Enda Kenny (Mayo, Fine Gael)
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Many people watching the proceedings of this House are worried about the future of their jobs, the value of their homes and the difficulties that lie ahead. While our views on how to restore confidence in this country's economic strategy may differ, we all want the country to be able to move forward. Fine Gael has consistently outlined its constructive views to the Government. The least people expect in this forum is some sense of mutual respect. Those whose ideas differ from one's own deserve to be respected. The Taoiseach's outburst yesterday did little to build confidence among people outside this House, including people overseas. If he is serious about building a national consensus on the recovery of the economy, he should have a rational respect for the views of other Members of the House. It may well be that he wants to run the Government his way. There has been evidence of that over the last six or seven months. It was the Taoiseach's way to introduce the budget in October. It was his way to say that the Estimates he had produced were on target — they were off target by €2 billion in one month before Christmas. It was his way to intend to take medical cards from elderly people. It was his way to attempt to withdraw an allowance from those who are intellectually challenged. That was his way.

As this country faces a war for economic survival — the clock is ticking for Ireland — no cohesive strategy or plan has been produced by the Government. If the Taoiseach was running this country as a company, with the population of Ireland as its workers, and he was borrowing to pay interest, we would be out of business. If that is his way, I disagree fundamentally with him. It is time for the Government to examine the reality of the situation we are in. Some 60,000 jobs have been lost since I first called for the introduction of a programme of recapitalisation. The Taoiseach said it was not necessary — that was his way at the time. When I suggested that Anglo Irish Bank should be taken over, the Taoiseach said it should not be. When I said it should not be included in the recapitalisation programme, the Taoiseach said it would be business as usual. The Taoiseach's way is not working and has not worked. I suggest it is about time that the Taoiseach, in his capacity as leader of the Government, ensures that it stops dancing to the tune of developers and big bankers.

Deputies:

Hear, hear.

John Cregan (Limerick West, Fianna Fail)
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Rubbish.

Enda Kenny (Mayo, Fine Gael)
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The Taoiseach should set out a strategy now. He should outline in this House how he intends to ensure that banks make credit lines available to small businesses, in the interests of creating and protecting jobs in this country. Will the Taoiseach respond to that? What has he done? What is he doing? Can he confirm the extent of the credit lines that are open to small and medium sized enterprises at this time of national crisis? We will play our part, but the Taoiseach needs to shape up by playing his part.

Pádraic McCormack (Galway West, Fine Gael)
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He will sing it his way.

Brian Cowen (Laois-Offaly, Fianna Fail)
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We have heard the usual outburst from Deputy Kenny.

Bernard Durkan (Kildare North, Fine Gael)
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Yes.

Brian Cowen (Laois-Offaly, Fianna Fail)
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He is looking for the high ground.

Paul Kehoe (Wexford, Fine Gael)
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The Taoiseach should listen to him.

Brian Cowen (Laois-Offaly, Fianna Fail)
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We have also had——

John O'Donoghue (Kerry South, Ceann Comhairle)
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The Taoiseach has to be listened to.

Brian Cowen (Laois-Offaly, Fianna Fail)
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The catcalling and heckling started before I opened my mouth.

Bernard Durkan (Kildare North, Fine Gael)
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This is more of the same.

Paul Connaughton Snr (Galway East, Fine Gael)
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The Taoiseach knows what is coming.

Brian Cowen (Laois-Offaly, Fianna Fail)
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My job is to set out the Government's position on all these issues.

Jim O'Keeffe (Cork South West, Fine Gael)
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Why is the Taoiseach not doing that?

Brian Cowen (Laois-Offaly, Fianna Fail)
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I remind Deputy Kenny that bringing stability to the banking system continues to be one of the Government's top priorities. This issue is being dealt with by every government in the world that is concerned with the difficulties being faced in the global financial system.

Pádraic McCormack (Galway West, Fine Gael)
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What about the national element of it?

John Cregan (Limerick West, Fianna Fail)
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Go back to sleep.

