Simon Coveney (Cork South Central, Fine Gael) | Oireachtas source

Deputy Halligan did make his point well. It is a fair point. Many businesses in this country have not got fair treatment from banks in recent years. We are trying to rebuild a broken banking system and to force banks to get back into the banking business. That is something they had moved away from as they moved into the business of speculation which was part of the problem in this country.

I am not qualified to comment on the individual case as this is the first I have heard of it. However, it seems to be totally unreasonable to repossess farm machinery on the back of arrears of €3,000. I assume the case is more complex than that. Deputy Halligan must be joking to suggest that anyone on this side of the House is not familiar with the difficulties faced by small businesses at the moment. Everyone on this side of the House hears those stories all of the time. Given that we are in government people expect us to try to respond to them so we hear the stories as much as the Deputy does. We are more than aware of the situation which is why we have driven reform in the banking system and will continue to set targets and ensure they are met in terms of the level of lending. We will also introduce the necessary legislation to try to ease people’s debt management burdens.

On the issue of pay in banks, it is important to state that in many ways it is a separate issue. If one were cut pay in banks, which many would like to see, it would not necessarily mean one would change banking practice in this country. We must do two things. First, make sure that the demands we make of bankers in this country at a senior level are appropriate to the conditions in which we find ourselves. That is why the Government has not broken the cap it set on bank salaries – unlike the previous Government. There has been much coverage in newspapers on the CEO of Bank of Ireland whose contract was put in place in 2009 when a cap did not apply. Since we took office we applied a cap of €500,000 and will continue to do so.

In recent weeks the Government has also made a clear statement to the pillar banks that we want to see a reduction in the salary costs within the banks of between 6% and 10%. We look forward to proposals in that regard from the banks concerned. I assume senior management in those banks will lead by example on any cuts that will apply in the months ahead.

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