Pearse Doherty (Donegal South West, Sinn Fein) | Oireachtas source

I am sharing time with Deputy Tóibín.

Ar dtús báire, ba mhaith liom fáilte a chur roimh an reachtaíocht seo. Mar atá ráite ag an Teachta McGrath, tá seo fógraithe le blianta fada agus níl a fhios agam cé mhéid uair atá sé ardaithe agam leis an Taoiseach, an Tánaiste agus an leis an Aire Airgeadais, ná cé mhéid uair a d'fhiafraigh mé cén fáth an raibh moill á chur ar an reachtaíocht seo.

Bhí dhá phíosa reachtaíochta faoi leith fógraithe ag tús na bliana, ach nuair a fheicim an reachtaíocht seo, tuigim go bhfuiltear curtha le chéile anseo, ach ní fheicim réasún ar bith cén fáth go raibh moill de tri bliana curtha ar an reachtaíocht seo a thugann deis dúinn infheistíocht chuí a dhéanamh san eacnamaíocht. Seo infheistíocht atá á chuartú ag go leor den phobal agus ag gnólachtaí agus tá daoine ag scairteadh fána choinne. Ar an drochuair, idir an trí bliana sin tá go leor daoine a d'fhág an tír seo mar nach raibh na deiseanna ann dóibh agus mar nach raibh an infheistíocht déanta agus mar go raibh an eacnamaíocht chomh lag sin nach raibh poist ar fáil. Ar an drochuair, b'fhéidir go bhfuil siad ag éisteacht leis an díospóireacht seo in áiteanna mar Ceanada, na Stáit Aontaithe nó An Astráil.

I am glad we are finally discussing this Bill today. It must be the most announced legislation this Government has introduced, but we can finally get down to the detail and cut through the spin now that the legislation has been published. The creation of a strategic investment fund was first announced in September 2011. It was re-announced a number of times, and again in June 2013. Now, in May 2014, more than three years after the Government came to power, it reaches us for the start of the legislative process. On the second announcement I said it was long overdue; now it is just very late. Billions have been squandered from the National Pensions Reserve Fund on zombie banks in the intervening period. This is not just a political point but a real criticism. Three years have passed without any of the type of State investment that is required in the appropriate measure. At a time of emigration and high unemployment the State needed to step in and invest, but the Government sat on its hands and allowed the economy to shrink, our young to leave and our public services to deteriorate. We must compare how swiftly the Government was prepared to legislate to cut civil servants’ pay and remove the protection of the family home with how long this legislation has been in preparation. That is the story of where this Government’s priorities lie. Investment is an afterthought, something to consider three years later.

My party has always argued for, and shown how, investment in a stimulus package, coupled with a fairer way of adjusting the budget, could put us on the road to recovery and help us to reduce the deficit as required. I therefore welcome this conversion to the principle at least, although the detail shows how the conservative hand means in practice that this new vehicle will be severely limited in how it can kick-start our economy. Stimulus has always been part of the solution and I am glad the Government is coming around to that Sinn Féin position. It must be a well-directed and effective stimulus, but I fear that is where this Bill is not as good as it should be. We will seek to amend the Bill on Committee Stage to improve it and to make is as useful as it must be if the full benefits of stimulus are to be realised. While this Bill marks a positive step towards sensible economic planning, it still bears the hallmarks of a conservative and austerity-addicted mentality in many ways. It also bears the fingerprints of the troika squeezing out the potential for a positive State-led economic initiative. I doubt it met much resistance from this Government.

Sinn Féin has shown how we would leverage the available NPRF to make a real impact in the economy. We would have had it up and running by now, investing on the necessary scale. This Bill is frustrating for those of us who wish to see a real stimulus package put in place. The concept of a strict adherence to the need for a commercial return is one with which we are uncomfortable. It is a measure of how much we remain under the thumb of EU law that the act of investing in our economy has become such a tortuous exercise. In fact, the rules are so fixated on proving a commercial return that the potential for real and immediate impact is blunted. Where is the guarantee of actual benefits to the real economy if each project must be vetted through committees and must find a commercial partner in times of economic hardship?

Sinn Féin has put forward proposals that would produce an economic return on investment, but these rules appear to be crippling the possibilities. Simply put, building hospitals, schools and other infrastructure sometimes goes beyond a commercial return. The fund’s limits to economic activity and employment would appear to rule out social or environmental investments which in time would undoubtedly benefit the country. How is this fund going to help ease the crisis in social housing, for example?

The Bill lacks a vision. It is not an ideal vehicle for the type of stimulus Sinn Féin has envisaged and championed. The opportunity for a State–led strategic wave of investment is severely limited by the use of committees through which each project must be filtered. The strict requirement for a private partner, possibly up to the point of being a 50:50 partner, will reduce the effectiveness of any investment from the State’s point of view and, as we have seen previously, will benefit the companies rather than the State or society or those in need of work.