Bernard Durkan (Kildare North, Fine Gael)
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The Government should start with our national financial system.

Brian Cowen (Laois-Offaly, Fianna Fail)
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Deputy Kenny mentioned that he called for recapitalisation when that approach was being taken in the UK. At that time, I made the point, which I emphasise again today, that the Irish banking system has not suffered from the sub-prime mortgage problem that has been a significant feature of the British banking system. The British authorities had to take immediate steps to recapitalise the banks in that country because they needed to mark the market in many of those assets. That was not the situation in the Irish system. The guarantee scheme we introduced provided the stability that was necessary. It was an important and decisive act on our part. Subsequently, we took the time to get the necessary advice on how to proceed with recapitalisation policy issues. Since then, market sentiment has been quite negative to banking, in general. All banking shares have decreased in value. Irish banking shares, in particular, have dipped more than others. We are aware that governance issues have arisen in respect of one particular financial institution, with the consequence of further negativing market sentiment in respect of other institutions. The Government, including the Minister for Finance and I, continue to accord top priority to this issue in the interests of maintaining a stable financial system in Ireland. It is important that all of us, in our comments, make the point that we are interested in ensuring that the Irish financial system operates and functions. That is a prerequisite for a properly functioning market economy in this country, even in the difficult times in which we are operating.

I reject with the contempt it deserves the continuing suggestion that we are motivated by anything other than the public good in trying to bring stability to the financial system in this country.

Deputies:

Hear, hear.

Brian Cowen (Laois-Offaly, Fianna Fail)
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While I do not expect that this sort of behaviour will end on the Deputy's part, I reject it with the contempt it deserves.

Bernard Durkan (Kildare North, Fine Gael)
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What about the Government's performance in recent years? Will the Taoiseach put that question to the people?

John O'Donoghue (Kerry South, Ceann Comhairle)
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The Taoiseach should be allowed to speak without interruption.

Brian Cowen (Laois-Offaly, Fianna Fail)
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In regard to small and medium sized enterprises and first-time buyers, we have indicated the need to ensure there is access to credit lines. This is something in which we are engaged. The availability of mortgage support and mortgage finance is increasing by 30% over last year and by 10% for medium sized enterprises in respect of access to credit lines. The independent directors we have appointed in the public interest are ensuring this policy is brought forward and that the strategic plans for the banks as they proceed with the recapitalisation will keep all of that in mind. Fundamentally, we must ensure market sentiment towards the Irish banking system is more positive so that shares can rise and people in the investment community can see that the Irish banking system is solvent, is functioning and has a clear future as part of the economic renewal and revival we are trying to organise. These are my responses to the issues raised by Deputy Kenny which are relevant to the debate.

Enda Kenny (Mayo, Fine Gael)
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The problem is about building trust and confidence. There is no trust in the banks, nor is there the degree of confidence there should be. International markets look at the country and the banks in the same way, and there is trust in neither at the moment. Confidence is critical to this. The Taoiseach says he is engaged in the business of seeing that credit flows to small businesses. Will he publish the information he has to date so that we can see the extent of that credit flow? Anybody I speak to, whether those involved in the business of this House or in small businesses, tells me that the lines have tightened so much that it is becoming very restrictive.

One of the problems is that the banks have all the information. There is no real confidence or trust between the National Treasury Management Agency, the Department of Finance and the banks. I have a suggestion for the Taoiseach. What he could do is make an appointment of somebody within the regulatory authority who would direct that the banks strip out their commercial from their residential and other loans and do an analysis on every bank of the numbers of persons who are unable to repay their mortgages and the numbers of small businesses now in distress. This information is available to the banks but they will not publish it. They should give it to the Taoiseach.

