Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

I acknowledge that the amendments the Minister for Finance, Deputy Michael McGrath, spoke of and his Department is bringing forward are technical and seek to address drafting issues in the latest version of the Bill. As the Bill reaches its Final Stage in the Dáil, it is appropriate to briefly comment on its provisions. We have waited a very long time, far too long, for the introduction of this legislation. Every customer has the right to be treated fairly and have his or her interests upheld. At a minimum, customers should have a guarantee that they will be protected from gross misconduct, unethical behaviour and corporate mismanagement. Where such injustice or misconduct occurs, the individuals who are accountable should be held to account. This has not happened. As we know all too well, customers in banking and financial services have not been afforded the protection of being confident that individuals will be held to account when they fall victim to mistreatment, mismanagement, overcharging or any of the other scandals we have experienced relating to financial institutions.

More than a decade has passed since the Irish banking sector plunged our economy into crisis. It is truly shocking that we are only now reaching the final stages of this legislation that will allow senior bank and financial services executives to be held to account for their failures. We have witnessed the tracker mortgage scandal which left more than 40,000 customers overcharged, with many losing their family homes.

Public trust in the banking sector can only be restored when the culture at the heart of our banks changes. This can only happen by ensuring that individuals are held to account for failures when they occur. An individual accountability regime was introduced in Britain in 2016, seven years ago, in the form of the senior management and certification regime, and in Australia in 2016, six years ago, with the introduction of the banking executive accountability regime. In January 2017, six years ago, Sinn Féin successfully brought a motion before the Dáil calling for legislation that would ensure individuals in financial institutions could be held to account. The following year, in July 2018, the Central Bank published its report on the behaviour and culture of Irish retail banks on foot of the tracker mortgage scandal. Among its recommendations was for legislation to introduce a new individual accountability framework, including the new conduct standards for the senior executive accountability regime, and enhancements to the fitness and probity regime and the enforcement process. These recommendations were to ensure senior bankers would be held to account for their actions. We have been considering this legislation for four years since the Central Bank's report was published. This is an indictment of the lack of priority the Government have attached to this issue.

That the legislation is finally before us is to be welcomed and today is a welcome day. The Bill grants regulation-making powers to the Central Bank to effectively implement the individual accountability framework in respect of senior executives in regulated financial service providers. It sets out four key pillars to the individual accountability framework. These are the new senior executive accountability regime; the new conduct standards for regulated financial service providers and their management and staff; enhancements to the Central Bank's fitness and probity regime; and stronger enforcement capabilities of the Central Bank.

The senior executive accountability regime, or SEAR as it is commonly known, will be introduced mainly by amendments to the Central Bank Act of 2013. This Bill provides regulation-making power to the Central Bank, with the bank to set out the details of allocated responsibilities and requirements regarding management responsibility maps and statements of responsibility. The Bill does not set out the sectors to be included in SEAR. These will be set out in the Central Bank regulations, although it is intended that the SEAR will initially apply to banks, insurers and certain investment firms. We will await the sectors to be included under the regulations but we in Sinn Féin hope they will be expansive. We are aware that in Australia, for example, plans are under way to extend the country's banking executive accountability regime to other financial services entities following recommendations from the Hayne royal commission. Similarly, it will be important to ensure the scope of these regulations is kept under constant review.

I raised a number of issues with the former Minister for Finance, Deputy Paschal Donohoe, on Committee Stage. These include the training that will be needed by firms to ensure those responsibilities they have under this legislation can be implemented in line with the requirements. We also discussed the choice of six years as the length of time an individual can remain subject to a Central Bank investigation after leaving a role. I raised the point that many issues often do not come to light within such a timeframe and noted that this could pose a problem for ensuring accountability after the fact. I received a commitment from the former Minister for Finance that the Department would consider this issue. I ask the new Minister for Finance to do the same.

I also raised issues with section 15 and the discontinuation of an investigation for reasons of lack of resources. It would not be acceptable to have this written into legislation in relation to a Garda investigation and I see little reason for it to be acceptable in this instance. Again, I ask that the Minister consider this provision.

While the Bill is very welcome, it is long overdue. Regulators and the public have waited far too long for this legislation that will finally enable the regulator to hold senior bankers to account. Those subject to untold and significant harms at the hands of our banking sector have had to suffer, while those responsible have gone unnamed and unpunished. That should never be allowed to happen. It should not have happened in the past and it definitely should not happen in the future.

We look forward to the regulations that will flow from this legislation. We also look forward to engaging with the Central Bank of Ireland on those regulations and ensuring this legislation enables the Central Bank to deliver what is so desperately needed, namely, accountability. It is crucial that we make sure this legislation is fit for purpose, not just today but in the months and years ahead. We need to be nimble on our feet and quick to respond if there are instances in this legislation where we can see that others are able to skite around.

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