Finian McGrath (Dublin North Central, Independent) | Oireachtas source

I thank the Leas Cheann Comhairle for the opportunity of speaking in this urgent debate on certain aspects of the banking crisis. For many years I have made my views on this issue known, nationally and locally, so I have ruled myself out of the proposed banking inquiry. I have major concerns about this inquiry, that it will become too political and not deal with the real issues, the causes, the effects and the urgent need never to let such a crisis happen again. It needs to deal with the core issue of greed and rampant capitalism. People should not be afraid to say that in this debate.

It gets up my nose to hear some commentators say that we all went mad during the boom, borrowing and spending during the Celtic tiger years. Many did not do that. They got on with their lives and tried to stay out of debt even when we were bombarded with letters from banks and lending institutions, egging us all on to borrow or buy apartments in Abu Dhabi or elsewhere. That is how it was but many ignored the pressure and now they are paying for the actions of others. This should be said of the majority of decent people who go out to work every day and those who are unemployed, who did not get involved in this rampant greed. That to me is a grave injustice and people need to accept that reality.

Let us quit the spin and the waffle and deal with the truth and the facts. The Government may spend €20 million on this inquiry but we find it difficult to get €100,000 for an excellent child care service to save 260 children in the Darndale area and for 100 jobs in an area that needs jobs and investment. I raised this issue here a couple of weeks ago. That is the kind of front-line service and debate we should have. These services have suffered and should not be excluded from this debate. Last night, €30 million was granted to Páirc uí Chaoimh in Cork yet the Government cannot find €100,000 for a child care service in Darndale, money for housing or €100,000 for a football stadium. We need to be realistic and get our priorities right. We need to be open to different ideas about the type of inquiry we should have, many of which could be very effective.

According to "Brian’s Blog" on planware.org:

We need is [sic] a new type of inquiry which is a mix of tribunal and commission and provides for membership by politicians and others. It should have subpoena and discovery powers, take evidence under oath, make findings, exclude lawyers, be open to public and televised, have an independent chairperson, engage expert support staff, hold private hearings by exception, have power to refer to . . . [the] Gardai and so on. There are plenty of examples of this type of inquiry including the US's Financial Crisis Inquiry Commission which is examining a much more complex crisis than Ireland's and required to report by the year end...

The Government needn't spend three months scoping its flawed approach to a banking inquiry. Instead, it should look at the terms of reference for the Financial Crisis Inquiry Commission. Most of them are relevant including role of regulator; monetary policy and availability of credit; accounting practices; tax incentives; capital requirements; credit rating; lending practices; concept of "too-big-to-fail"; corporate governance; compensation structures and levels; legal and regulatory structures; quality of due diligence; and fraud and abuse. To these, I'd add role of media and commentators; role of ministers and government departments; and relationships between politicians, developers and bankers.

Needless to say, a proper inquiry would not stop at September 2008 and should investigate the basis for the bank guarantees (relating to liabilities exceeding €400 billion), Nama (cost to taxpayer unknown but could exceed €10 billion), nationalisation of Anglo Irish Bank (€4 billion injected and another €6+ billion to follow) and provision of €7 billion in preference shares to Bank of Ireland and AIB (at a time when their combined market capitalisation was a fraction of this) with billions more to follow.

These are the types of financial transactions that have to be examined by inquiries.

Writing in thejournal.ieDamien Kiberd reminds us that we have already had:

(1) the Honohan Report

(2) the Regling-Watson Report

(3) the Wright Report; and

(4) the Nyberg Report.

The authors of these reports had much in common. They were largely academics and senior public servants. They were not business people or even bankers.

There is also the problem of Deputies and Senators running a bank inquiry. Time is a huge problem.

According to Eoin O’Malley writing in thejournal.ie:

TDs and Senators simply do not have the time to conduct many inquiries properly themselves and perform their roles as legislators/ representatives fully. Even in normal committee proceedings TDs line up to ask the same question but often don’t even hang around to listen to the answer. If you look at one of the reasons for the success of the DIRT Inquiry it was because previous work by the C&AG had already established many of the facts of the case.

That is being said behind closed doors. Many Deputies will spend two days a week on this and will be off the pitch for legislation and their local communities. We need to address this because it will be a very time-consuming project. O’Malley continues:

The Commission of Inquiry is a better model. There are issues about whether it should be in public or if it should be chaired by judges or a group with expertise in the area. The Nyberg Report on the banking crisis was a good example of a commissioned inquiry working. But the main issue that is rarely considered in popular commentary is who commissions the inquiry.

The 2004 Commissions of Investigation legislation that the Nyberg Report was a product of has at least one major flaw. Commissions are set up by the executive, exactly who parliament is supposed to scrutinise. It’s for this reason the excellent (but not very juicy) Nyberg report wasn’t able to venture too deeply into government decision making.

I put forward those proposals because it is important that we hear different views and dissenting voices on this issue.

The Technical Group has nominated Deputy Donnelly. I would not get involved because I have made many comments on the banking crisis in recent years. I commend Deputy Donnelly as the representative of the Technical Group and I know he will do an excellent job because, as he told me, one of the main reasons he was elected was to push this issue.

Someone who has been excluded is Deputy Peter Mathews who also has a major contribution to make to this issue. He should be included as a member of the select committee of inquiry. A parliament that excludes people who have a special knowledge, skill and interest in the issue of the banking crisis and the financial services and that does not include people like Deputy Peter Mathews is making a major mistake. It is not an inclusive democratic parliament if people like him are excluded from this, particularly when it would be acknowledged across all parties that Deputy Mathews has made a major contribution to the debate on the banking crisis and the financial crisis. I appeal to the Minister and the Taoiseach at this late stage to add an additional place to the select committee to include him in order that it can get on with the job. We nominated Deputy Stephen Donnelly who is a man of great ability.

I will conclude with a quote by Damien Kiberd with which I totally agree. Recently he wrote:

This country is suffering from paralysis by analysis. The only people to gain are lawyers. They're the guys who keep the meters running every time you hear the words "Tribunal, public inquiry or court case. [...]

The bureaucrats who were responsible for economic management and the regulation of banking from 2000 to 2010 have almost all retired, as have the key political figures. Almost all of the major bankers have moved on too.

I welcome this debate and urge the Minister and the Government to listen to some of the sensible proposals in regard to the banking inquiry that have been put forward today.

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