Éamon Ó Cuív (Galway West, Fianna Fail) | Oireachtas source

I have the height of respect for Deputy Colm Keaveney most of the time. However, the constant mantra from the Government parties which obviously comes from a survey or an opinion poll of views and is based on an easy narrative that it was all foreseeable and so easy to figure out and that Fianna Fáil was solely responsible for what happened is given the lie by an analysis of the policies brought forward by Fine Gael and the Labour Party in opposition, when they had access to the exact same information and all the time they were calling for more and more expenditure. At no time did they seek more taxes such as, for example, a property tax. In fact, if one looks at the manifestos of both parties in 2007, one will see clearly that they were calling for "More of the same. We are not hitting the wall." That is the reality. As the Minister of State, Deputy Brian Hayes, knows, now that he is in government, nothing goes to the Cabinet in terms of economic information that is not available publicly either before or very shortly afterwards. Therefore, to say we had knowledge of a lot of things to which the rest of the country was blind is just not true. I say this not because I am particularly interested in raking over what happened in the past because I am happy I always acted in good faith as a Minister and my conscience is absolutely clear; rather I say it because, if we want to solve the problems of today, we have to understand the collective problem that arose in the past.

Deputy Colm Keaveney said we should not have taken on the bank debt. I have to give credit to the Taoiseach who was honest enough to admit that there was no choice but to do so for three fundamental reasons. The first was that the European Union would not accept a burning of bondholders.

The second is they would have taken us to court. The third is that if we had done so unilaterally, it would have closed every bank in the country. It is a simple, mathematical, absolute certainty. We would have burned deposit holders all across the country because the entire banking system would have collapsed. I agree with the Government, although it is well known that I would have approached matters in a slightly different way, that we must have the bank issue resolved. That is why there are promissory notes, rather than bonds or other such measures. That was always part of our long-term plan. I will go further and say there is a moral obligation on the German, French and other banks that lent to this country to accept at least half of the liability created. If I lent to a person, he or she lent on and the middle person was not get paid, the person who gave the initial loan could not expect to get his or her money back.

I can understand the fear in Europe if one were to let rip on bondholders. One must allow for the fact that much of the money in bonds, again, contrary to the illusion created that it all belongs to Goldman Sachs, mainly belongs to ordinary people in life insurance and pension funds. Therefore, I can understand why an unscrambling of the bonds is a problem. It is much more important for us to say that no matter how we arrived where we are, we have huge challenges to face and they are getting worse. I was interested to hear Deputy Colm Keaveney say we should now try to burn bondholders such as was done by Greece. One of the interesting issues one would have to examine in the context of burning sovereign bonds is that there has been a nationalisation of bondholdings and that where one year ago 18% of them were owned within the country, the current statistic is that 28% of sovereign bonds are now owned by Irish interests, according to the National Treasury Management Agency. Therefore, if one were to go to burn them, one would be burning a lot of people one did not intend to burn.

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