The Minister for Finance has said we are now deeply embedded in the banking sector. Confidence is at its lowest ebb. The Taoiseach could have that information in a week and could then put together a package to say to the 80,000, 100,000 or 150,000 mortgage holders who have lost their jobs, are on three-day weeks or face redundancy that we are now in position to know the scale of the picture and to do something in respect of focusing the banks on restructuring those mortgages or putting into effect a number of options to ease the burden upon those people who will not then be faced with foreclosure. In a similar sense with the commercial entities, we would then have a clear picture of the number of small and medium enterprises in serious distress. We could then at least decide what best to do in their interest. I am interested, as I am sure is the Taoiseach, that those people should be able to hold onto their jobs, protect those jobs and that we should be able to build on that through a series of mechanisms.

Will the Taoiseach do this in respect of the banks? We now own a bank whose liabilities we are unaware of, and we are being asked to continue that. I have offered a constructive suggestion that would give the Taoiseach and everybody else a clear picture of what the banks face and what those mortgage holders who cannot make their repayments now face. That would be in everybody's interests and I ask the Taoiseach to respond. A book the Taoiseach should consider for his spare time reading is by Robert Goffee and Gareth Jones and is entitled Why Should Anyone be Led by You?.

Brian Cowen (Laois-Offaly, Fianna Fail)
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I do not know who writes Deputy Kenny's quips but I hope he can get somebody to improve them.

Pádraic McCormack (Galway West, Fine Gael)
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The Taoiseach brought it on himself, by singing.

Brian Cowen (Laois-Offaly, Fianna Fail)
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In regard to mortgage issues, it is important to point out that the information up to June was that there were some 127 repossession orders out of the total of 1 million mortgages. Thankfully, thus far — this issue is being monitored on an ongoing basis — the number of mortgages in stress is much lower when compared with the situation in the United Kingdom. This is an issue we must continue to watch closely.

It is important to point out that the Financial Regulator is developing a statutory code of practice in respect of this issue. There is a good record in this respect for those who make contact early with financial institutions regarding any issue of difficulty concerning repayment capacity. The banks will work with customers in a way that is in the interests of everybody to ensure they get over the particularly difficult times they may be facing. It is important to point out that whereas this is a problem which has the potential to increase, it should not be exaggerated to a level of distress above what we know to be the situation based on data available up to June. The second six months of last year will see further developments in this regard. We are monitoring that situation very closely.

Eamon Gilmore (Dún Laoghaire, Labour)
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On 18 December 2008, several hours after the Dáil went into recess for Christmas, Mr. Seán FitzPatrick announced his intention to resign as chairman of Anglo Irish Bank following the disclosure that he had taken out loans of €87 million which, by shifting them periodically to another institution, he was able to conceal from the bank's shareholders over a period of eight years. We have subsequently found out that the total loans he had amounted to €129 million, an astonishing amount of money in any circumstances.

Mr. FitzPatrick says that what he did was inappropriate but that he did not break any law. The Minister for Finance, in his initial comment, expressed disappointment at what Mr. FitzPatrick had done. The Taoiseach will appreciate that the feeling among the public is somewhat stronger than that. Shareholders in Anglo Irish Bank, many of them pensioners, whose savings have been lost, staff of the bank, people who have loans, sometimes for small amounts, and are being followed quite strongly by the banks to pay them back, people who have lost their jobs because of the difficulties in the economy to which the crisis in banking has contributed, and the other banks in which international confidence has declined and which are having difficulty raising money on international financial markets — these people would feel somewhat more strongly about the damage that has been caused by the actions of Mr. FitzPatrick and perhaps others in Anglo Irish Bank.

The Taoiseach has said that problems in banking and the economy are happening in other countries worldwide. However, we see in other countries that wrongdoing is outed and illegality is punished. We see that people who have engaged in wrongful activities or are accused of illegal activities are arrested and, in some cases, are in custody awaiting trial. Members will recall the case of Martha Stewart who served time in jail for what would be regarded here as a relatively minor offence.

