Richard Bruton (Dublin North Central, Fine Gael)

There is a middle way, which is the one we have advocated. The time is so curtailed that I do not even have time to mention all the amendments we will seek to make. However, we will want to see proper operational independence in the bank and a presentation to the Oireachtas of the relationship framework so that we can vet it. We will want to see transparency on loan exposures and decisions on debt restructuring. All these transparencies are essential to public confidence. As elected representatives who are here to protect the taxpayer, we must do our job thoroughly and well.

The Government's strategy is to get lending going again, but that is not happening. The Minister knows it is not happening and so do I. Now it seems the Minister's next key strategy, the recapitalisation of AIB and Bank of Ireland, has been punctured because the market is no longer confident in it. Is the Minister considering a model that would refloat the capitalisation? In other countries, we have seen that recapitalisation has been accompanied by models of one sort or another to deal with bad debts — to ring-fence them either with an insurance policy À la the United Kingdom or a bad bank policy as has happened in other institutions. However, it gives certainty to the financial institutions as to their exposure on some of these bad debts and it allows the recapitalisation to succeed.

There is a growing sense that people are in a sweat about what is happening in the financial markets and whether the Government strategy is up to it. We need to hear from the Government very soon what the next step is and if we need to develop a model. Let us for once lead the markets instead of reacting to what is happening. Let us have a sense of the way in which we will go. Most vitally, Ireland Inc. is now in the dock. Our economic strategy is on trial and, by God, we need a proper strategy for management of the public finances and restoring competitiveness, but we have not seen it. The effort before Christmas was a disaster, as was the budget. We must get a grip because if we can steady that ship, we can steady many of the other elements that are going wrong in the financial institutions. In a way, it is showing the ill ease that exists about the way in which Ireland Inc. is being managed.

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