Stephen Donnelly (Wicklow, Independent) | Oireachtas source

I think we need an inquiry into what happened. I listened carefully to the Taoiseach's opening statement, which I broadly welcome. I think the Tánaiste strayed unnecessarily into politics right at the start. It was an unnecessary tone with which to open the debate. I felt that the Taoiseach got the balance reasonably right.

We already know a few things. We have had three reports. The report that was published by Klaus Regling and Max Watson in 2010 looked into the macro-situation and the institutional conditions that led to the crisis. In the same year, the Governor of the Central Bank, Patrick Honohan, looked at the Central Bank's regulatory failings. In 2011, Peter Nyberg produced a report looking at the policies and practices of the banks, the public authorities and the auditors that drove the country towards the bank guarantee. I hope we will not spend too much time there because there are many things we do not know. There would be great value in knowing some of them. There are many questions to be asked about specific events leading up to the guarantee, such as the failures of the Cabinet, the Department of Finance and the Dáil. A reference to the role of the Dáil was absent from the opening statements of both the Taoiseach and the Tánaiste. They referred to the Cabinet and the Government of the time. I remind Deputies that Dáil Éireann is constitutionally obliged to hold the Cabinet to account. I hope the Dáil is looked at as well. There are questions to be asked about what the Dáil did. We should also focus on the foreign actors, including the ECB, foreign Governments and foreign banks. I would like to see these things discussed.

We do not know the rationale for the guarantee being so wide. Regardless of the decision to offer a guarantee on the night, I think the public is very interested in the nature of the guarantee. I would certainly like to know why it was so wide and why it went backwards. In his report, Patrick Honohan raised the many unanswered questions regarding the rationale for continuing with the guarantee. He concluded that he could broadly understand the rationale for the guarantee that existed on the night, but that the decision to implement such a broad guarantee year after year was inexplicable. That is why it is so important for the rationale for the decision of this Government and its predecessor to make payments to bondholders to be examined as part of this inquiry. There could be an awful lot of public value to be had from such an examination.

It is entirely possible that this inquiry is going to fail. Many Members of the Oireachtas will spend a great deal of time on it. It is entirely possible that we will fail. The inquiry could be taken off track by political point-scoring and bickering on the part of those who might try to defend or attack. The timing of the inquiry is extremely unfortunate. The establishment of a banking inquiry in the fourth year of this Government's term is a huge mistake. It is entirely possible that the inquiry will continue until shortly before the next general election. That would make it very difficult for people not to get political, especially if former senior Fianna Fáil Ministers or current Ministers are called around that time. The timing is unfortunate. This inquiry should have been held two years ago.

I was pleased to see the representation on the committee. I have worked with several members of the committee and I know other members of it. I do not know who the two Senators on the committee will be - this was not covered in the introductory remarks - but I hope, in the interests of getting the right skill set, that Senator Seán Barrett is still being considered. I know he is keen to be involved. It would be a great shame if the Oireachtas were to decide not to avail of an offer from a professor of economics to sit on a banking inquiry. Obviously, that is a decision for the Seanad. I hope Senator Barrett is still being considered.

The banking inquiry could be incredibly useful. I recently sat down very late at night to write a piece about the inquiry with an instinctive bias that it will be a complete waste of time. I really tried to challenge my thinking, however, with the result that the piece I finally wrote said the opposite. I convinced myself at approximately 2 a.m. not that it will work, but that it could work. I listed four areas in which real value for the future could be achieved if we can pull this off. First, I hope we will be able to demonstrate that the Government, the Civil Service and the regulators need to be transparent and accountable. Second, I think we will be able to investigate and might be able to show that there is a need for a Parliament that holds the Executive to account, as per the Constitution. Third, I hope we can examine Ireland's case for retrospective recapitalisation because it is important to examine whether there was deception from the banks, as per the Anglo tapes in which a policy of entrapment was suggested. Fourth, we can investigate whether this Government and its predecessor came under much foreign pressure to pay bonds and honour guarantees, etc. In addition, we can look at the level of potential culpability of the banks in the mortgage crisis. We have talked about whether they abandoned prudential lending. Some of them have said they did so. There are many areas in which we could succeed and in which we have potential, but of course many people expect us to fail.

When I was preparing for this debate this morning, I looked at the Edelman trust barometer, which compares the level of public trust in business, institutions and governments across various countries. Last year, Ireland was ranked sixth from the bottom. This year, we were ranked third from the bottom, with Poland and Russia being the only countries to get a worse score. Only the Polish and the Russian people have less trust in their institutions than the Irish people. Given that this year's figures were compiled before the recent revelations about the administration of justice in this country, it is possible that we have fallen below Poland or Russia. Who knows? It is a pretty bleak situation. According to this independent comparative analysis, there has been an almost total collapse in trust between the Irish people and the institutions of the State. The Oireachtas is obviously one of those key institutions. I think people expect us to fail and to descend into bickering and political opportunism. I hope that does not happen.

I would like to conclude by putting two suggestions to the Minister of State, Deputy Kehoe.

The Government could do two things to set this on the right footing and which it might consider before the vote. First, it could add an eighth, non-Government member to end the Government majority. Rightly or wrongly, the Government majority has many people thinking this is a set up because the Government can out-vote the non-Government members on any issue. Adding one non-Government person would get rid of any lack of trust. Second, could the Government, and the other parties, Fianna Fáil and Sinn Féin, not state publicly that they are removing the Whip from their members on the committee?

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