Leo Varadkar (Dublin West, Fine Gael) | Oireachtas source

I welcome the opportunity to speak in the debate this evening and support the proposed terms of reference for the commission of investigation. I welcome it because it is also an opportunity to put some context on how we got this point. As we all know, the Government faced many difficulties when coming into office four years ago, the most serious of which was the perilous state of our public finances and the banking sector following 14 years of misgovernment by Fianna Fáil. That Government left behind a broken economy, a record of growing unemployment, mass emigration and people locked in negative equity, in many cases far from where they envisaged they would spend their lives. The Members opposite speak in outraged terms of loan write-downs and losses on asset sales, without even a hint of acknowledgement there would have been no crisis, no need for bailouts of the banks and no haircuts on the value of loans or losses on the disposal of distressed properties or companies if they had managed the economy properly when they had the opportunity to do so.

I make this point not to be partisan but, rather, to place it in the context of this debate and the forthcoming commission of investigation.

I welcome the proposed commission. There is a need for transparency on the winding down of IBRC. I say this not because I believe anything wrong was done - that is a matter for the commission and I do not want to prejudge the outcome of its deliberations - but because IBRC handled literally billions of euro and the public has a right to an assurance that it acted appropriately. We live in a small country where people's lives and families are interconnected, whether through business, socially or through family. In Ireland, the saying that one is never more than six degrees of separation away from someone can often be reduced to two or three as everyone in Ireland knows somebody who knows someone and, in such a scenario, innuendo and conspiracy theories thrive.

This is all the more reason that we need robust systems of control and oversight. We hear of Chinese walls but in reality transparency is often the best tool for keeping everything above board. Meetings with officials present are better than chats on a golf course or in a Michelin-starred restaurant. Clear, open competitions with properly recorded reasons for decisions taken and a vigorous system of freedom of information help to reassure a justifiably concerned public. It is worth recalling that it was this Government, in particular the Minister for Public Expenditure and Reform, Deputy Brendan Howlin, which restored and enhanced the system of freedom of information, so wilfully weakened and restricted by the previous Government.

It is also essential that we acknowledge the reality of what IBRC was. It was no normal bank but a structure into which two zombie banks, Anglo Irish Bank and Irish Nationwide, were placed. These were banks that had run wild in a banking and regulatory system overseen by many of the Members opposite, some of whom wish to return to this place. Both institutions became synonymous at home and abroad with the reckless management of our banking system. They became emblems of a culture of cronyism that undermined confidence in both our economy and our political system. They became a stain on our international reputation and a dent to our national pride. Peter Nyberg, in his investigation into the causes of our banking crisis, revealed that both institutions had abandoned traditional checks and balances and risk management procedures in the pursuit of even bigger short-term profits. They literally brought the country to its knees in doing so. Some €34.7 billion of borrowed money ended up being pumped into these banks and little of it will be recovered. That, of course, is in stark contrast to the banks recapitalised during the term of office of this Government, namely, AIB, Bank of Ireland and PTSB, from which we have recovered or will recover all the money invested.

People talk about the scandal of €5 million being given to shareholders in Siteserv or the €119 million loss on the transaction. I agree that these things should, as they will, be fully investigated. Let us await the outcome of the commission and not jump to hasty judgments. We do need to let light into the dark recesses of our recent past and further back and this Government has donated much energy to enabling people to have their voices heard and redress provided, whether in the case of child sex abuse, the Magdalen women, the women who underwent symphysiotomy or patients and their families who were not listened to in Portlaoise hospital. We need to ensure that, as we recover from the economic shambles left to us by others, we got the best for distressed assets from the two zombie banks. In making that judgment, we need to acknowledge that in deciding on the sale price the people in IBRC did not have perfect knowledge. They had to make an informed decision based on whatever facts were available and an assessment of the situation at the time, and not one based on the position perhaps two years later. The ability to make perfect judgments based on perfect knowledge and the gift of hindsight only takes place in dreams and movies.

We need to now delve into the detail of what went on in key transactions undertaken by IBRC to ensure the people of Ireland did not lose on the double, first losing the money pumped into Anglo and Nationwide by Fianna Fáil and then, perhaps, not getting back as much from the disposal of assets as we could have. We should, however, also remember what got us into the crisis, which was a total lack of financial management and poor regulatory oversight, years of light-touch regulation and reckless, unsustainable expenditure which ended in the nightmare of huge bank bailouts and a massive budget deficit. We hear now, from the putative Fianna Fáil-Sinn Féin alliance opposite, nothing but plans for more public expenditure and the removal of charges and taxes which would narrow our tax base and potentially plunge our country back into crisis. This debate needs to be open and honest. False outrage from those who caused the crisis or contributed to it by their inadequate oversight is frankly difficult to take and is of no benefit as this commission now commences its work. Fianna Fáil complains about Department of Finance oversight of IBRC but the Department operated under a relationship framework with IBRC put in place by them when they were in Government, a framework which this Government, in particular this Minister for Finance, Deputy Michael Noonan, recognised quickly as being inadequate, replacing it with a tighter and much more robust version.

We need to get to the truth and that truth may well turn out to be stranger than fiction. I suspect that those in IBRC were often faced by almost impossible choices - a "damned if they did, damned if they did not" situation, particularly in the early years of its existence when the international and domestic confidence in the future of the economy was not what it is today and there were only a very small number of people and companies interested in investing in Irish companies and properties, let alone distressed loans or assets. In many cases IBRC was doing little more than selling on ghost estates and half-finished buildings for as much as it could get. In those days, projections of default were much more commonplace than the belief that the economy would recover and take off like a rocket in the way that it has.

I urge everyone to co-operate with the commission as a long, drawn-out process with regular trips down to the law courts will ultimately serve nobody's interests and protect nobody's reputation. I hold no candle for any individual or any institution but everyone has the right to put their position and to have it considered, even if some have not always been willing to grant others that same opportunity.

As a society we need answers and a greater sense of accountability around the events of the recent past. I do not want to intrude on the work or the judgments that may be reached elsewhere but I hope the commission can help in this process and I welcome its establishment.

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