Dara Murphy (Cork North Central, Fine Gael)

I welcome the Bill. As Members will be aware, the Bill replaces the much criticised Credit Institutions (Stabilisation) Act passed in December. It is worth noting the amount of time the Government has spent undoing much of the emergency work and non-work of the previous Government. I commend the Minister for Finance on the work he has done in such a short period of time.

Clearly these proposals will allow the Central Bank to deal with lenders who fail or are likely to fail. The history lessons are there for all of us and it is important we continue to work towards putting in place a banking structure that will give confidence back to our people. The Governor of the Central Bank rather than the Minister will trigger this new regime. It is very important we allow the Central Bank to deal quickly and effectively when problems arise because this clearly has not happened in the past.

The Bill included measures in line with evolving EU principles on crisis resolution and in the light of discussions that will take place with external partners. We must continue to work very hard to co-ordinate our efforts with our European partners. As Deputy Spring correctly said, it is most opportune that we are here working on this Bill at this time when the Taoiseach is discussing our interest rate and other issues pertaining to the country. We all wish him the very best.

In addition to banks, the powers of the Bill will apply to building societies and credit unions. It is important to acknowledge that the credit union commission has been established. The credit unions are doing remarkable work and have done so throughout the banking crisis. The Bill provides for the establishment of a bridge bank to temporarily hold some of the institutions' assets and liabilities. The credit institutions resolution fund is to be established to provide a source of funding for the resolution of financial instability or to prevent the imminent threat of financial instability of an authorised credit institution.

It is crucial we continue to work towards a fairer sharing of the cost of restructuring Irish banks. We must work towards a more transparent assessment of the capital needs of Irish banks, and Irish bankers need to continue to shrink their balance sheets to reduce their excessive dependence on volatile non-deposit funding sources which has been the case to date. Most importantly we must continue to work to restore confidence in the Irish banking sector to get our banks lending to businesses, which we hope will flourish and consequently employ people who will pay taxes and thereby get the country back up and running. It is a rather simple economic model but it is a very clear path towards the country's recovery.

We need to rebuild a competitive, well-managed but also privately owned banking system. In that regard it is very welcome that for the first time in many years we are putting the Government back in charge of how our banking system is structured. We need to work to promote new leadership and management in our banks. As has been said, we have many good people working within the banking sector but the leadership they received has let down many people in the State, both those working for the banks and people who deal with the banks in many key areas. Banks should squeeze their costs before their customers. Even of late we have seen far too many examples of senior people in the banking sector continue to take perks that should be discontinued in the current climate. Once they are made stronger, we must work as a matter of urgency to return the viable banks into private ownership which will foster greater competition in the marketplace. Great work is already being done in shutting down dead banks.

I commend the Minister on the legislation and wish him the best of luck in the future. As has been said on many occasions, the Government is at the start of a journey. In its first term since its election a few months ago it has done some very good work. I join Deputy Spring in wishing everyone a good summer. I do not need to sell my county of Cork as hard as the Kerry people have to sell theirs, but they are of course all welcome and we might see Deputy Spring and others from his county in September again in Croke Park.

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