Simon Coveney (Cork South Central, Fine Gael)

This motion is a constructive contribution towards putting in place an appropriate and decisive response to our current banking crisis. Each week, the Government calls on Opposition parties to support its proposals in the national interest, to make constructive contributions and to put forward new ideas. That is exactly what this motion, through a list of specific actions, seeks to do.

Light-handed regulation and cosy relationships between senior bankers, the Financial Regulator's office, the Central Bank, the Department of Finance and, ultimately, Government has resulted in misinformation, market deception and deliberate concealment of vital information from shareholders, the markets and the public relating to the financial health of certain banks. The consequence of this failure is enormous. As the Taoiseach correctly stated this afternoon, we are now battling for the very viability of our economy. The reputation of Ireland's banking system and financial sector generally is in tatters internationally and must be rebuilt. The ability of our surviving banks to access capital is compromised and exposure to bad debt is being upgraded by the day. Also, our banking model for business is not working thus frustrating viable trading opportunities. More important, the prospect of the State being exposed to an actual call on the bank guarantee is now a real consideration at a time when it is increasingly difficult for the State to raise funds and when the deficit between revenue and expenditure is out of control.

There is no point in not talking about the gravity of the fiscal situation in an effort not to undermine already shaky confidence. The Fianna Fáil way is to tell people only what the have to know and to keep bad news from the public, as if people cannot handle the truth. It is the kind of thinking that resulted in this Government not telling this House the full facts before asking us to make enormous decisions around bank recapitalisation or the nationalisation of Anglo Irish Bank. All of the proposals in the Fine Gael motion will need to be implemented if we are to expose the truth, prosecute bankers who have broken the law, remove regulators who have failed in their responsibilities and put in place new structures upon which we can build a new tough, but fair, regulatory system.

Along with the recommendations outlined in this motion we need a new type of politics with people taking responsibility for their actions and failures rather than trying to cover their tracks in a dishonest way. This fiasco is a monumental failure of governance and a catalogue of unacceptable practices in Irish banking. This failure of Government must also result in scrutiny, exposure and reform, which is the primary job of this Opposition. The Government's explanations of who knew what and when are, to me, simply not credible. There is no point in my saying otherwise in this House if I believe it not to be so.

I wish now to focus on the back-to-back dealings between Anglo Irish Bank and Irish life & Permanent in September 2008 and the further revelations in last Sunday's edition of The Sunday Tribune. This is not the first time I have heard the suggestion that the regulator knew about Anglo's arrangements to give a false impression of its deposit base. I ask the Minister of State present in the House this evening, is it credible that the Department of Finance knew nothing of what Anglo Irish Bank was doing if the Financial Regulator was clearly aware of it? Let us not forget the Department was at that time preparing legislation to nationalise Anglo Irish Bank and would have been monitoring the bank closely and communicating almost on a daily basis with the bank and the Regulator. In that context, is it credible that the Minister for Finance and his Department were not tracking closely what was happening to Anglo's deposit base and would not have noticed €7 billion being deposited into the bank and taken out less than a week later, after the financial year end? Is it credible that in late September, before the bank guarantee scheme was announced, when the Minister for Finance took a hands on approach and was personally leaning on other Irish banks — Bank of Ireland and Allied Irish Banks — to source up to €5 billion each to make available to Anglo because it needed capital, that the Minister was not up to speed with the mechanisms Anglo Irish Bank was using to source funds and shore up its deposit base? Is it credible that when the bank guarantee scheme was in place, when the Minister commissioned and received a copy of the PricewaterhouseCoopers report, that he did not read all the detail relating to Anglo Irish Bank, the one bank his Department was so worried about it and was going to nationalise weeks earlier? The Minister for Finance is one of the leading legal brains in the country, a top senior counsel, yet we in this House are being asked to accept that he did not read the most important brief ever laid on his desk? I cannot accept this as credible.

We are also asked to believe that the Minister was not informed by his officials of an issue of this consequence. Is it credible that the Taoiseach and former Minister for Finance for four years did not receive a copy of the PwC report, conveniently absolving him from any knowledge of its contents? Our Taoiseach is entrusted with making decisions that may literally make or break our country and we are expected to believe he did not read this report commissioned by Government to examine the health of our banks. I could go on and on and try to further unravel the story that Government expects us to accept and believe in respect of this one incident between Anglo Irish Bank and Irish Life & Permanent, but I do not have time.

The political claim that Government knew nothing about the wheeling and dealing that was going on in an effort to prop up a collapsing banking model in Ireland, linked to property exposure, is about as credible as making the case that the regulator knew nothing either.

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