Richard Bruton (Dublin North Central, Fine Gael)

We will stand at the ready to protect and save what is systemically important in the banking system so that if the banks cannot meet stress tests and must come to the State for aid, it will clearly be on the basis of saving what is important - the parts that will keep our economy, our businesses and our families going - but leaving certain investors to deal with the toxic loans and the bad decisions they made. That is an important distinction.

This approach to bank resolution has many positive aspects that do not feature in NAMA. The risks and the responsibility for working out problems will remain with those investors who created them and the losses that occur will be first borne by those professional investors who made them. That is an important principle and goes to the core of many people's concerns about NAMA. It also establishes a way of accessing money from the ECB and from markets, not to support impaired loans and nurse them along but to get money to businesses that need it. This is also important. It avoids creating a State-run property monopoly with all its attendant dangers, which have been analysed elsewhere, and exposure for the taxpayer. If there is one thing we have learned in 20 years of politics it is that if we mix political power with property ambitions it is an explosive combination and contrary to the public interest. The idea of a State-controlled monopoly, operating in a secretive way, is going back down a road we should have learned, at our cost, not to embark upon.

Our proposal also offers a coherent framework not only for this banking crisis but for the behaviour of banks in the long term. We, the Oireachtas, and the Irish public see a distinction between what is systemically important within the banks and deserves our support and protection, and what is not. We will know the sort of lending practices and activities that we will not be supporting, and banks will know about this approach now and for the future. This is an important principle that we ought to enshrine in our approach to this.

Most importantly, the proposal does not use scarce public money to nurse along the impaired loans but to help with export-led recovery. It avoids the debate about the need to value these impaired loans, where there are major risks even if we are using market values, as many have pointed out. It also avoids us crystallising all these losses up-front, which we do not seek to do. I heard the Taoiseach say this process is all about crystallising losses. It is all very well to talk about crystallising the losses, which were created by investors in the bank, but the impact for the Irish taxpayer of the crystals the Taoiseach talked about creating will be felt like shafts of glass in terms of what he or she will have to pay. That is the crystallising process the Taoiseach is creating.

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