The Labour Party, through Deputy Burton, proposed here last week when we were dealing with the nationalisation of Anglo Irish Bank that a High Court inspector should be appointed to investigate what happened in the bank and in particular the activities of Mr. FitzPatrick. The Taoiseach's Government voted down that proposal. What I want to ask the Taoiseach today is if he can tell the House and the public what investigations are under way into what happened in Anglo Irish Bank. Who is conducting the investigations and when will the public find out the truth about what has happened in Anglo Irish Bank, who was involved in it, if there were illegal actions and if laws were broken? I find it difficult to believe and to understand that laws were not broken. The Companies Act is quite specific and clear that full information is to be made available and that directors have responsibilities to make full information available on their companies' affairs and accounts to their shareholders. I find it difficult to understand how laws were not broken. What I want to establish from the Taoiseach today, and I do not want to do it in any prejudicial way, is what investigations, if any, are under way into what went on in Anglo Irish Bank and the activities of Mr. FitzPatrick and others.

Brian Cowen (Laois-Offaly, Fianna Fail)
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The Deputy will be aware there are well established mechanisms to establish the full picture of what went wrong in the bank. The Financial Regulator is carrying out its own investigation and I understand will report back to a committee of this House on the matter. The Director of Corporate Enforcement is also investigating behaviour in the bank. Those two mechanisms available to us are what is going on in regard to the bank at present. When they have completed their inquiries, they will report as quickly as possible on them. On the question of the appointment of a High Court examiner, in the interests of maintaining confidence in the institution it will continue to operate as a going concern, but the Office of the Director of Corporate Enforcement and the Financial Regulator's office are conducting inquiries at present.

Eamon Gilmore (Dún Laoghaire, Labour)
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All that reply tells me is that it seems this Government is soft on corporate crime. The matter of the Financial Regulator investigating this matter is a joke in the present circumstances. The Financial Regulator has 380 staff and it was getting quarterly reports apparently about these loans, which included, we were told, information about the loans that Mr. FitzPatrick had taken out, and it could not spot what was going on. The idea of the Financial Regulator investigating this matter does not fill me with any confidence. I have more confidence in the Director of Corporate Enforcement investigating it and he has the power, as I understand it, to apply for the appointment of a High Court inspector. To my knowledge, no such application has been made. Neither have we heard about any Garda investigation or any other type of investigation. The Taoiseach will have to do better in terms of reassuring the public that this matter is being treated seriously and being seriously investigated.

I have not seen or heard anything that convinces me or conveys to me that a serious investigation is being undertaken into what happened here. It is not acceptable that the people involved in this can simply walk off into the sunset without being called to account for what happened here. Everybody knows that Anglo Irish Bank was at the heart of the banking crisis that caused the Taoiseach to introduce legislation here in September to provide a blanket guarantee. We know that banking crisis is at the heart of the economic difficulty now facing this country where people are losing jobs and businesses are going to the wall. If there has been wrongdoing and crimes committed in respect of the conduct of the banking business of that bank, it must be investigated, identified and prosecuted. The kind of soft glove treatment the Taoiseach appears to be giving to it is not good enough.

There have been reports in newspapers during the last two days, particularly in respect of Anglo, what was made known to the Financial Regulator and what was conveyed to the Department of Finance. We were told from a report in one newspaper at least that the current Minister for Finance was briefed on the position in Anglo Irish Bank when he took up office.

Bernard Durkan (Kildare North, Fine Gael)
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Correct.

Eamon Gilmore (Dún Laoghaire, Labour)
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We are told in another newspaper today that information in relation to some of the activities in Anglo Irish Bank were made known to the Department of Finance at as the beginning of last year.

Bernard Durkan (Kildare North, Fine Gael)
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Correct.

Eamon Gilmore (Dún Laoghaire, Labour)
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The Taoiseach was the Minister for Finance at that time. What did he know about what was going on in Anglo Irish Bank when he was Minister for Finance? Did he know about these loans Mr. FitzPatrick had taken out? What did the Financial Regulator bring to his attention while he was Minister for Finance about what was happening in Anglo Irish Bank?

