Denis Naughten (Roscommon-South Leitrim, Fine Gael)

I will be brief. The last speaker discussed allowing several days to go through this Bill, but I will not delay the House to any great extent. Last night during his Second Stage contribution, Deputy Richard Bruton explained with what we are dealing very succinctly for the public. He said:

We must all understand that a sound financial system is like the oil running through an engine. If that oil is drained away by a loss of confidence, then suddenly that engine seizes.

We must ensure that does not happen in this country. Without a sound financial system everything would seize up, not only the banks in this country but the day-to-day lives of ordinary individuals. The principal concern I have regarding the terms and conditions is for provision to be made to ensure the taxpayer is protected. In his contribution last night, Deputy Bruton made the point that we do not wish to see a situation where the banks are going to gamble their money on the basis they have an AAA rating supported by the Government. That situation cannot and should not arise and I do not wish to see such an eventuality.

At present, viable proposals put forward by individuals or small businesses in this country are being shot down. The banks have the additional protection to ensure flexibility can be provided. I know of one small company in the past few days which had to go to six financial institutions to get a loan of €200,000 from each institution. It succeeded in getting approval in five of those six financial institutions, even though the company provided a fully audited business plan. However, because the sixth institution turned the request down, the company went to the wall. At present, banks are being far too conservative in issuing loans. One bank manager put it to me yesterday that the only applicants being approved for loans are those that do not require them.

It is critically important that we see the terms and conditions stitched into this legislation and the flesh on it. The terms and conditions stitched into the agreements with the banks must ensure there is liquidity and credit available to those that have a well-founded business plan. We must not facilitate the banks in this country so they may gamble on the derivatives trading market. Irish taxpayers are putting their necks on the line to protect the banking sector in this country and there needs to be a benefit from that, not only in terms of equity but also in terms of getting the economy running again.

The proposals of Deputy Bruton and Fine Gael dealing with appointing personnel to the risk management committees of each of those banks is a fundamental request that must be facilitated. They also deal with the issue of excessive bonuses, top-ups, dividends and payments made. Such outcomes cannot be allowed to happen with the protections we are now providing to the banks.

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