Alex White (Labour)

An element of honesty might be forthcoming from the Leader in future in regard to the arrangements in this House as well as a little more courtesy to the Opposition leaders and all leaders in the House. In this important debate, it is a pity the Minister for Finance, while I do not criticise him personally, has not had the opportunity to hear the contributions of all of the party leaders in the House. I do not for a moment diminish the importance and contribution of the Minister of State who is present.

Senator Boyle said there should be a degree of honesty in the debate, and he is absolutely right. One of the things we need to do in order to understand where we are at present and where we are going is to understand what has actually happened. Senator Boyle and others used the word "sudden" with regard to this year's downturn. I do not accept the Government and its advisers could not see some changes occurring in the Irish economy in the months, even years, prior to those so-called sudden changes actually occurring. I simply do not believe it. The current Taoiseach and previous Minister for Finance, Deputy Cowen, when he made his Indecon speech only a year ago in November last, stated, "It is wonderful to realise that there is a new generation in Ireland which has never faced the hardship of high levels of unemployment, or the horrors of weekly riots and bombs in Northern Ireland, or the bleak depression of forced emigration." When he made this general introductory remark to this speech, either the Government knew or ought to have known that dramatic changes were coming to the economy, especially in respect of what occurred in the construction sector which even the Government accepts is at least partly responsible for the so-called sudden downturn this year.

Will the Minister of State assist me on this? Does the Government still maintain the position that at the end of 2007 it knew nothing of these impending problems or of the prospects which were to face us in 2008? I do not believe it. I have a high level of trust and confidence in senior civil servants and the senior economic advisers to the Government and the Minister for Finance. The people need a little more candour from the Government as to, in the words of the old movie about President Nixon, "what did the President know and when did he know it". It is not credible to suggest that this suddenly happened in June last and I do not believe it. If we are to have the type of debate that Senator Boyle wants with regard to honesty, we need an answer to this question.

This is a political question because anything to do with the economy is a political question. I have stated in this House previously that there must come a political day of reckoning for all those in the Government, particularly those in Fianna Fáil and the Progressive Democrats, who, from what one can see in terms of their ideas and economic planning and sense of where the economy was going over the past five, six or seven years, thought that all they had to do was simply ensure the property pumps were primed. Practically every tax concession sought from the property sector was granted. It complained about legitimate social measures included in the planning Acts with regard to affordable housing and quickly received concessions. The Government's idea of economic planning was reduced to what it could do for the property sector. Now we are bearing the fruits of this.

If I may say so, Mr. McCreevy is often described as a great genius and one of the architects of our economic success. Apparently he recently stood over stating that when he has money he spends it and when he does not he cannot, or something along these lines. Surely, this is a deeply economically illiterate observation. Part of the role of Government is not only to maintain the economy and keep the books straight but to look to the future of those people to whom the Taoiseach was able to refer to last year as being part of a generation which has never faced the hardships of high rates of unemployment or the bleak depression of forced emigration.

What is in store for a generation of people in their 20s, 30s and beyond who are perhaps the first in many generations to be educated here with the prospect of being able to stay, work and live here? It is not acceptable for this Government to suggest as it does that what happened in the past year was brought into the country by some type of international airborne disease which we have caught as if no agency is associated with Government action and that the Government is simply there to do the books. We have outstanding civil servants who can do the books.

What are politicians for? Where is Mr. Lemass and his legacy in Fianna Fáil? At least in his generation people were urged to look with vision to the future as to how the economy and the country would be in generations to come. We are not getting any of this. The Minister's speech is lamentably lacking any vision for the future of the country. He describes the problem paragraph after paragraph and page after page. We can all describe the problem. Any of us can sit down and write an essay on how bad things are. The reason we sought this debate every day for the past three weeks is that we hoped the Minister would come to the House and set out elements of a vision for the future and elements of a plan. This is not what happened.

What is the point of politics, politicians and Governments elected by the people? It is to bring forward solutions. They may not always be acceptable to the people but suggestions, ideas and a vision should be brought forward. I am not saying that addressing the public finances is not a critical concern. Of course it is. I cannot state it goes without saying but of course it is vital. However, it is only one element of the picture. Even the way the Minister characterises this in his speech is telling:

The first priority remains to bring our finances under control. We must prove to those who have invested here and who are continuing to invest here that we can manage our way out of this severe downturn.