Last week, the Government announced it was establishing a strategic banking corporation - that is, a company. Those words are carefully chosen. It is a strategic banking corporation, not a bank. In a reply to me last night, the Minister for Finance, Deputy Noonan, admitted that the strategic banking corporation will not have a banking licence.

A bank without a banking licence is not a bank. As such, when will the programme for Government commitment to establish a strategic investment bank be met? One cannot simply set up a company and include the word "bank" in its name and call it a bank. A bank has a banking licence. That is the rule and as basic as it gets. This vehicle will not have a banking licence. Last week's plan amounted to a German bank paying into a fund from which money will be given to the banks in the hope that they will lend to the real economy. However, there is no safeguard to prevent the banks simply soaking up this money as they have been doing or to prevent it being drawn down.

I have noted already the complex and perhaps too rigid tests that must be passed before any investment can be made in the real economy. There is, however, a part of the Bill which allows the Minister for Finance to write a blank cheque. Section 42 permits the Minister to use the National Pensions Reserve Fund to bail out banks once again. If one wants to invest in the real economy, in broadband, housing, water or in the infrastructure our communities are crying out for, one must go through all of the rigorous tests and have a private investor in place. One must pass all the different committees and undergo the various scrutiny processes and there must be a return. However, if the banks come knocking on the Minister's door and, after consulting with the Central Bank, he or she deems the billions that have been raised by the Irish people should be squandered into this bank, he or she can direct the fund manager to do that. Section 42 is an appalling section and requires greater scrutiny and a proper explanation from the Minister as to what the Government is doing here.

I note that when one looks at the accountability of the chief executive officer, one sees that he or she is required to come before the Oireachtas committee and answer questions on any issues members raise. However, he or she is not allowed to make any comment on any policy or order from the Government or the Minister. If the Minister had to turn around and say "Listen folks, AIB or Bank of Ireland is in trouble and we need €4 billion of the €6 billion you were planning to invest in the real economy for the bank", the CEO cannot comment but must oblige the Minister's order.

Sinn Féin is opposed to putting NewERA on a statutory footing. We are opposed to what NewERA stands for. It is a vehicle for the privatisation of profitable State assets, including Bord Gáis, the ESB or Coillte. Putting NewERA on the footing proposed in the Bill is further proof that the troika mindset is still very much being in place in Government Buildings, Fine Gael and the Labour Party.

While we will deal in greater detail with many sections on Committee Stage, I wish to comment on the part of the Bill dealing with the State Claims Agency and the centralisation of claims made against the State. Claims have been made in the past and claims will emerge in future. They may result from institutional abuse, as happened in the case of the Magdalen laundries, or from tribunals of inquiry as we saw with the Moriarty and Mahon tribunals. Some of the costs associated with those tribunals have not yet been dealt with as court challenges continue in relation to the level of costs awarded. It is a matter to which I will return on foot of information I have received recently on the Moriarty tribunal in particular. An early section of the Bill provides that any order under the legislation must be laid before the Houses of the Oireachtas and there are then 21 days in which an order may be quashed by a vote in the House. The section in the Bill dealing with the State Claims Agency allows the Minister for Finance, following consultation with the Taoiseach and Attorney General, to direct - not order - the State Claims Agency to cease paying claims in any directed area. That is a matter of concern given our past. For example, it emerged in October last year that €635,912 had accumulated in third-party costs for the Fine Gael Party in relation to the Moriarty tribunal. In the first quarter of this year, nearly €110,000 was paid for legal costs for the Haughey family.

I raise this issue because the Bill provides the Minister of the day with the discretion to direct the State Claims Agency, with which direction it must comply, to cease paying any type of claim. If the agency was to handle a tribunal in future, the Minister could direct it to stop paying any new claims. That is deeply concerning given the involvement of the political parties, particularly Fine Gael and Fianna Fáil, in benefitting from these costs in the past. One would not want a situation in which, if Fianna Fáil were, God forbid, in government again, it could say that payments should stop. The matter would not come to the floor of the House. We must examine this. It should be an order at the very least, not a direction, as that would mean it would be voted on in the House.

I have outlined the many concerns Sinn Féin has identified with this Bill. We recognise that it has the potential to act as an important element in an economic recovery. While it differs greatly from the stimulus vehicle we would have designed, it must be progressed. Enough time has been wasted by the Government. Let us get on with stimulus. The Bill at least marks a starting point in theory. The danger is that it will not amount to anything more. It may end up being a vehicle through which no lending occurs due to its strict nature. We will deal with this on Committee Stage but I want to see where the Government is looking at this. Will targets be set? We have had targets that were placed on AIB and Bank of Ireland in respect of lending into the real economy but those targets no longer exist. The banks did not meet them. It does not seem that even targets have been envisaged by the Government in terms of the investment of more than €6 billion, which will be at the disposal of the new agency, to help to kick-start the economy.

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