bodies sets out the principles of corporate governance which state bodies are required to adopt and the Government's approval of a revised code of practice;

recognises:

— the recently published Finance Bill will help ensure a progressive implementation of the adjustment needed in this economy and provide for a proportionate sharing of the burden of this adjustment;

— the commitment in the Programme for Government to regulate political lobbying;

— the many initiatives taken in Government departments extending whistleblowing protection;

— the substantial body of Company Law providing for good corporate governance under the Companies Acts 1963-2006 and the work of the Office of the Director of Corporate Enforcement;

— the work of the Company Law Review Group in producing proposals for the major reform and consolidation of the 13 Companies Acts resulting early next year in the publication of a very significant piece of legislation of some 1,250 sections;

— the publication in the meantime of the Companies (Amendment) Bill 2009 currently before the Oireachtas, providing among other things:

• enhanced powers for the Director of Corporate Enforcement in his efforts to ensure compliance with the Company Law code and,

• improving the transparency of loans made by companies that are licensed banks to their directors and to persons connected with them;

— notes the continued operation of the FOI legislation."

I join with other speakers in welcoming the Minister. I welcome the opportunity of making some points on the motion before the House, which I will not support. I will support the Government amendment.

I wish to state on my behalf and on behalf of my colleagues on the Government side that we do not condone any political wrongdoing or bribe taking, which has been perpetrated in the past. We would not condone any such behaviour. Recent Administrations have presided over the introduction of more legislation in this area than any previous Administration and have done more to try to root out the instances that have occurred in the past.

As Members will be aware, lobbying plays a significant role in our democracy. We all come into contact every day with some form of lobbying from individuals and organisations. I am aware that representatives of the Irish Cancer Society are in the House today making representations on how they would like their views practised. Groups from a variety of interests, whether it be economic, professional or, as with the Irish Cancer Society, civil society, engage in lobbying. Lobbying is conducted through varying forms of communication to influence our political decisions, Government and legislation that is brought forward.

Ireland may be unique in that individuals and groups can easily access their local representatives be they TDs, councillors or Senators, and that is to be welcomed. In the United Kingdom the process is much more distant. Before I was elected to this House I appreciated that people enjoyed unprecedented access to their public representatives. That is not a process from which we should move away.

In recent years the Government has introduced several pieces of legislation and codes of conduct on the work we, as elected representatives, carry out and how that work should be done. In the past ten to 15 years this and previous Governments have introduced more legislation in that regard than at any other time in the history of the State. We have had the Local Elections (Disclosure of Donations and Expenditure) Act, amended in 2001 to include expenditure and donations disclosure regimes at local elections and annual donation disclosure for all councillors. We had the Electoral Act 1997, amended in 2004, on the expenditure and donations disclosure regime at Dáil, European, presidential and Seanad elections, although limits must be introduced in the context of Seanad elections. We have had the Standards in Public Office Act 2001, which established the Standards in Public Office Commission. We have had the Prevention of Corruption (Amendment) Act 2001 to provide for a presumption of corruption in certain cases. We have had the Local Government Act 2001 which modernised local government law which provided for an updated ethics infrastructure, a requirement for annual declaration and disclosure of interest for the local government. The Proceeds of Crime (Amendment) Act 2005 gives additional powers to bolster the operation of the Criminal Assets Bureau in the fight against all forms of crime, including white collar crime and corruption. We also had the Ethics in Public Office (Amendment) Act 2007.

Various codes of conduct have been established for parliamentary Members and county councillors. We have had a number of tribunals and while much good work has been done by the tribunals, it is time they began to wrap up their work. We have seen some political wrongdoing in the past but as a public representative I would much prefer to see the gardaí investigate such matters to ensure that when wrongdoing is found, people receive the full rigours of the law in terms of punishment if they are found to be in receipt of bribes or abusing their positions.

In addition to this legislation by the Department of the Environment, Heritage and Local Government, the Minister commissioned reports in 2001 by the Institute of Public Administration and again in 2006 by Dr. Raj Chari of Trinity College and Dr. Murphy of DCU on assessing the best international practices in the regulation of lobbying. Many of these proposals are currently being reviewed by the Department with a view to bringing forward legislation to regulate lobbying. I look forward to that. The Minister, Deputy John Gormley, is actively considering it.

I thank the Labour Party for tabling this motion. There is always a way to make good existing legislation better and there will always be a need for the Houses of the Oireachtas to monitor and adjust legislation continually according to the ever-changing needs of our economy and civil society.

A study is currently being carried out by Trinity College, Dublin. It has reviewed the Labour Party's corporate governance Bill on the regulation of lobbyists. It found that if implemented as it stands, Ireland would be lowly to medium regulated. According to the review, we would be above Poland but below Lithuania and Hungary. While there might be good aspects to the Labour Party's proposals, we should aspire to introduce improvements that would allow the country to score a little better than that. One of the main proposals in the Bill is a cooling-off period but only for political advisers, not politicians. The report is of the view that this weakens the Bill considerably.

With regard to developing a system for whistleblowers' protection, in March 2009 a Government sponsored report by Transparency International, entitled National Integrity Systems - Country Study, was produced following a study carried out over two and a half years. One of the primary recommendations of this report was that protection for whistleblowers should be introduced through anti-corruption safeguards across the public and private sectors. The Government in recent years has been implementing protection for whistleblowers on a sectoral basis. There is still no formal word from the Department of Justice, Equality and Law Reform on implementing an overall national safeguard framework but work is continuing in that regard. The report found that Ireland, by international standards, has the lowest level of petty corruption, which is encouraging. That is not to suggest we do not have continuing challenges to meet and continuing changes to make.

There have been changes to the Freedom of Information Act. Before I became a Member of the House I was a regular user of that Act when I worked in the chambers of commerce movement. I used it to facilitate the movement's work. There were frustrations about information that was not available and I certainly felt them as chief executive officer of Sligo Chamber of Commerce on certain issues. However, one can appreciate the need for confidentiality at certain times and the need for Cabinet confidentiality. At the same time, I understand the frustrations. It is something we should monitor. I was interested in the views expressed by the Information Commissioner, Ms Emily O'Reilly. The Department should continue to monitor the issue and be flexible in making changes as may be appropriate when issues are raised in debates such as this and by our Labour Party and Fine Gael colleagues and Members of the Houses generally. The introduction of fees was a necessary evil. When one considers the current economic situation, it is certainly appropriate, as it was with the fees applying to objections to planning permissions. For a credible objection or a credible application under the Freedom of Information Act, it is appropriate that there should be a fee.

I welcome the opportunity to discuss these issues. The Labour Party tabled the motion in good faith but I support the Government amendment. I am sure the Minister and the Government are willing to listen to innovative and constructive suggestions that could make improvements to what I believe is already good legislative change over recent years in the areas of corporate governance, freedom of information and lobbying.

Comments

Eoin Ryan
Posted on 15 May 2009 12:44 am (Report this comment)

Whilst the promised legislation does appear to be in the right direction, it is long overdue, better and more comprehensive legislation has been proposed by the opposition and the real test is the amount of prosecutions relative to observed injustices.

You must agree that the standard of corporate governance, particularly in the financial sector, barely deserves the moniker of 'governance'. Consider things like the bank guarantee, which may make us taxpayers liable for reckless ways while the people that profited may now get away with it.

And the pensioners have only eggs to throw and no pensions.

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