Pat Rabbitte (Dublin South West, Labour)

The word "historic" is overused but it is quite clear that what we are doing is historic, as is what is happening on Capitol Hill. Some things will never be the same again. What Deputy Burton's amendment and that of Deputy Bruton reflect is the concern across the world over the situation in which excessive greed on the part of the leadership of some financial institutions has landed the global financial system. A survey of chief executive officers of financial institutions in the United States showed that a typical chief executive officer earns in one day what an average worker earns in a year. This must not continue. Chief executives of some banks that went down in the United States were earning a salary of $250,000 and walking away with a per annum bonus of $23 million. This is the kind of dynamic that has driven the greed that has landed us in our current position. Regardless of how the amendments are framed, they reflect widespread concern over an issue that must be brought under control.

I support Deputy Bruton's amendment. The additional point contained therein is critical in respect of the sick loans on some of the books of our own banks. If the Minister does not insist that they be teased out with the regulatory authority, we will be back where we started.

Let me refer to two of the definitions in the legislation, one of which was dealt with by Deputy Bruton, namely, that of "financial support". The meat of this Bill is in section 6. It is the section that will make financial support possible, if deemed necessary. When the Minister launched this debate, the Taoiseach spoke to the House and referred to shareholders bearing the brunt. He implied the ECB was the next port of call, followed by the sector. He stated nothing would redound to the taxpayer as the sector would pick it up. I have never been quite able to get my head around that.

The definition of "financial support" no longer relates only to the question of the guarantee. We were told we were the guarantor of last resort but it now appears financial support can mean a loan, equity or something else. I am not necessarily concluding that the Minister should not have scope in this area, but he has not been very forthcoming with us about what he knows. I suspect we will learn a lot more about this matter immediately around the corner. If the Minister is contemplating changing the architecture of the Irish banking system, or if he knows there is a merger in the offing and needs the desired flexibility, he should tell us about it.

On the definition of "credit institution", I am not opposing the Minister's adding to list of six institutions. However, I would like to know whether any work has been done in the Department on the criteria because money is flowing into our banks from Britain and even New York. It is a very serious matter to be disadvantaged not just in terms of that incoming money, but also in terms of money on deposit flowing out to one of the protected banks. This constitutes a real issue. It seems the Minister has not worked this out yet, which is fair enough, but we need some kind of indication as to the criteria that will be brought to bear in the circumstances I have outlined. There is a serious issue of competitive disadvantage at play and the Minister should give us some idea of his thinking.

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