Leo Varadkar (Dublin West, Fine Gael)

I move amendment No. 1:

In page 11, to delete lines 38 to 47 and in page 12, to delete lines 1 to 3 and substitute the following:

"(a) by the deletion of subsection (6)".

This amendment is similar to one I tabled on Committee Stage last week but which has been changed slightly to reflect the full intent. The purpose of the amendment relates to the Bill's provisions, which represent some progress. This Bill requires that loans lent on a preferential basis to directors must be disclosed both to the public and to shareholders. This will prevent a recurrence of what happened with Mr. Seán Fitzpatrick in respect of the concealment of his loans in the past. While this represents progress, Fine Gael does not believe it goes far enough. We are concerned by the fact that loans made on preferential terms to connected persons, that is, to spouses and children of directors in the main, will not be disclosed to the public and will be disclosed only to the shareholders. That is fine in respect of AIB or Bank of Ireland, because such information will be disclosed to a large number of shareholders, of whom there are hundreds of thousands in those companies, both institutional and individual. However, this is not the case with Anglo Irish Bank. Consequently, as a shareholder of both AIB and Bank of Ireland, I will be made aware of loans made on preferential terms to directors of those companies. However, I will not be made aware of loans made on preferential terms to the spouses and children of directors of Anglo Irish Bank, even though I probably am more liable for that company as a taxpayer than I am as a shareholder of the other two companies. The only person who will be in possession of such information will be the Minister for Finance. While Deputy Brian Lenihan holds that office at present, someone else could so do in future. While the only nationalised bank at present is Anglo Irish Bank, there could be others in future. I do not believe the Oireachtas should give the Minister for Finance that exclusive discretion, either now or in the future, for Anglo Irish Bank or for any other bank in the future.

I have tabled this amendment to ensure that preferential loans that are made to persons are put in the public domain. Were there a commitment from the Minister for Finance to the effect that he would be prepared to make such information available, this legislative provision would not be necessary. However, in the absence of such a commitment, it is necessary. People have lost trust in banking and politics and Members have a major job to do to restore trust in both. It is not right to give the Minister for Finance power to conceal the identity of spouses and children of directors who receive loans on preferential terms from a nationalised bank. It is important for the Houses of the Oireachtas to vindicate the right of the public to know the preferential terms on which spouses and children of directors are getting loans from a nationalised bank that is backed up with our capital and by our sovereign guarantee. The Minister of State will argue that this is a matter for the Irish Financial Services Regulatory Authority. However, while I understand that argument, I do not accept it. First, we have decided to put specific provisions into company law relating to the banks in this regard. Consequently, it is not as though the Minister himself believes there is such an absolute separation between what may be appropriately included to in the Companies Acts and what may be appropriately included in legislation pertaining to financial services. I also do not believe that power and decisions always should be ceded to ombudsmen, agencies or regulators. Perhaps this country would be in a better position, had the regulators not been given so much power to decide on their own part how regulations should be enforced in the financial services industry. There is an important role for the Houses of the Oireachtas in the restoration of confidence in politics and trust in the banking system. That means ensuring that members of the public, who are the de facto shareholders of this nationalised bank, will have the same access to information about a company they own as do the private shareholders of AIB and Bank of Ireland.

See this speech in context