Pearse Doherty (Donegal South West, Sinn Fein)
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The debacle at Ulster Bank continues. This morning we heard from the managing director of branch banking at Ulster Bank, Mr. Jim Ryan, who admitted that despite earlier assurances, customers will continue to experience disruption into next week. More than 150,000 people have now been affected by this failure, which is causing enormous difficulties for families, individuals and businesses. We are almost a week into it, yet key questions remain unanswered. I ask the Minister of State to try to answer them today.

First, how did a relatively minor software upgrade lead to such widespread disruption of the bank's payments system? Second, where was the bank's disaster recovery safety net? Experts say the bank should have had a second mainframe operating at a different location, which should have kicked into action when the initial fault arose.

Third, what is to say that this kind of problem will not occur in other banks operating in this State in future? We know that in 2010, the Bank of Ireland experienced problems with its IT system. How do we know that similar system failures being experienced at Ulster Bank are not unique to that bank? Ulster Bank has not answered the questions adequately.

There also seems to have been a very slow response from the Central Bank, the Financial Regulator and the Government in getting answers to these questions. The Government, the regulator and the Ulster Bank management need to answer these questions before an Oireachtas committee. Hopefully, the Minister of State can shed some light on this matter for us and, more importantly, for the 150,000 people who have been affected by this problem so far. There are hundreds of thousands of customers with other banks in this State who are worried it could potentially affect them also.

Michael McGrath (Cork South Central, Fianna Fail)
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I also welcome the opportunity to raise this issue. One of the most disappointing aspects for customers who have been affected is that the goalposts seem to keep changing as to when this crisis will be resolved. It was initially meant to be Monday this week, then it was to be fully resolved by the beginning of next week, yet there seems to have been a change in that position as well. We are now being told that the majority of accounts will be updated by next week.

It is disturbing, to say the least, that the disaster recovery plan the bank is obliged to have in place, as all banks are, clearly did not work in this case. It raises some fundamental issues. The Central Bank was asleep for the first few days of this crisis. This first emerged on Tuesday evening last week but there was no statement from the Central Bank until Sunday. The Cental Bank then updated its statement on Monday of this week. We have not heard enough from the Central Bank and do not know exactly what it is doing.

The absolute priority is, of course, for Ulster Bank to get its systems up to date and for normal services to resume for its customers. I acknowledge and praise the work of ordinary branch staff around the country who are accommodating customers under very difficult circumstances. What we need is a comprehensive investigation by the Central Bank into what happened, how it is being handled and the systems in place at Ulster Bank. Also, the Central Bank should rigorously test the contingency plans of all banks providing services to Irish customers. This needs to be done. It is not enough for the Central Bank to ask the banks to review their systems. The Central Bank, as the regulator and consumer watchdog, needs to rigorously test all of the systems in the banks here. We cannot afford something like this happening again.

Shane McEntee (Meath East, Fine Gael)
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Deputies Doherty and Michael McGrath have made relevant points. I always believed something like this would happen. Banks no longer provider a personal service: everything has been computerised. As stated by the Deputies, there is no doubt but that this could happen again. I agree with them that we should call in the relevant people to explain what happened and that many people are under pressure owing to the slowness of the bank to address the problem. While I cannot respond to all of the Deputies' questions now, I will ensure they are responded to in a written reply. This was bound to happen at some stage. Perhaps now the banks will return to employing counter staff rather than relying on computers.

This issue has been ongoing since last week and must be resolved as a matter of priority. Ulster Bank, as part of the RBS group, last week experienced severe technical problems triggered by a software update late on Tuesday 19 June, which caused the RBS group's computer system to fail. As a result, payments going into and out of accounts overnight were not processed, causing a huge backlog across RBS and NatWest branches and subsidiaries, including Ulster Bank. The outage also created some technical instability in the system which exacerbated the problem and caused further delays. An initial attempt to provide a "patch" to the system last Thursday, 21 June failed. This amplified the backlog issue and led to further delays across the Ulster Bank system.

The EMC met separately with Ulster Bank to discuss its current problems. Ulster Bank's chief executive assured the EMC that resolution of this problem is its top priority. He also set out the measures that the bank is taking to assist customers, including the extension of bank opening hours to assist customers to transact their business; the addition of 100 staff to their telephone assistance lines; increased discretion of branch managers to pay out funds to customers so as to ensure they have access to pay and social welfare and the transfer of temporary additional staff from RBS Group in the UK to Ireland to assist in clearing the backlog.

The Minister for Finance, the Department of Finance and the Central Bank are receiving regular status updates from Ulster Bank. Management at Ulster Bank have stated that no customer, including customers of other banks, will be out of pocket as a result of this issue. We know that they will keep to their word and ensure that this will be the case for all Irish customers. We will hold them to that. Once its systems are up and running, the bank will commence the process of refunding customers any interest, fees or charges that have occurred as a result of this incident.

