Joan Burton (Dublin West, Labour)

I also raised Deputy Richard Bruton's points on section 1 earlier. It is important for the Minister to remember he is taking powers not just to give guarantees but to allow himself take equity, loans, debentures, near-equities or other types of interests in banking companies. The Minister must respond to these issues.

I wish to speak about amendment No. 2 in the name of the Labour Party, which proposes that any financial institution that applies for the guarantees under this Act shall "agree not to offer to any of its officers or employees any share options during the currency of financial support and to limit the gross annual earnings of any of its officers or employees to not more than the gross earnings of the Minister for Finance during that period".

I am sure the Minister remembers Tom Wolfe's novel about financial greed and the Gordon Gekko motto that greed is good. The masters of the universe have become accustomed to earning extraordinarily large salaries. We know that the managing director of Irish Life and Permanent earns an annual salary of €1.4 million. In AIB, the figure is €2.1 million; Anglo Irish Bank, €3.3 million; Bank of Ireland, €3 million; and Irish Nationwide, €2.3 million per year. As the Irish taxpayer steps up to the plate to guarantee the borrowings of the Irish banks and, by extension, to underwrite the capacity of the banks to lend, why is the Minister not prepared to say to the Irish taxpayer that he will cap the remuneration packages enjoyed by these people? Many people regard that kind of remuneration, referred to as compensation by the recipients, to be obscene and, in the context of where the banks are now, completely unjustified and simply not appropriate any more.

The bonus culture, with wild deregulation, is what has led the international financial system, including the Irish financial system, unfortunately, to the position in which it now finds itself. When Lehman Brothers went to the wall the average bonus for thousands of its employees was $245,000 per year. Why will the Minister not accept the Labour Party amendment?

If a bank was a delinquent teenager engaged in anti-social behaviour it would be given an ASBO. What about undermining the finances of a country? How anti-social is that kind of behaviour? Would such a teenager get an ASBO?

If a teenager was delinquent in terms of not attending school, he or she would be asked by a juvenile liaison officer or a teacher to enter into a contract to be of good behaviour. We are asking the Minister, as the head teacher vis-À-vis the banks, to say to the directors of the banks that he is not grounding them but putting a cap on their earnings because he wants to stop the kind of reckless behaviour that some banks indulged in. That behaviour was based on the premise that the more risks they took, the more rewards they get. If bankers sold financial products of dubious merit or bundled them and sold them on, the consequence was that their bonuses increased. Nobody examined whether those products had any end value. In the United States, such complex financial products have proven, in many cases, to be worthless. Why does that matter? It matters in the sense that ordinary people all over the world have their money in banks and depend on the security of such banks for the security of their savings, their employers depend on the credit facilities of banks to pay their employees and, as we all know, young people in Ireland depend on credit from banks to get a family home.

If the bonus culture is allowed to continue as it has operated to date and if the people to whom I refer are allowed to continue to receive extraordinarily large salaries or compensation, where is the incentive for them to change their behaviour? The Minister indicated earlier that he felt that the Labour Party proposal might be difficult to implement. In the context of the Irish taxpayer giving a €400 billion guarantee, which could increase to €460 billion, why are we afraid to ask these guys to make a sacrifice, to bring themselves down to the level of the mere Minister for Finance of the country? I do not know exactly what the Minister's salary or compensation is, but I believe he earns in the region of €250,000 to €300,000 gross per annum.

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