Brian Cowen (Laois-Offaly, Fianna Fail)
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First, I say to Deputy Gilmore that I reject again the assertion made forcefully by him this morning that the Government will in some way ensure that the rigours of the law or the full mechanisms that are available for investigation will not be applied or applied independently, respecting the independence of those offices. I reject that. They will be applied. I have confidence in the Office of the Director of Corporate Enforcement. He is the person undertaking the investigation. We have ensured it is an independent power of the Director of Corporate Enforcement to decide whether an examiner or any person be appointed by the High Court. That is a matter for the Director of Corporate Enforcement independently of any political direction or control and rightly so. The suggestion, therefore, made by the Deputy that something less is being done than should be done is not correct. One either accepts the integrity of the people who hold these offices or one does not. I happen to accept their integrity. I have heard them praised in other contexts for work they have done in other areas in the past, but obviously the political opportunity to suggest otherwise——

Eamon Gilmore (Dún Laoghaire, Labour)
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I did not suggest otherwise.

Deputies:

The Deputy did.

John O'Donoghue (Kerry South, Ceann Comhairle)
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Allow the Taoiseach to continue without interruption.

Eamon Gilmore (Dún Laoghaire, Labour)
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I said I had confidence in the Director of Corporate Enforcement.

Brian Cowen (Laois-Offaly, Fianna Fail)
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The political opportunity to suggest otherwise is something that could not be passed this morning.

Charles Flanagan (Laois-Offaly, Fine Gael)
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It is a smoke screen.

Brian Cowen (Laois-Offaly, Fianna Fail)
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I also have confidence in the new chairman of the bank. I have confidence in the integrity of those who were appointed in the public interest by the Government as directors of the bank——

Brendan Howlin (Wexford, Labour)
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It is a case of business as usual.

Brian Cowen (Laois-Offaly, Fianna Fail)
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——including Frank Daly, a former chairman of the Revenue Commissioners, Mr. Alan Dukes, a former Minister for Finance——

Joan Burton (Dublin West, Labour)
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We are asking about the Taoiseach, not about them.

Brian Cowen (Laois-Offaly, Fianna Fail)
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——and Mr. Maurice Keane. I have confidence in those people in terms of their commitment to proper corporate governance in the bank. I want to make that clear.

Deputies:

The Taoiseach should read last Sunday's newspapers.

Brian Cowen (Laois-Offaly, Fianna Fail)
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In regard to the other matter Deputy Gilmore raised, the Minister was aware from contacts between the Department of Finance and the Financial Regulator over the course of last year that a large overhang of shares as held by a particular investor and related persons, that this was considered by the bank and the market to be a source of instability and that the institution was seeking some resolution of this issue. The details of this were a matter for the institution and, as appropriate, the Financial Regulator.

To answer specifically the question the Deputy asked, I am not aware of any directors' loans, the content of them, the context for them or in what respect they are held — not at all. I am not involved in that area whatsoever——

Joan Burton (Dublin West, Labour)
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When the Taoiseach went to guarantee the banks, did he not even look into that?

Brian Cowen (Laois-Offaly, Fianna Fail)
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——either as Minister or as Taoiseach.

Joan Burton (Dublin West, Labour)
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When the Taoiseach went to guarantee the banks and risk our whole financial structure, did he not even check that?

Brian Cowen (Laois-Offaly, Fianna Fail)
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Excuse me Deputy——

Billy Kelleher (Cork North Central, Fianna Fail)
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The Deputies opposite sat on their hands.

Brian Cowen (Laois-Offaly, Fianna Fail)
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——a specific question has been asked and I want to clear any doubt about the matter.

As a result of the due diligence process recently undertaken on behalf of the Minister, certain matters in connection with transactions involving the Quinn stake in the bank came to the attention of the Minister which may warrant further investigation by the Financial Regulator. Anglo Irish Bank has now been taken into public ownership. Various matters are being considered by the Financial Regulator as I have said, the Office of the Director of Corporate Enforcement and the bank, under its new chairman. The House can take it that any significant corporate governance issue that comes to light will be investigated by the appropriate authorities.

Joan Burton (Dublin West, Labour)
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That comes to light — will the Taoiseach bring it to light?

John O'Donoghue (Kerry South, Ceann Comhairle)
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That concludes Leaders' Questions.