Margaret Conlon (Cavan-Monaghan, Fianna Fail)

I welcome the opportunity to make a contribution in relation to the banks. This is not the first time I have spoken on the banking crisis that has taken us all by storm and rocked us to our very foundations. I welcome the opportunity to speak again.

Members on all sides of the House have been disgusted by the events which brought us to the famous night in September 2008 and the decisions subsequently taken not to bail our banks, bankers or developers, but to keep our economy functioning and our country running. I have made no secret of the fact that I deplore and condemn those people who engaged in reckless lending practices. I hold no court for any banker, builder or developer but I know they brought us to the brink. Of course, people are angry, and rightly so. I am angry myself. I am furious at what has happened. However, anger is not a solution. It is not an answer to the problems and will not get us anywhere. We can continue to bemoan what has happened and talk about mistakes that were made, who is to blame for them and who should have done this or that. However, that will not get us anywhere. We can look back in anger but we must move forward with hope and determination.

Mistakes were made on all sides of the House. I was not here during the good years, and there were many good years, but I remember reading speeches by Members of the Opposition at that time. The all contained calls for increased government spending and reduced taxes. No matter how much was spent or committed to projects and no matter by how much taxes were reduced, people on the opposite side of the House said it was not enough. They said the Government should have been spending more and cutting taxes by more. It is important to place that on the record.

We faced recession before. We had it in the 1970s and 1980s. Anyone who thinks this is the last time we will face a recession is mistaken. We will have recessions in the future because the economy is cyclical. An economic boom is followed by a recession. So the cycle goes, and it will happen again. We are dealing with a difficult economic situation and people who had jobs find they no longer have them. Households find their incomes are drastically reduced. People who have left college wonder if there is a future for them. I see pupils in the Gallery this morning. They are wondering what will happen to them. Will they have a job when they finish their education? These are the questions people are asking. If we work together in the national interest and put aside our differences, we will come through this difficulty and emerge as a better and stronger country.

When things were good we lost many of our values. People were so busy making money and so concerned with their own lives that they forgot about their neighbours and communities. We lost our sense of community spirit. In my own constituency I see a return to that. Communities are getting up and doing things for themselves because they see these times not as something big and bad, but as an opportunity to make things better for their communities.

I will speak for a few minutes about Anglo Irish Bank in plain simple terms. Winding down Anglo Irish Bank on that night in September 2008 was simply not an option. The bank held investments of €80 billion, a figure of huge magnitude. We used to speak about hundreds, thousands and millions but now we have moved on to billions. Those investments were owned by Irish pension funds, local authorities, small and medium sized enterprises and credit unions. It would have been irresponsible of the Government to let that money go. People were angry about what happened but one can only imagine the anger of the ordinary men and women of this country if the money vanished. I acknowledge the taxpayer will pay a high price but we must inject capital into these institutions if we are to prevent them from collapsing.

These injections of funds will add to our national debt but it is not fair to compare them with annual adjustments in the budget because doing so creates the false impression that savings made in the budget will be ploughed into the banks. The cost of resolving the problems of Anglo Irish Bank and Irish Nationwide is a once off addition to the national debt. Typically, countries do not repay their national debts but instead pay annual interest repayments for an indefinite period. This recurring expenditure is the proper figure to compare to the annual budgetary adjustments.

The Central Bank carried out a detailed analysis of potential losses in our banks in coming years and the Department of Finance is working to reorganise the financial sector. Better regulation and organisation is necessary because banks can never again be allowed to behave as they did in the past.

I regret the day when the power to grant or refuse loans was taken away from the local bank managers, who knew their customers' income and liabilities and could accurately assess whether they would be able to repay their loans. They investigated the financial situation of prospective borrowers on an individual basis. That power was transferred to faceless people in a head office somewhere in the ether. These people knew nothing and cared even less about the individuals concerned or their financial histories. They did not have the best interests of their customers at heart because they were more interested in being rewarded for increasing their banks' loan books.

We now have an opportunity to introduce reform but this must be done in a constructive and positive manner. I am fed up with the constantly negative portrayal of this country in the media. From the time one switches on the radio at 7 a.m. until one turns off the television at midnight one does not hear or see a single positive story, with the exception of the historic rescue of the Chilean miners. It is time that we be positive in focusing on the future.

There is broad agreement on the necessity of cutting our budget deficit to meet the EU target of 3% by 2014. We face the challenge of doing this in a way that minimises the pain for the vulnerable and marginalised. We have to consider taxation, public service provision and unemployment figures. We must give people hope that they will be able to return to employment and thereby make a valuable contribution. We must investigate how savings can be achieved through the Croke Park deal. The reality is that we are spending €5 for every €3 taken in. One could not keep one's house going indefinitely under that financial arrangement.

I welcome that the Taoiseach has reiterated his desire to engage the Opposition parties in constructive talks on the four year budgetary plan and that his proposal has been accepted by Deputies Kenny and Gilmore. I think we all agree this is not a time for business or politics as usual. It is important that all sensible and viable proposals are examined in detail. It is most helpful that officials from the Department of Finance have briefed Opposition Deputies on our financial situation. We must leave the bickering to one side and demonstrate that we are putting the best interest of the country and our constituents first. People are not impressed by the negativity that currently exists and, no more than anger, petty bickering and squabbling will not provide a solution. As politicians, we need to put our heads together to give hope to the people we represent.

The 450,000 people who are unemployed will not have hope if we cannot make credit flow into the economy and for this we need a healthy functioning banking system. Any citizen who has money on deposit has a legitimate expectation that his or her deposit will be safe and accessible. If we had not put the bank guarantee system in place, many ordinary people would have lost their hard earned savings.

Despite the difficulties small and medium sized enterprises face in accessing credit, they are making a huge contribution to our economy in difficult circumstances by keeping people at work, producing goods and services and contributing to export growth. To survive, these businesses need credit and working capital. I do not advocate a return to reckless lending practices but if a business had a good record and a viable future, it should be given the tools it needs, including credit, to remain in operation.

The announcement of the bill for Anglo Irish Bank has brought us certainty because we now know the nature of the problems we face. The next step is dealing with these problems.

I commend the Minister for Finance on the way in which he has been dealing with issues pertaining to his Department and to banking. He has been clear, open and honest in providing information. He has had a very difficult job but he has discharged his duties in an admirable manner.

I welcome the comment from Standard & Poor's, which stated this week that concerns about our fiscal and political risks have been exaggerated. It even predicts Ireland will recover from this recession faster than other peripheral European countries. This little bit of positivity that should be highlighted as it is important. It is the kind of positive news that is needed.

We have faced up to the reality of what the bank guarantee will cost. We are preparing the plan to get our finances in order. We are working with Opposition parties, whose viable, credible and workable proposals will be given due consideration. I am not interested in going back over the same problem time and again. I am sick, sore and tired listening to the mantra that we bailed out the banks, builders and developers. Let me say for what I hope will be the last time in this House that we did not bail out any banker, builder or developer. We bailed out and assisted our economy to keep it functioning, to provide jobs, assist businesses and protect the deposits of those who have put their hard-earned money into deposit accounts. I am not interested in playing the blame game and am only interested in the solution.

There is some light at the end of a long, dark tunnel. There are still difficult and painful decisions to be made. I am not under any illusion in that regard. Although the budget will be extremely difficult, if we work together in a spirit of co-operation, we can make it work.

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