John Paul Phelan (Fine Gael)

I, too, echo Senator Fitzgerald's call for a question and answer session on the commitment the Minister for Finance made on our behalf overnight. While I concur with previous speakers that the measure is necessary, I feel a little sick in the pit of my stomach about the prospect of such wholesale Government intervention. We need to ensure any proposed scheme includes safeguards to protect taxpayers. I concur with Senator O'Toole's comments on insurance cover and the bank levy. The levy was removed several years ago shortly after a former general secretary of the major Government party was appointed head of the Irish Banking Federation. I assume some form of bank levy will be introduced following the Government's initiative.

I watched on the monitor in my office a recent meeting of the Joint Committee on Finance and the Public Service with the heads of five or six large Irish banks. While it is good to have such guests before Oireachtas committees, we should review the manner in which we issue such invitations if they fail to give forthright answers.

Over the summer, we heard a number of proposals from the Department of the Environment, Heritage and Local Government on increasing loans to first-time buyers and other groups with a view to reinvigorating the housing market and house construction sector. Will — as I hope — this morning's announcement scupper these proposals? The best way we can help people who want to provide a house for themselves is to ensure those inflated house prices — in regard to which we are now seeing the chickens come home to roost with our bailing out of the banks — would fall a little further. Rather than the Government intervening again in the housing market, which it did on five or six occasions during the time I have been involved in politics and on each such occasion there was a further increase in house prices, perhaps it could let the market find a natural level.

Having got on to the housing ladder recently, I find it sickening that we are bailing out the banks which threw good money after bad by approving 100% mortgages and recklessly granting loans to developers in this city and across the country to outbid each other for grossly inflated sites, particularly in this city but also in other parts of the country, and now we are asking the taxpayers to bail them out. I know we have to do that, but we should have a proper questions and answers discussion on this matter to ascertain what safeguards are being put in place to ensure that taxpayers gets some sort of value for the potential liability to which they are being exposed.