Dara Calleary (Mayo, Fianna Fail) | Oireachtas source

I thank the officials for attending and for providing all of that detail. This is a sham, quite frankly. It will not do anything. While Mr. Houlihan mentioned an effective system of current oversight authorities and their long tradition, it is that effective system and long tradition that have us where we are today. We were depending on the auditors' systems as a system of robust audit on bank accounts. Shareholders around this country who have been cleaned out in regard to bank shares and other shares were dependent on those same auditors when they put their life savings into bank shares. It is too late for them, unfortunately, and many people are in very serious situations because they were let down by what they thought were independent and effective auditors. That was their expectation gap and they are now paying for that gap.

What we want now is something robust, new and challenging that changes the goalposts completely in favour of some system of independent financial guarantee on the state of any company. Unfortunately, the jist of what I am getting from the witnesses' negotiations is that it will be all right on the night. However, there is a big row about the legal basis of the proposal for a regulation and there are people having a row as to whether we should have a regulation or a directive.

One of the most striking comments Mr. Houlihan made was in clarifying he was not comparing audit companies to car salesmen or to takeaways. I know Mr. Houlihan is trying to do a job here but this directive will do nothing to restore public confidence in the audit system. The lack of urgency with which the negotiations are proceeding at EU level is not good enough. It is reflective of a leadránach kind of response to a situation that has caused devastation for companies and for hundreds of thousands and probably millions of people across the EU.

This will not be completed during the Cypriot Presidency and Mr. Houlihan said Ireland will play a major part in bringing it aboard. Has he specific aims to bring this aboard before the end of our Presidency next June or will it pass on to the next Presidency and then pass on to the Presidency after that? What sanctions are being discussed? There are many fine academic proposals here but what sanctions are being discussed for the breaching of any of these regulations? There was an issue at Council working party level about the mandatory rotation of audit firms. Is that being queried or contested by some companies?

No offence to Mr. Houlihan, who is working with all he has. However, frankly, these regulations will not stop us from coming back in 20 years to another crisis of confidence in the system. I referred to the expectation gap. Everybody was assured that these big name companies - I will not bother mentioning their names - were giving guarantees about the financial stability not just of our banks but of big PLCs, but they did not deliver. Mr. Houlihan spoke about the audit chain in companies and banks being difficult to judge. That is exactly it. We depended on auditors in PLCs to report properly on impaired loans but the whole chain collapsed. What this directive needs to do is ensure that chain is robust enough and strengthened enough for it not to happen again. I am afraid nothing in what Mr. Houlihan has outlined would give me any confidence we are actually going to fix our audit system.