Dara Calleary (Mayo, Fianna Fail)

I wish to pay tribute to Members of the Oireachtas from across the Border region who have reflected the views of the workers of the Quinn Group on a non-political and non-partisan basis in recent weeks. However, companies in the insurance sector operate within a regulated market place in order to safeguard the long-term interests of policyholders and third parties. As Members are aware, the Financial Regulator is working on a number of issues at present in respect of the Quinn Group and the Government awaits the outcome. I appreciate the concerns of those employed directly or indirectly by Quinn Insurance Limited but the Regulator has acted in what it considers to be the best interests of the firm's policyholders and the appointment of the administrators will allow the firm to remain open for business, to continue to be run as a going concern with a view to placing it on an ongoing sound commercial and financial footing. I believe this will assist in the maintenance of the public interest and of the proper orderly regulation and conduct of its business and of maintaining employment levels as high as possible.

Another critical reform set out in this Bill is the strengthening of banks' prudential capital requirements. The ability of banks to absorb losses on an ongoing basis is crucial for them to be able to continue to service the needs of the broader economy. The G20 and the European Union both have agreed that amending the existing prudential rules on capital requirements is essential to increase significantly the level of capital in the financial system and this will be achieved under this Bill. The Regulator's assessment will ensure that banks are not simply adequately, but are prudently, capitalised in order that they can absorb expected losses, as well as foreseeable future losses, that will arise on remaining loans. As a result, the banks will be better prepared for the more onerous capital rules being developed internationally.

This Bill will ensure that Ireland has a regulatory system that is fit for purpose and that is efficient and cost-effective. The proper functioning of our banking system is critical to the economy and must be protected by the Government. Governments throughout the world have made substantial interventions to protect their banking systems. These interventions have been difficult, are not popular, are difficult to explain or understand but have been necessary. In the steps taken by the Government, its overriding objective has been to maintain and recreate a functioning banking system, ensuring a valuable flow of credit to businesses and households in this economy and this Bill will provide a further step towards so doing.

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