Joan Burton (Dublin West, Labour)

Two years on from the original bank guarantee, the Government has still made no progress with the introduction of a special resolution regime for the banks. Once the guarantee was granted, the introduction of such a resolution mechanism was the only realistic way in which the financial burden could be shared appropriately between taxpayers and the banks' investors. As of midnight, some €40 billion in bank liabilities — that is not a trifle — will fall outside the guarantee when it expires. In the absence of a bank resolution Act, it will be difficult to ensure that the relevant bondholders make a fair contribution to cost of the banking failure. The only exception in this regard relates to the sub-debt, which only represents a small proportion of the €40 billion to which I refer. As Deputy Noonan stated, this sub-debt has already been regularly subjected to sales by the institutions and to buy-backs.

In the weeks before the original blanket guarantee was put in place, the Labour Party called for enhanced protections for ordinary depositors. However, these protections should not have been extended to the professional investors who took a punt on bank loans. The Governor of the Central Bank, Professor Patrick Honohan, has since vindicated this position in his report on the banking crisis.

A system of omerta has been official Government policy on the banks from the outset. Labour was briefed on this motion at 10 a.m. and the Department was unable to answer basic questions put to it by the Labour Party. The following are the questions we asked: will Irish banks be facing a further funding cliff in December, when the guarantee extension is set to expire, how much debt has each institution guaranteed under the ELG scheme to date — the Minister stated that it is €150 billion in total — how much debt is expected to be issued under the ELG scheme between now and the end of December, will the government urgently introduce a special resolution scheme for banks and is a further extension of the guarantee beyond December envisaged? The latter part of the Minister's contribution would appear to indicate that the answer to the final question we posed is yes.

The Government has also choreographed events in such a way as to give the Dáil the least amount of time possible to consider the motion on the renewal of the bank guarantee. The Dáil has been in recess for 12 weeks. When the Government decided that the new session would commence today, it knew that a decision on the renewal of the scheme would have to be made by midnight. Why was the Dáil not brought back earlier in order that it would have adequate time to consider the renewal proposal? We are also being asked to make this decision on the guarantee a day before the Financial Regulator is to disclose the full extent of the likely cost of bailing out Anglo Irish Bank.

Earlier today, the Taoiseach stated that he did not know the figures. I have many different views about Deputy Cowen, not all of which are complimentary. However, the suggestion that the Taoiseach in charge of the greatest disaster in our history has not received good and sound advice on the ballpark figures that will be revealed tomorrow is fatuous in the extreme.

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