Michael McNamara (Clare, Labour) | Oireachtas source

To pick up where Deputy Barry left off, with the Strategic Banking Corporation of Ireland, the Government counter-motion stresses the fact the Government has no statutory role in setting interest rates. I believe this was stressed by the Minister last night, and I am sorry I was not present to hear him speak. Nor does the Minister really have any role with regard to the interest rates set by banks which avail of the SBCI.

The SBCI was effectively set up to get money to develop SMEs and the wider economy after a period of considerable decline and stagnation and, of course, the SBCI set up long-term funding agreements with the European Investment Bank, with KfW, the German state promotion bank, and with the Ireland Strategic Investment Fund. The result of that has been very little. I have had communication from constituents who, through all of that period, were wondering where they could get funding, and I had told them the Government was going to set this up and that I was led to believe it would be great. Today, I was told by one of those people that they were being offered an interest rate of 6.25% by Bank of Ireland. Therefore, for all of the Government's efforts and all of the cheap money the Government is getting and giving to Bank of Ireland, that is being passed on at just 0.25% less than normal. This is not only notwithstanding all of the cheap funding but also notwithstanding all of the security that comes with lending through this scheme.

Richie Boucher came to the finance committee while I was there and made it quite clear what he thought about the elected representatives in this place. I do not know what more he could have done to express his disdain. Likewise, AIB is propped up by the State and is a failed banking institution to all intents and purposes. Another constituent runs a small business employing over 100 people in my constituency. In that case, the bank is not seeking to re-establish non-performing loans but to re-establish performing loans so it can get a better interest rate than the rate it agreed. This business, which employs over 100 people, is now being threatened with the putting in of a receiver to protect the bank's assets.

There is no threat to the business whatsoever, but if it puts in a receiver there will be an immediate threat because people who do business with the enterprise will think they should not give it money or extend it credit. To a certain extent, the Government has had successes, but they have not revolved around tackling the banking sector.

That said, I have not heard too many solutions. The solutions contained in the Government amendment are pretty much the same as those proposed by Deputy Michael McGrath, although they have been cut, pasted and rejigged because we could not possibly acknowledge that he had a point. I thank him for tabling the motion, because we all know that after every election there is a monopoly of wisdom on this side of the House, which remains there until the next election.

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