Brian Stanley (Laois-Offaly, Sinn Fein) | Oireachtas source

The Central Bank Bill 2014 does two distinct things. The Bill may be rough around the edges. It would be tempting to say it is a purely technical Bill, but that is not the case. The two substantive articles in this Bill touch on very important issues. The first relates to the potential sale of up to €1 billion of mortgages from ICS Building Society, which is part of Bank of Ireland. It is a reflection of the times and the state the country is in that there is only one building society in the State.

We fear the Bill could become the vehicle for the sale of a loan book to a vulture capital company, as we have seen with Bank of Scotland and IBRC. I accept the assertion of the Minister and his Department that this is unlikely to happen as this book, if sold, will most likely be sold to a new competitor in the market, which will be a regulated company. While we hope this is the case, it is not guaranteed. Legislation is the only way to ensure all mortgage holders are afforded the protection of the code of conduct and other protections. The legislation is with the Government and is also in a Private Members' Bill which has passed Second Stage. There is an opportunity to advance that Bill through the House. The Government should prioritise it and bring it before the Dáil as soon as possible, where it will get the support of both sides of the House.

If it is to be a step to allow a new competitor into the market, that is welcome. The banking sector in Ireland is still very much a sick man. A new injection of competition is much needed. Perhaps the Minister or somebody from the Labour Party can update us on the Government's commitment to establish a State bank. Although the Labour Party made a commitment to do that, we have seen no moves in that direction. We eagerly await it. This manoeuvre relates to the restructuring plan at Bank of Ireland regarding the ICS business. This week the finance committee will hear that Bank of Ireland has reached its target under the mortgage arrears resolution scheme only through the use of legal action against those who are struggling to pay mortgages and householders who are in financial difficulty. Almost 3,500 households are under threat of legal action by Bank of Ireland, which is 14% owned by the State.

In a couple of weeks the Minister will have the opportunity to make his position clear regarding the €843,000 remuneration package for its CEO. We urge the Minister to use the opportunity of his attendance at the AGM to deal with this. He should use his vote to oppose such an obscene pay packet. On this morning's Order of Business he said he would be reluctant to do so because it might send the wrong signal out. I am not sure to whom that would send the wrong signal. I do not know of many constituents who would consider it the wrong signal to find that the CEO of Bank of Ireland was going to have his remuneration package sliced a little. I know few citizens who would lie awake tonight worrying about that.

The Minister told us this morning during Leaders' Questions he would let us know about the issue, and I hope that will happen before the Bank of Ireland annual general meeting and the message will be correct. He must use his vote effectively and send the correct signal to the citizens of this State, who have suffered much hardship.

The second part of the Bill allows for the repayment to Greece of the interest on its loans, and we have no objection to that move. It was cruel in the first place, as despite all the talk of solidarity within the EU, the institution's loans led to a case where profits could be made by lenders on the back of the difficult position of the Greek people. The Greeks have struggled with austerity for many years, creating terrible social consequences for people and particularly those who are less well off in Greek society. Unfortunately, it has aided the creation of far-right organisations which have targeted some of the most vulnerable people in Greek society, including immigrants. That is a shocking development, so it is only right that the accrued interest is returned to the Greek people.

When the heads of the Bill were before the finance committee, departmental officials were questioned as to whether Ireland had ever asked for a similar arrangement as that enjoyed by Greece. We were told the Government had not sought such an arrangement. In the Minister of State's opening address he differentiated between Greece and Ireland, which are two different countries experiencing different circumstances. Nevertheless, the Government did not seek to have interest payments on loans repaid to the Irish people, which is unsurprising. The Government's attempts to reduce the sovereign debt burden have amounted to tinkering at the edges and kicking the debt down the road.

There are two chunks of debt hovering over the State and the Irish people, weighing on our potential to grow our way out of economic stagnation. We learned this week that the so-called deal on the first chunk, the IBRC debt encompassing the private debts of the former Anglo Irish Bank and Irish Nationwide, could be unravelling. The European Central Bank, ECB, has indicated it wants the Irish Central Bank to dispose of the bonds exchanged for the promissory note at an accelerated rate, which is very worrying for a couple of reasons. It could mean the circular nature of the interest on the bonds would be broken and the interest would not be returned to the State via the Central Bank, which is a real concern. Additionally, the scheduled timing and planning of rates would be blown apart.

When the Dáil sat through the night last summer to pass this sleight-of-hand, we opposed the measure not just for the sake of it but because of good reason; we did so because it wound down the bank but did not wind down the debt. Even worse than that, it turned the debt into a sovereign bond, and we have now heard the ECB is not happy with the arrangement and it is now under pressure. This should not be a sovereign debt and it should be lifted from the shoulders of the Irish people. A better deal should have been done on that promissory note.

The second chunk of debt is the sovereign debt linked to bailing out the so-called pillar banks. We were told in June 2012 that the same European Stability Mechanism, ESM, being discussed today would ride to the rescue in this regard because of a seismic shift in policy. The term "game changer" was used. We argued at the time that the Government was overplaying the importance of the June 2012 statement, as there were contradictory signals from EU leaders. We have since seen the prospects of Irish banking debt being recouped by the State being rowed back. The ESM chief, the German Finance Minister and the European Parliament - led by the main grouping, which is associated with Fine Gael - pour cold water on this issue.

The Government now has two battles on its hands and should not be afraid, even at this late stage, to stand up for the interests of Ireland. It must stand up to the ECB and the EU and play to the relative advantages we have. Sinn Féin is content to support this Bill on Second Stage in the hope the issues we have raised can be addressed. We appeal to the Minister and the Government to do so.

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