Brian Lenihan Jnr (Dublin West, Fianna Fail)

Deputy Feighan expressed public anger about the country's economic position. I am sure he has examined the Watson and Regling report, which traced the causation of the economic crisis we are in. One of the great strengths of this country's economy has been its continued robust export performance. There was a substantial increase in the number of people in the workforce in the 1990s and the 2000s. Much of that strength has remained in the economy. A major crisis was created by the extraordinary property bubble, which was fuelled by and large by the availability of cheap credit after Ireland's admission to the eurozone. It is not just a question of the banks, however. The property bubble made increased tax receipts available to successive Governments. Those moneys were used to finance expenditures which were unsustainable. That is the essential reason for this country's severe economic downturn in late 2008 and 2009. If the Members of the House do not collectively understand the reasons this happened, we will not devise the correct policies that will enable us to emerge from these difficulties. I understand why people are angry with bankers, as Deputy Feighan said. When we talk about the gap between receipts and expenditure that has to be filled, we should bear in mind that the estimated annualised cash cost of the long-term write-offs in Anglo Irish Bank and Irish Nationwide is €1.5 billion. Apart from that, the gap this year between our receipts as a State and our expenses as a State is €19 billion.

The biggest impropriety in the banking sector was the degree and pattern of reckless lending. NAMA has established that such lending took place markedly in the case of Irish Nationwide and Anglo Irish Bank and to a lesser extent in AIB and EBS. The pattern of reckless lending was the core problem in the banking system. At the time of the nationalisation of Anglo Irish Bank, I pointed out that in addition to all the difficulties at the bank, there were serious issues of corporate governance. The Garda Síochána and the Office of Corporate Enforcement have initiated a full investigation into these matters. My understanding is that a large number of personnel from the Garda and the office are involved in these investigations. I understand the relevant interviews have taken place, or are to take place, as part of this wide-ranging inquiry. I also understand that the relevant files are being prepared for submission to the Director of Public Prosecutions. That is how criminal investigations are conducted in this jurisdiction and in neighbouring jurisdictions. I accept that inquiries on the other side of the Atlantic tend to be much sharper and quicker than they are here. The nature of our criminal justice system is such that investigations in this jurisdiction, like those in the UK and France, which are not any different, take a substantial period of time. I refer to complex cases involving commercial wrongdoing with criminal implications. I assure the House that those investigations are well under way and well advanced.

Deputy Flanagan raised the question of the 3% target of GDP, as our borrowing requirement, which has to be reached by 2014. With the exception of Sinn Féin, all parties in this House have signed up to that target. He then asked about the targets for 2011, 2012, 2013 and 2014. Of course the fiscal plan will set out those targets and the growth scenarios. The Deputy mentioned negative growth. There is no question of negative growth being a scenario in the four-year plan for growth and budgets.

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