The Minister, Deputy Burton, has obtained assurances from Ulster Bank that it is taking measures to minimise the impact on customers who have been experiencing delays in receiving their social welfare and other payments from the bank. We expect Ulster Bank to ensure that the impact of delays for elderly or more vulnerable customers is addressed and that flexible arrangements are guaranteed by it during this period.

The basic systems failure has now being rectified. However, there is still a considerable backlog which the Ulster Bank needs to remedy. We have been told this work will continue around the clock until this weekend. Ulster Bank, as part of the RBS group, operates on a commercial basis, at arm's length from the State but where systemic failures occur there are steps that need to be taken by the institution to ensure they are not repeated. Obviously, there are issues around its IT infrastructure. I note that the Governor of the Bank of England, Mr. Mervyn King, has suggested that the FSA should investigate the cause of the system failure at RBS.

For members of the public specifically, the technical problems led to what the Ulster Bank management have accepted as "unacceptable delays" in relation to three core functions, namely, payroll processing, branch batch payments and payment of direct debits and credits. Ulster Bank intends to have the payroll processing rectified by today and has secured support from AIB on batch processing. The bank will continue its work on the issue of direct debits and credits throughout the next few days. Ulster Bank ATMs remain available for use. We expect the backlogs to be cleared as soon as possible to ensure that Ulster Bank customers and other affected customers have correct balances in their accounts. Other Irish banks have sought to provide technical support to Ulster Bank while it works through this process to minimise the effects across the Irish banking system. We are glad that this has largely been achieved. The Central Bank is in constant touch with Ulster Bank. Management at Ulster Bank have been told to ensure that there are sufficient levels of information and constant communication with their customers and the public.

We sympathise with the disruption to Ulster Bank customers and appreciate the efforts of staff at the bank in terms of trying to support customers. However, we expect a rapid rectification of this situation and an assurance that the IT issues will be comprehensively addressed.

Pearse Doherty (Donegal South West, Sinn Fein)
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I welcome that the Minister of State has undertaken to ensure we receive a written response to any of the questions he cannot respond to today. The Minister of State referred in his reply to the call by the Governor of the Bank of England for an investigation into this matter. There has been no call by our Financial Regulator, which regulates Ulster Bank in this State, for any investigation. Where a problem occurs in a bank, be it hiding of losses in terms of its capital or an IT failure, it is already too late. We have structures in place to ensure this does not happen.

Is the Minister of State satisfied that the Financial Regulator was robust enough in terms of ensuring emergency contingency plans were in place at Ulster bank? Is he satisfied that other banks in this State, of which the majority of people in this state are customers, have contingency plans in place? Ulster Bank assurances aside, what does the Government propose to do in this regard? The Minister of State said he hoped the banks would return to employing counter staff rather than relying on IT systems. That, unfortunately, is not what is going to happen. We all know that the banks will soon lay off thousands of people. IT managers in the banks are working overtime to devise automated systems. This is an issue of huge importance in terms of customer relations into the future and confidence in our banking system.

Michael McGrath (Cork South Central, Fianna Fail)
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The Minister of State alluded in his remarks to the thousands of Ulster Bank customers whose social welfare payments and monthly salaries are due to be paid into their accounts this week. It is critical these people are reassured that they will have access to their money. Not everyone has the benefit of an Ulster Bank branch around the corner from them. This affair has caused enormous distress and inconvenience for many people. It is not sufficient to say that people will not be out of pocket. We need an assurance that there will be no black mark recorded on the credit history of people whose mortgage or loan repayments were missed through no fault of theirs. People in the UK are already having difficulty having their record corrected. We need to ensure there is no such consequence here.

I again call on the Central Bank to undertake a thorough investigation into this matter. While it may have originated in the RBS Group and outside of our jurisdiction it is affecting Irish customers and Irish banks. The Central Bank needs to thoroughly investigate this matter and to rigorously stress test the contingency plans in place in all Irish banks. This could happen again.

Shane McEntee (Meath East, Fine Gael)
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As stated, this could happen in any bank. It has happened once and could happen again. It is crucial that the relevant bodies are brought before us to explain what went wrong. If this were to happen again the whole country could be brought to a standstill. Deputy Michael McGrath referred to the person who may apply for a car loan in six or 12 months time only to find a black mark recorded against him or her. We must call in the relevant people from the Central Bank and other banks to ensure this does not happen. This matter will be forgotten about in six months time. It is important then that this matter is addressed prior to the recess. This could happen in any bank. I always knew it would happen at some stage. In my view, technology has gone too far. This is a warning, at great cost to many people. I agree with Deputies' comments on the matter, including that a person who applies for a car loan in six months time may be refused it because of this, which refusal will be communicated to the local branch manager who no longer has any say in that regard.