Seymour Crawford (Cavan-Monaghan, Fine Gael)

I thank my colleague for sharing time and welcome the opportunity to speak on this important Bill. There is an urgent need to bring some stability to the main banks and it is clear that can only be done through recapitalisation. The Minister, Deputy Brian Lenihan, stated in his contribution this will ensure that the Bank of Ireland and AIB will be in a position to provide necessary commercial credit facilities to their customers and the general economy. He also advised that the two banks are committed to increasing the lending capacity to small and medium-sized enterprises by 10% and to provide an additional 30% capital to first-time buyers. I hope that on this occasion those promises are delivered on because, as the last speaker said, they were made previously and nothing happened. In fact, things got much tighter. The Government promised this previously and it must keep its promise this time.

Fine Gael has tried to be as supportive as possible on all occasions when positive proposals were put forward by Government to save the situation or improve it as far as the banking structures are concerned, but the fact that in this proposal there is still no effort to deal with the serious bad debt situation or with the level of income earned by bank executives and the position of board members or auditors leaves much to be desired. When one hears a bank executive say that he will have to make do with a salary of less than €2 million, one must ask what it is all about. These mega figures create huge dissatisfaction among the general public, the public servants who are having levies imposed and those who are losing their jobs. I have no doubt that must be dealt with.

In the past 12 months Members of the Dáil from all parties were advised through the committee structure that all banks were in a secure and safe position, but we know now that was not true. We had a Financial Regulator who clearly did not do the job that we thought he was supposed to do and yet on his retirement he got a package of €630,000 plus a generous pension. Where were the Central Bank and the Director of Corporate Enforcement during all this period? I welcome that Anglo Irish Bank is being investigated and given the legal situation, I do not want to make any further comment. However, it is impossible to understand how all these different things went on under so-called regulation. Regulators were appointed by this House as independent regulators and were supposed to do a job as our watchdogs.

It is clear a small number of inner circle people could do what they wanted, when they wanted as has now been clearly shown by what happened in Anglo Irish Bank and between that bank and other lending institutions. The chairman of Anglo Irish Bank was able to transfer debts of great significance from his own bank to another for the end of the financial reporting year on not one year but a number of years. Questions about the entire regulatory system were never asked. Who knew what was happening and why was a blind eye turned to all these structures?

Equally one must question how ten individuals could be supported in borrowing €30 million each to buy shares in the same bank. I welcome that some effort is being made eventually to recapitalise and stabilise our two main banks but clearly this effort without some plan for the future will give little hope to those who are unemployed or in the process of losing their jobs. This is where the Government has fallen down dramatically in recent times. It is not giving any hope for structures to lead us out of this.

The fact that 26,000 more people joined the dole queue during the month of February adds at least another €500 million charge to the economy and this is the why Fine Gael is asking the Government to consider seriously ways and means of supporting employment or even, dare we say it, creating some. As the Taoiseach has stated, one person on social welfare having lost his or job costs a total of €20,000 on an annualised basis between social welfare payments and taxes lost.

It is clear that even in dire economic times it is good business to spend money on job creation, including through PRSI reductions for increased employment or low interest loans towards job creation. The Government must reconsider the use of FÁS schemes and other means of even giving part-time employment so that much-needed community structures can be improved and maintained.

One Government supporter said to me today that there is now a budget every week. I would say to the Minister it is vital that this capitalisation programme, which I am sure will be voted through in the next few days, not only works but is also backed up by a comprehensive new budget on the first week in April that not only creates stability but also provides clear direction and leadership towards better employment structures and growth for the next three years. We will not take ourselves out of this mess through charges and taxes alone without some leadership and job creation leading towards much needed exports.

I remember the early 1960s and the early 1980s, but never anything like this. There is a real need for leadership at this point in time but we are not getting it. We are getting desperation. The Taoiseach is spelling out the real difficulties, but is not coming forward with any plan. If we do not plan for the future we are heading for disaster. It is as simple as that. We on this side of the House want to see the economy starting to turn the corner. We want to see some hope.

We do not have the escape valves that we had in the 1980s when our young people were able to find jobs elsewhere. I have heard of young people who went to Australia, the United States and other places having to come back because there are no opportunities there either. I know we are in a global recession, but we are also in a recession created by ourselves to a large degree. We must take responsibility for that. The Minister must take responsibility for it.

Over the past five years Deputy Bruton has been warning that these difficulties were coming. The former Taoiseach boasted about us building 95,000 houses per year and comparing it with the UK and other countries with greater populations. That property bubble has burst. Allied Irish Bank, Bank of Ireland, Anglo Irish Bank and others gave out colossal loans that were off the wall to individuals for the purpose of buying properties in this city and throughout the country. When we hear of bankers arriving at people's houses at 9 p.m. to shove massive sums of money into their hands to buy property, we know something is wrong. We did not give the leadership to call a halt to the lunacy at that time. The ordinary people are now paying for this through income and pension levies, and now the Minister says that they will pay higher taxes from 1 April. I wish the Minister well in what he is trying to do. However, I say this to him clearly. For God's sake create a plan that will give us some hope.

See this speech in context