This type of language, that our priority must be to prove to others, portrays this country as if it has no self-confidence. I am sure prospective investors in Ireland look to see how the public finances are managed. I take this for granted and of course it is important. However, it betrays an attitude with a complete lack of a positive approach to why and how we might pull our economy up and plan for the future. It simply characterises it as that we need to behave and to be seen to behave.

A member of my party has recently repeated and canvassed again the proposal we set out in considerable detail. Let no one state the Labour Party has not set out a proposal in detail. By all means scrutinise and criticise it and let us have it as part of the debate. I heard Senator Boyle state that it was Keynesian. When every other country in the world is turning back to Keynesian economics, Senator Boyle spoke in a pejorative sense about us engaging in Keynesian economics because we dare to speak about the necessity of having a stimulus programme in the economy. I understand the Minister of State, Deputy Mansergh, stated on the television that he disagreed with this, and he can clarify this.

This week, the new line from the Government is that we have a stimulus. Last week, we were told we did not need it and that it was wrong, imprudent, not the way forward and that the Labour Party was talking through its hat. This week, we are told we need a stimulus and already have one. Which is it? It is not credible or sustainable for the Government to point to actions it has taken such as the national development plan and the important and welcome investment in public infrastructure in which the Government has been able to engage in recent years and describe it is a stimulus programme. If one looks anywhere else in the world, one sees the point of a stimulus programme as being to add value to what one is doing and ensure one does something new and additional to stimulate and kick-start the economy. To rely on something being done and to try to characterise it as the answer to the question on stimulus is not sustainable.

Senator MacSharry made a point about the Labour Party and the public sector. I agree there is an element of demonisation of the public service in some of the debate in recent weeks. I would be as critical of the Government in this regard because a great deal of double-talk and double-speak comes from the Government. It makes the rhetorical point that it is wrong to attack the public service and that the public service is an important part of our economy. However, in his speech, the Minister spoke about public servants having a protected status and I understand what he means by this. He also stated that changes are required to be made. I have no problem with changes being required or the need to have a responsive public service. Presumably any changes advocated or canvassed by the Minister are changes that ought to have been made prior to this.

Although I am critical of the Government on many issues, I see little evidence that it appointed whole rafts of staff in the public service in recent years who had no job to do, were not required for the delivery of legitimate services and were prepared to stand over waste and overstaffing. Is it a new decision on the part of the Government that change is required in this regard? I would have thought that many of the changes that are now apparently required are ones that should have been made before now. If there is wastage, it should never have occurred, in good times or bad. To invoke the downturn as a reason for such changes is questionable.

I reiterate, as pointed out by many Members, that the OECD report, while not giving the public service what could be described as a clean bill of health, pointed out that despite our economic advances in recent years, we have one of the smallest public services as a proportion of our economy of any of the OECD countries. Therefore, we can conclude that the public service performs relatively well in the context of other challenges facing the economy. I am tempted to say that the one element of the public service that has not performed to par is the Government itself, not the people who serve it so loyally throughout the public sector.

It is not clear what, if any, plan the Government has in regard to the banks. There is much toing and froing. The managers of the banks told us in the summer that there was no problem in regard to their liquidity or capitalisation levels. In the autumn, however, the Tánaiste commented, perhaps in an unguarded moment, that a State guarantee was necessary to save the banks from collapse. I am sure she used words to that effect. I understood that the principal objective of the guarantee was to ensure the continued viability of the banks as a vital motor of the economy, providing loans and credit to customers. However, the dramatic decline in lending has not been arrested.

It is not helpful for Senator O'Toole to say that the banks should not be recapitalised because they will not lend to customers and that we should rely on the guarantee. The guarantee has not achieved the objective of encouraging the banks to resume lending to customers. A commentator in one of today's newspapers makes an interesting point when he queries the recent report which again suggests that there is no difficulty in regard to liquidity or capitalisation in the banks. The Minister for Finance continues to meet management in the banks, which suggests that he is of the view that there is a problem. Are we to believe the report which claims there is no difficulty of liquidity or capitalisation? Other claims have been made in recent months which turned out to be manifestly false. What is the position of the banks and has the Government any plan in this regard?