Olivia Mitchell (Dublin South, Fine Gael)

It is absolutely impossible to overstate the rage and anger among the people about the failure of those in whom they place their trust to protect their interests. This includes the Government, bankers, enforcers and regulators. This issue is too important for political point scoring but somebody must speak on behalf of those who have lost their pensions, savings and jobs and who are fearful for their future.

The issue we are discussing relates to confidence in our political leadership and its ability to manage and restore confidence in our banking sector. Confidence is key. It does not matter a jot how viable is a bank or how accurately its balance sheet reflects its asset price if the market does not believe it to be true. I am sorry that the markets do not believe what the Minister for Finance is telling them. He says the banks are sound but the markets do not believe him no matter how many times he says it. However, the markets perceive Ireland to have a basket case economy and an inept Government, incapable of making decisions to deal with the banking crisis. I am not the only person saying this. The same story is published in every international newspaper. No matter how true it is what they say about our Government, banks and regulators, it is heartbreaking. The markets are reflecting this and investors are shying away from Irish banks again today.

We have had four months of this and it cannot go on. The handling of the Anglo Irish Bank issue is an example of how not to inspire confidence. From day one, it was clear the bank was not a viable business, yet when decisive action should have been taken, the Minister's solution was too timid and tentative. The suggestion that it would merge with other banks was never realistic, particularly when it was not made a condition of the guarantee scheme. The next suggestion was to partially recapitalise it, which was followed by a proposal for part ownership but now, four months on, the taxpayer has had to buy a bank whose primary asset nobody wants.

The issue is whether the Government can learn lessons from the Anglo Irish Bank scenario when dealing with the other banks. Surely, it must be obvious that by merely throwing money at a bank, the problem will not be solved, confidence will not be restored in the system and the agony will be prolonged. The problem is it is perceived that the bad debts in our formerly blue chip banks are enormous. I do not know whether this is the case and I do not know whether the Minister does but as long as the markets believe that, they might as well be.

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