Mary Lou McDonald (Dublin Central, Sinn Fein)

I will not need 28 minutes. I am pleased the Bill protects whisteblowers from civil liability and victimisation. I am pleased also that this protection extends not only to employers who are implicated in the detail of information provided but also to those outside the employer-employee relationship.

The Bill goes further in providing a mandatory regime for those with senior or important functions within financial service providers. There should always be a compulsion to disclose any information relating to breaches of law or good practice, particularly by those holding senior management positions. One concern I have with this section is the absence of any compulsion on the Central Bank to act on information provided by whistleblowers. I understand that it is not possible to act on every single piece of information provided, but the experience of many whistleblowers under the previous regulatory regime suggests that some form of obligation to act should be inserted into the Bill. Sinn Féin will bring forward sensible amendments on this matter, in the spirit of the Bill itself, on Committee Stage and I hope the Minister will give them due consideration.

I am also pleased to see the significant increase in penalties available to the Central Bank for persons or financial service providers in breach of their legal requirements. That should go some way to giving the regulator the teeth that were so badly lacking in the years preceding the financial crisis of 2008.

Sinn Féin is often critical of legislation laid before this House by Government, but we have always said that we would support proposals that are positive. The Central Bank (Supervision and Enforcement) Bill 2011 is one such proposal and is a welcome addition to the regulatory powers available to those bodies and individuals tasked with ensuring that financial service providers behave in a way that is correct, responsible and in the public interest.

I wish to take this opportunity to make a few more general remarks about the regulation of financial service providers. As highlighted in the Government's own report of the commission of investigation into the banking sector, our recent financial crisis was caused by a range of factors. Regulation did exist that could have been used by the regulator in the years leading up to the crash of 2008. However, neither the regulator himself nor the Ministers of the day were willing to fully use the powers already vested in them to address the reckless and inappropriate behaviour in our financial institutions. While it is clear that there is a need to strengthen the regulatory code there is also a need to strengthen the obligations on the regulator, the Central Bank and Government to ensure they act in an appropriate and timely manner to any breaches of existing regulations. While the recent intervention by the regulator on the issue of mortgage interest rate charges is an example of this, it must become a more frequent practice and one that is fully backed up by the strong support of Government.

There is also a need to recognise that regulatory breaches or bad practice can be incentivised by other areas of Government policy, such as monetary policy and tax policy. Reckless behaviour by financial institutions prior to the 2008 financial crash was incentivised by the excessive tax breaks provided for by successive Finance Acts under the previous Government and, crucially, by lax monetary policy pursued by the European Central Bank. If the policy and legislative environment in which our financial service providers operate actively encourages them to behave in a way that is detrimental to society in general, then that policy environment must also be subject to change.

I make these brief comments in order to demonstrate an important point, namely, that a responsible financial services sector requires much more than strong regulation. It requires the political will to enforce, from the regulator's office through to the Governor of the Central Bank and up to the Minister for Finance and the Taoiseach. It also requires an end to reckless and unsustainable tax policies, particularly with respect to tax breaks, many of which continue to be on our Statute Book. Crucially, it also requires an end to the one-size-fits-all monetary policy imposed on by the European Central Bank. While the policy of cheap money pursued in the early years of the euro is no longer with us, the one-size-fits-all policy is still in place. The pendulum has clearly swung too far, much to the detriment of small and medium-sized enterprises and those who rely on this sector for employment. Excessively restrictive lending is just as bad for society and the economy as excessively loose lending.

I wish to again place on the record Sinn Féin's full support for the Bill and our intention to seek to amend the Bill in a constructive and positive spirit on Committee Stage but I also urge the Government to go much further in ensuring that the conditions that led to the financial crash in 2008, and in particular the fiscal and monetary environment which incentivised the crash, are subject to real policy and legislative change so that the terrible events of the crash are never ever repeated.

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