Pearse Doherty (Donegal South West, Sinn Fein)

I am sure we all remember the 2007 election and the promises that the economy was on a sound footing. I have a 53-page document which I will make available to Members. It outlines what Sinn Féin continued to say in the period investigated in the report. The party repeatedly tackled Ministers regarding their failure to take any measures to stop the escalation of house prices. We repeatedly questioned Ministers regarding the development of a property bubble and we called for the introduction of a tax on second homes to curb growing house prices which were seeing investors price first-time buyers out of the market. We opposed the cutting of capital gains tax on the basis that it would fuel the property bubble and make it more profitable to speculate in property than to run a business. We called for the ending of tax breaks which were fuelling the property bubble and we warned of the dangers inherent in an over-reliance on the property sector for revenue and for employment. We also called for pre-emptive training of workers in vulnerable sectors of the economy, including manufacturing and construction. Any examination of Sinn Féin's Dáil record between 2002 and 2007 verifies this. Due to limited time I will not read from the document but I will make it available.

The Nyberg report highlights Irish characteristics of the crisis specific to a deliberate and willful suspension of disbelief; the suppression and punishment of any dissent; and deliberate minimising of responsibility, with no accountability whatsoever. What is worrying is that there is a clear and present danger that after this report, the Government will declare that the problems and features leading to this crisis were confined to banking, banking supervision and financial regulation in this period. There is a danger that we will be told that they have now been addressed and that every other area in the Irish public sphere presents absolutely no evidence of these failings.

The real problem is that many people holding positions of power, authority and influence will like us to believe this. Fianna Fáil would like us to believe that the omission from this report of any blame on its part is a pardon on its behalf when this was explicitly omitted from the terms of reference. Fine Gael and Labour would like us to believe that it was the bad governance of the previous Governments and the bad regulation and oversight of and within banks but we know a Government is only as good as the Opposition that checks it. They would like us to believe that swift and decisive action is being taken when they are blindly leading the people of this State into another crisis led by the EU and IMF and which could sink this country.

The continuation of this mantra that all has changed is the principal reason Ireland is struggling to recover from this largely self-inflicted downturn. It seems that the more things change, the more they remain the same. The omens are not good, given that the same worn out and passive establishment is still indifferent to issues of reform and matters of process even though the lack of accountability and the lack of concern for conflict of interest remain at the heart of the current crisis facing Ireland. All we have to do is observe the stubbornness and pigheadedness of the same parties who refuse to burn bondholders and accept that Ireland's debt burden is unsustainable. This new Government, similar to the last, is sleep-walking into a crisis.

It is all too easy to blame the "herd culture" but the buck must stop somewhere. People want and deserve answers, and this report displays that every sector or link in the chain failed. The budget is the instrument used by the Government and Department of Finance to control the country's finances. Throughout the period leading to the crisis, the Government incentivised risk, speculation and, essentially, the foundations of this crisis. It is not sufficient to look back and criticise what went wrong when the mechanisms and policies of the crisis are still in place and being implemented. We cannot just criticise the last Government when the new one is administering the same policies as those of the EU and the IMF.

The real cause of our crisis has been the financialisation of economic policy, in which investors were incentivised to invest in financial speculation rather than in industry or services. Successive Irish Governments have bought into a policy consensus that believes long-term economic growth should be based on deregulation of domestic and international banking; withdrawal of the State from the functions of the central bank; incentivisation by government of speculative investment via low tax regimes and generous tax breaks; incentivising risk in banking and finance; and privatisation and market liberalisation. Given that this policy consensus has dominated the State for so long, it is little wonder that investors and bankers took such risks and regulators failed to regulate.

The evidence provided in this report cannot be used in any criminal or legal proceedings. While Government members have indicated that they to see prosecutions and convictions, the most surreal aspect of this crisis is that most of the people instrumental to it did not break a single national law. The culture and mechanisms that sculpt the law are the same as those that fostered the crisis. While the law might never be able to prosecute those who have cost the State €100 billion and brought us under the receivership of the EU and the IMF, people who choose to feed their families instead of meeting their mortgage repayments could have their homes taken away. Someone who does not get a dog license will spend time in Mountjoy Prison, while someone who prioritised profit over risk will retire on a handsome pension.

The sick thing is that this has garnered large-scale acceptance. This is the norm, it is the dominant culture. From the start, this report was never going to draw a line in the sand with regard to the banking crisis. How could it, when we are still beholden to the bondholders who are being rewarded for their gambles? We predict that this House will be looking at another report in a few years' time - one that will chronicle Ireland's descent into disorderly default. We will pay yet another outside expert to use the gift of hindsight to tell us once more that a herd mentality threw us into economic, financial and social catastrophe. For the benefit of any such future report, Sinn Féin wants to put it on the record that the debt burden of the State is unsustainable, and that without organised burden sharing and acknowledgement that the Irish sovereign has taken on too much debt, there will be a disorderly default. We state again that our debt to GDP ratio could reach 128% if we continue along a path of fiscal consolidation without growth. The series of austerity budgets that the Government plans to introduce, as promised under the EU-IMF programme, will make the situation worse.

Our unemployment rate for this year is already hitting levels predicted for adverse conditions. People are under attack from a raft of austerity measures to be imposed by the EU, the IMF and the Government. While Brussels, Frankfurt and Washington discuss how best to extract money from the battered Irish economy - and continue to avoid the elephant in the room, which is senior bondholders - the Irish economy limps from crisis to crisis and is slipping into another critical phase. The State needs debt relief proposals for those struggling to pay their mortgages. We need a proper stimulus package that will invest in jobs and the domestic economy. We need a substantial change in policy direction and an acknowledgement that tweaking the EU-IMF programme at the edges will not deliver substantive change. Our debt needs to be restructured here and now, and not some time in the long-term future. We need to impose burden-sharing on senior bondholders, given that Pimco, one of the largest bond funds in the world, has already stated that senior bondholders need to face losses. In addition, the recapitalisation of zombie banks must halt immediately.

A tap has been left on. Resources are being drained from the economy. Funds that are urgently needed to allow the economy to grow have been diverted to pay off private investments. I am sure the Minister will dismiss, as he did earlier, everything being said here - all the warnings we have repeated today and will continue to repeat until they sink in. The Government, Fianna Fáil, the EU, the IMF and the ECB will dismiss everything I am saying. As in the period 2002-07, Sinn Féin refuses to be part of a consensus that will walk the Irish people into another crisis. We did not follow the flock. We spoke up - and, unfortunately, we were right. Just as reliance on the construction sector, consumption taxes and deregulation led us into this crisis, so will adherence to the EU-IMF diktat allow it to continue. This debt burden is unsustainable now. When we read reports about this crisis in a few years' time, they too will tell us so.

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