Pat Rabbitte (Dublin South West, Labour)

I will turn the clock back a little and put some specific questions to the Minister. Has the Minister been assured and has he negotiated clearance that down the road there will not be a state aid repercussion as a result of this decision? This is state aid, there is no doubt about it. The Minister claims it is a state aid, saying if there was not an uplift there would be no merit in the exercise because the banks would have to come back for proportionately the same in recapitalisation.

My memory of the last night was that the Minister did not reply to Deputy Bruton's point where he dealt with the question of the total value of the loan book in respect of land, which was €28 billion. The mark down on that was more than the standard 47% and Deputy Bruton posited that it would be 50%, €14 billion. Therefore, €7 billion is 50% of €14 billion and I thought the Minister said there was a ceiling on what the uplift could be on land of approximately 25%. I would appreciate if the Minister would address that when replying because I did not get the response on that either.

Deputy Burton made the point that when the Minister produces in support of his position reputable international agencies such as the ECB, he never adverts to the fact that whether it is the ECB or any of the others, including EUROSTAT, they draw attention to the fact that this support comes with a heavy warning about paying more for the assets than market value. Each of them has underlined that and even EUROSTAT said it is not in a position to judge if the condition is plausible. It states that the current market value is 15% lower than the LTEV but the Irish authorities believe that under current conditions, the market value for properties is artificially low.

We are going to have to live with this for the rest of our political lives. The Minister is not for turning, and is prepared to pay a hope value to avoid the acquisition of more shares and a higher degree of public ownership or nationalisation. I would say to Deputy Gogarty, however, that the Minister for Finance has been far more cautious than he has in pouring cold water on nationalisation because the Minister knows that at the end of the day that may be where end up, albeit by the scenic route and at greater expense than if we had made a temporary decision, had done the clean up and prepared the banks for reflotation as soon as possible.

We should not deal in apocalyptic terms because there are a number of approaches to the issue. The Minister has embarked on one, and my view is that his approach is conditioned by a number of factors but it stems from the fateful decision of the all-encompassing guarantee on the night of 29 September. No doubt it is fair for him to draw attention to the disposition of the Commission in the sense that there is a view that it would be preferable to avoid nationalisation. I accept that is the view but, as Deputy Burton pointed out, even in the document the Minister quoted, there are reasons to stop and take stock when looking at the European template for where we are now.

The long and the short of it is that Deputy Fahey's assertion that we are in this hole because people were paying market value rather than the long-term economic value, but whatever else is the cause of the hole we are in, that is not the cause of it. The Minister is placing a hell of a burden on the shoulders of the taxpayer because of the route he has taken so I would appreciate if he would answer those questions.

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