Oireachtas Joint and Select Committees

Wednesday, 3 November 2021

Joint Oireachtas Committee on Finance, Public Expenditure and Reform, and Taoiseach

General Scheme of the Central Bank (Individual Accountability Framework) Bill 2021: Central Bank

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein)
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I welcome the witnesses. I also welcome that we are dealing with the heads of this proposed Bill. It was mentioned the Central Bank's behaviour and culture report into Irish retail banks which called for this type of legislation was published in July 2018. We are now coming to the end of 2021 and we still do not have the legislation, only heads of the proposed Bill. What is disappointing for me is that the eventual legislation will not be implemented until January 2023, which is more than four years after the Central Bank's report. Given what this country has been through, it is unacceptable that, in the context of holding senior individuals within the financial sector accountable, four years on from the Central Bank's report, the necessary powers are still not in place. That said, we are where we are.

As already stated, I welcome the general scheme, which we need to deal with in quite some detail. We have, like the Central Bank, called for an individual accountability framework for bankers and those within financial institutions. Head 4 provides for the role and responsibilities of regulated institutions to map out the key management governance in reporting respect of arrangements, including the reporting lines of senior executive functions, SEFs. If a senior employee who comes under the scope of an SEF takes all reasonable steps to avoid the firm committing or continuing to commit a prescribed contravention and reports that action further up the chain of command and the contravention continues and he or she reports that further up the chain of command, would the framework hold those further up the reporting line responsible, such as the CEO?

We know that many former senior bankers during the financial crash waltzed off into the sunset with their savings and were not held accountable. What is proposed in the general scheme would bring former employees under the scope of the proposed legislation. Head 5 includes the criteria that must be satisfied for a person to have committed a prescribed contravention. Would the general scheme allow for a former employee, who is no longer working in the financial services sector to be investigated and sanctioned under this legislation, because, according to the heads of Bill, this action can be taken to ensure no further damage would be done in the financial services. I am talking about former senior bankers. We all know their names, which are common knowledge. They left the country and the banks bust. They behaved recklessly, but are no longer working in financial services. They have retired. Do they still fall within the scope of the proposed legislation?