Noel Ahern (Dublin North West, Fianna Fail)

It is a fact because we do not have another year to start afresh. We have to work on the Bill before us. It may not be perfect but we can improve it on Committee and Report Stages with some of the suggestions made in this Chamber. We simply do not have the time to develop other proposals because we need to get the economy moving again. If there is an upturn in the world economy, we must have our banks giving credit to good ideas and ventures to move forward.

The homework on the Fine Gael proposal was not done in time. Labour spent months speaking about nationalisation, which, I accept, is a lovely, sexy fashionable slogan, but we all know that even if one nationalised, one would still need some sort of agency to move matters on thereafter. However, I was pleased to hear the leader of the Labour Party and others state in recent weeks that the party never really had in mind that there would be 100% nationalisation and that just increasing the equity share was what it had in mind. If that was made clear months ago, we might have made progress and we might have had a greater understanding of where we were and gone some way towards reaching a consensus on some of the issues.

Sometimes when there are significant problems it is no harm to reflect on the good days and the good that has been achieved. The economy enjoyed a good spell over the past ten, 12 or 14 years. There has been fantastic growth and improvements beyond what many of us would have thought of in our wildest dreams. I always was impressed by the number of people working in the economy, where 15 years ago or so there were 1.8 million employed and then we reached employment of more than 2 million. In recent years I was amazed, surprised and delighted on several occasions to see people who had not got a job for 10 or 20 years becoming employed. In parts of my constituency which would not be regarded as well-off areas, entire households, not just individuals or fathers, had not got jobs for years, if ever, and the progress made in the economy in recent years made all the difference. I accept that 200,000 of those jobs have now been lost — hopefully, temporarily — but there are still approximately 1.8 million people working which is much better than was the case when there were 1.1 million employed.

We can look back as a society and state that we lost the run of ourselves. I suppose everyone would say that another group lost the run of themselves. Government was not the worst offender over those ten or 14 years. When the coffers were full Government did extraordinary work — reducing the national debt, with the pension reserve fund and the various infrastructural projects. We all enjoyed tax reductions and there were significant improvements in services in health, education, special needs and so on.

This is not just a Government matter. Much of the anger and hurt is because people borrowed vast sums for productive, and perhaps not so productive, purposes. This recession is different from ones in the 1980s and at other times because of the level of personal debt. Much of people's annoyance and hurt is because of the money people borrowed to buy property here and abroad.

The economy is like a pendulum. Some of the gains made in recent years were not sustainable when the pendulum swung in the other direction. Many still feel that we could have had a soft landing, that we could have come down off our own ten-year high were it not for the world recession which came along and hit us for six. We all are wiser after the event but, as Deputy Michael D. Higgins stated, the main blame for everything lies with the banks which were basically shovelling out credit.

For five years I was Minister of State at the Department of the Environment, Heritage and Local Government with responsibility for housing and I recall that for the first two or three of those my mantra at Question Time or when out and about was "Supply, supply, supply". At the time I felt, as we all did, that only by increasing supply could one help to bring down and control prices. Because people were no longer emigrating and because they had jobs, they needed accommodation and like anything in short supply, houses were too dear. Then approximately half way through my five years in the Department I began to realise that something was wrong, that despite the supply house prices were still increasing. Basically, it was because there was too much credit. While I did not favour developers for the first couple of years, I really began to feel that the builders were not really at fault. If there were people coming to look, not even at show houses but at a building site and a plan, to be told where their house or apartment would be located in a field, and if they were trying to knock the builder over with bits of paper showing what loans they had got from the banks, it was difficult for the builder not to increase his price.

At that time I remember strongly objecting to 100% mortgages, not so much in principle but for the way they were being sold or advertised. If one gave a 100% mortgage to a person or a couple who were well set in careers, that was all right, but at that time some of the financial institutions were giving out leaflets on Grafton Street at lunchtime, as one would give out leaflets promoting an early pint, buying a pizza or something frivolous. Handing out leaflets encouraging impulsive buying and asking people to take out a mortgage with no deposit was shameful. It was naked greed. At the time as a mere Minister of State I made several references in speeches to the media about it and the general reaction was a mixture of being ignored and being rubbished. I was surprised that many of the media were horrified at me sort of saying nasty things about the financial institutions and I remember being amazed at the way many in the media protected the financial institutions. At that time I remember in the Department we had meetings with many organisations such as the Central Bank and the Department of Finance. We suggested that the amount that financial institutions put on deposit in the Central Bank in relation to their mortgages be increased by the slightest amount merely to give a message that we needed to put a gentle foot on the brake, but that was rejected. They were not interested in hunches. They always wanted quantified, verified researched data so that one had to prove everything to them ten times over before they would-----

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