Arthur Morgan (Louth, Sinn Fein)

My party understands that the Government needs to intervene to stabilise the financial system. The logic behind this move is to undermine the bear market and lead to investment in our banking system. This legislation is about more than the banks and I accept the point made in this regard by several speakers. It is about offering security to ordinary citizens, investors and Irish businesses, which in turn means jobs. It may well prove to be a move that other states will seek to emulate.

The concern all day is based on what will be the quid pro quo. What will the Government extract from the banks in return for this legislation? The Bill does not offer the details needed to inform us of the terms and conditions the taxpayer will require. We need to be particularly cautious about this move because, since the Central Bank has proven itself to be spectacularly incapable of doing its job, we do not know what our major banks' budget sheets look like and what liabilities Irish taxpayers are undertaking. We need the guarantee to be underpinned by more conditions and we need detail thereon.

When the Government bailed out AIB in the 1980s after the ICI collapse, a levy was introduced on the banks. A similar initiative must be included in this Bill to build a fund that will serve to meet the insurance requirement that is clearly necessary for the banking sector. If this guarantee does what it should, the banks should make a profit from borrowing the State's name and should pay significant compensation to the State for that security. There should also be a commitment from bank management to forgo bonuses for the time covered by this guarantee, or consider cuts in their exorbitant salaries. Separately, we need to see new transparency in the banking system and we need better regulation.

Today, while welcoming this decisive move, we must point out that action could have been taken many years ago to prevent the move from being necessary. As far back as 2005, the Oireachtas Committee on Finance and the Public Service, of which my colleague Deputy Ó Caoláin was a member, made recommendations on bank charges and interest rates. Deputy Ó Caoláin initiated the process. As well as exposing the lack of transparency on the part of banks regarding their charges for customers, the committee urged the need for further regulation of banks. We must not forget the current global financial crisis is of the sector's own making.

We need to know what assurance will be given to ordinary people, including those who have lost their jobs in the construction sector, those who are mortgaged to the hilt and are facing negative equity in their homes, those who risk losing their homes and those who did not earn bonuses during the boom years while others reaped millions. This guarantee will mean nothing to people, hauled before the courts by the banks, currently embroiled in court hearings over mortgage defaults.

When was the last time the Government sat through the night to come up with solutions to solve these people's problems, as it did last night? It is imperative that the Government offers the same level of security offered to the banks to ordinary people in debt to the banks. Thus far, no bank has moved on a major developer to recoup loans, yet homes continue to be repossessed. Along with the guarantee I seek, there should be an immediate moratorium on home repossessions. Every step must be taken to ensure people can reschedule loans where required, defer payments on the capital sum borrowed and, as required, negotiate interest-only repayments for a designated period.

My party has always been in favour of a State bank. This morning's announcement is evidence enough of the value of such a proposition. With a State bank, the Government can adequately protect the investments and deposits of ordinary citizens and small businesses while wisely investing profits into the public purse to the advantage of all. The newfound policy of privatising profit while socialising debt surely magnifies the need for an urgent reorientation of our economy. The sooner such a process commences, the sooner funding will be found for the provision for proper social services.

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