Arthur Morgan (Louth, Sinn Fein)

On the night the credit scheme was introduced in this House in September 2008 all parties met separately with the Department of Finance and received assurances in regard to the terms and conditions that would be enacted by way of legislation in respect of the banks.

Sinn Féin was conscious of the unique and dangerous financial climate at the time. Banks around the world were collapsing and a massive financial crisis was unfolding in Iceland. Sinn Féin listed a large number of conditions which it wanted in place if it was to support the Bill, including intense regulation of banks, criminal proceedings against corporate malpractice, a package to protect mortgage holders and an immediate suspension of all corporate bonuses. We saw the guarantee scheme as offering a real opportunity to put the banks in State hands and to provide the State with the necessary power to protect struggling businesses and mortgage holders. We were assured the conditions for the banks would be severe and effective.

The Minister misled the House on the night he introduced the Credit Institutions (Financial Support) Bill 2008. Subsequent to the publication of the Bill, Sinn Féin was forced to withdraw its support for the bank guarantee scheme because the terms and conditions fell far short of what was outlined by the Minister in advance of the guarantee. I can only assume that interaction with the banks led to a watering down of the conditions that were to be associated with the guarantee. It is evident from the behaviour of the banks in subsequent months just how seriously they took the taxpayers' great step to protect the financial institutions of the State. In hindsight, more concerns have arisen in respect of the guarantee.

There has been no indication that due consideration was given to less costly solutions to deal with the fear of the inability of one bank to roll-over wholesale funds and the prospect of this spreading to other banks. Mr. Patrick Honohan, Governor of the Central Bank and then Professor of International Financial Economics and Development at Trinity College Dublin pointed out that specific State guarantees might have been given in respect of new borrowings or injections of preference in ordinary shares as happened in other European States in the months that followed. It also quickly became apparent that the guarantee was no substitution for recapitalisation. Along with the €440 billion guarantee hanging over the heads of Irish taxpayers, subsequent decisions were made that entailed even more financial pain such as the nationalisation of Anglo Irish Bank, the recapitalisation of Allied Irish Banks and Bank of Ireland and the setting up of the National Asset Management Agency.

In approaching the guarantee legislation that night, many concerns were raised on this side of the House and many assurances given. We all believed we were acting in the best possible faith and were within days proved misguided when the Minister for Finance announced the terms and conditions of the Bill. The situation concerning the banks in this State is complicated, messy and complex. It will take months, if not years, to get our banks back on an even footing and much will be required to get there. We have yet to see a single banker brought before the courts to answer for the malpractice that took place at that time. An issue raised continually with me in my constituency office or when meeting people on the street is that while ordinary people can be imprisoned for not repaying a small loan to, say, a credit union, not a single banker, one year on, has been brought before a court in respect of the corporate malpractice and fraud that took place. I have previously referred in this House to how a constituent of mine from Dundalk was imprisoned in Mountjoy for not having a dog licence. Yet, 12 months on not one of the bankers involved in this scandal has been brought before the courts. Perhaps the Minister of State will tell the House when the investigations taking place will be concluded or at what stage they are currently. This is an issue of concern to people. What is happening, in terms of allowing bankers to walk away, is an absolute scandal. It has brought into disrepute the political classes and justice system in this State. It is time we in this House got answers in this regard.

Perhaps the Minister will clarify the following point for me. I understand that Anglo Irish Bank has closed its lending department and is letting go people who worked in that department. I understand also they technically may be able to forward funds to clients. Can the Minister of State explain what is going on in terms of this zombie bank which the Government purchased on behalf of taxpayers at a cost of approximately €28 billion. Perhaps the Minister of State will clarify how it will cost us €28 billion when it is closing its lending department? If he cannot do so, perhaps he will arrange for the Minister to come into this House to answer these questions for us.

People have seen enough in terms of Mr. Sean Fitzpatrick walking away with €83 million and Mr. Michael Fingleton and his bonus disappearing into the night, again with no recourse to any type of justice system. Ordinary people will, following next week's budget, once again have to carry the can to try to bail out these bankers to the tune of €440 billion at a time when pensioners and welfare recipients cannot even get their Christmas bonus, which will have an enormous impact on the families concerned in the dead of winter. It is hoped the Minister of State will be in a position to provide us with answers to some of the issues raised. It is time we got answers to the following questions. When will the investigations in respect of corrupt bankers be concluded? When will there be court action where proven necessary and when will these people be brought before the courts? In the US, the Enron executives were at least dealt with openly and honestly. Why is there no system here to deal similarly with bankers who behaved pathetically. I wish to point out that when referring to bankers I am not speaking about ordinary high street bankers, those working on the frontline who are often themselves impoverished workers and victims of corrupt characters at the top. I have been told by frontline bank staff that some of them are being shockingly abused by some members of the public who, mistakenly, associate them with the corruption and blackguardism going on in the background. It is worth putting this on the record.

I hope the Minister of State will be in a position to answer those questions. I look forward to hearing his reply.

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