Cyprian Brady (Dublin Central, Fianna Fail)

I too welcome the opportunity to contribute to this debate. Nobody on this side of the House denies that we are facing into a difficult period for this economy. Our GNP has been steadily decreasing and our economic growth is declining. However, the entire developed world is also facing a period of economic turbulence. Rising fuel and food prices and the fallout from the ever-worrying credit crunch are having a negative impact on growth throughout the world. However, as the Minister pointed out, we are in a much better position to weather the storm now than we were in the 1980s. Irish exports remain strong. Exports of business services and software grew by an incredible 25% in 2007 and now earn as much as pharmaceutical exports. The inflow of foreign direct investment remains strong and FDI will be the key to driving the Irish economy towards recovery in 2009. IDA Ireland continues to win projects and create employment here. In my constituency, for example, the success of the Irish Financial Services Centre has been remarkable and it continues to create employment and attract new business, with major financial institutions continuing to establish a presence in the IFSC.

The Government has successfully managed the boom and is well equipped to ensure we manage our way through the tough times that are before us. The fact that the budget is being brought forward to 14 October illustrates the commitment of the Government. I also welcome the Minister's efforts with regard to guarantees on bank deposits. This is an issue that affects many people. People were confused about their entitlements and the fact that the issue was clarified in such a speedy way is to be welcomed.

I must express my concern at the lending practices and lack of prudence of some banks. There have been cases in which 100% mortgages have been given to individuals who cannot afford the repayments. A number of these were given on an interest-free basis for five years. After those five years the borrowers must repay the full principal and interest, and many are facing negative equity. In a number of cases, the borrower cannot afford the full amount that will be charged. Representatives of the banks attended a meeting of the Joint Committee on Finance and the Public Service a few weeks ago and reassurances were given. For example, there was a reassurance that Bank of Ireland would retain its dividend. However, this has now been slashed by 50% due to more challenging trading conditions. While Irish banks do not seem to be exposed to the sub-prime mortgage crisis, they are being hit far more badly than most banks in Europe. This is worrying.

We can overcome this current period of slowing growth. We are still attracting foreign direct investment and we must continue to do so. Our construction industry has contracted, but we are creating employment in other areas such as financial services, pharmaceuticals, IT and the service sector as a whole. I express my concern, however, at some of the practices of a number of our banks and I would like to see more transparency in this area.

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