Seán Ó Fearghaíl (Kildare South, Fianna Fail) | Oireachtas source

The Government Whip referred correctly to the important work of the CPP in this matter. I pay tribute to the work of the Joint Committee of Inquiry into the Banking Crisis because I believe it, too, has worked effectively and cohesively to date. That is why Fianna Fáil will co-operate with the banking inquiry which is now being established by the Oireachtas.

We have stated all along that if the inquiry is to achieve its aim of a full examination of the events surrounding the banking collapse, it cannot focus solely on the night of the bank guarantee. It needs also to examine the lending culture which prevailed in the banks, the role of external auditors and advisers, the pressure brought to bear by the ECB not to impose losses on senior bondholders, and the decisions to establish NAMA and liquidate IBRC. We welcome the inclusion of these matters among its terms of reference and also the examination of the design flaws in the euro project itself as a factor in the subsequent difficulties Ireland and other countries endured.

However, we retain our view that the model chosen by the Government runs a real risk of providing an incomplete examination of these events. We have repeatedly stated that the Tribunal of Inquiry Bill 2005, if enacted, offers a cheaper, faster and more efficient method of investigating matters of urgent public concern where other private inquiry mechanisms, such as commissions of investigation, are inappropriate.

It is likely that the Irish people will not be satisfied with a parliamentary inquiry that cannot focus on individual wrongdoing and can only deal with institutional systems failure. It needs more than just a record and report summary. The potential of an Levenson-style inquiry, as in the United Kingdom, would allow a fully independent and public inquiry to take place. It is regrettable that the Government did not take our advice in this regard.

For a Government that repeatedly expressed a desire to get to the root of issues surrounding the collapse of the banks, it has shown a remarkable level of ineptitude in bringing this about. There is now a real risk that the inquiry timetable will clash with the next general election.

From having being central to the Government's re-election strategy, there is now a real risk that the inquiry will be jettisoned half way though its work in order to facilitate an early election which looks ever more likely. As well as identifying what happened during the banking collapse, deliverable proposals as to how to prevent a recurrence, building on the measures already implemented, could significantly enhance the work of the inquiry.

We know that at some point in the late 1990s and early 2000s a significant cultural shift occurred in the Irish banking sector, which caused some previously prudent institutions to embark on what proved to be a reckless lending spree. Bank of Ireland, for example, took more than 200 years to accumulate €100 billion in lending, yet within another four years it had doubled its amount of loans. The bank loan losses did not simply occur in 2008 - the problem had been in the making for many years, probably as far back as 1999.

Few, if any, bankers put their hand up and voluntarily assumed responsibility for the credit bubble, either to bank shareholders or to the public who ultimately carried the can for the losses.

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