Dan Boyle (Green Party)

What do we need to point the economy in the right direction when every economic indicator is heading in the wrong direction and it may not be possible to arrest the problem for a considerable period? We need a Government which is honest with the people about the scale of the problems we face and the decisions required to overcome them. We need an Opposition which takes a responsible approach to the most serious economic crisis in the history of the State and avoids the temptation to engage in naked political point scoring, one which suggests procedures and processes conducive to achieving the necessary recovery. We need media which take a rounded approach to reporting the sad, economic story. Notwithstanding the current economic indicators, a constant diet of doom and gloom becomes a self-fulfilling prophesy which precludes economic recovery in the short term. We need to encourage citizens to use their full potential as economic actors, which requires them to be productive in producing, purchasing and consuming goods and services.

The ingredient most lacking in the economy since the end of the Celtic tiger period, however real or otherwise that era was, is confidence. This confidence is required on a number of levels. Yesterday a prominent director of a major financial institution expressed to me his concern that the lack of confidence in Irish financial services arose from a belief there had been a level of corruption in that sector. As a result, Ireland is not regarded as a good country with which to do business. We need to sort out this problem.

I suggest the establishment of an Oireachtas committee on financial services with powers similar to those enjoyed by the Committee of Public Accounts would be a first step towards achieving public and international confidence in our financial services sector. Such a committee could investigate the practices followed in the financial services sector and, in bringing them to the surface, help to eliminate them. The introduction of the bank guarantee scheme and nationalisation of one of our major financial institutions make the Oireachtas the custodian of these institutions and their future behaviour. If we fail to take this action, we will entrench the bad behaviour which has brought about the current problem. As Senator Ross noted, international confidence is an important factor. The absence of confidence is creating a poor perception among members of the public. It is important, therefore, that we also generate confidence among citizens as economic actors. It will be difficult to reverse the current problems for as long as the belief persists we are in a downward economic spiral.

I concur with Senator Ross that we need to avoid a sense of complacency. The State has entered the most difficult economic period in its history. This requires a degree of national cohesion which is not usually sought in political discourse but which will be necessary if the economy is to regain the international respect and trust it enjoyed just a few short months ago. Decisions are being made and further decisions will be reached in the coming days to reflect the immediate need to curb public expenditure by €2 billion. It is clear a mechanism must be found to cut at least half of this sum from the public sector pay bill.

Public service pay which is necessary to run essential public services costs every man, woman and child €5,000 per annum. If people believe this is sustainable, given current revenue from taxation and the level of public expenditure committed and agreed to by the Houses, they do not have a grasp of basic economics. The expenditure and revenue sides of the equation must add up. While it may be uncomfortable for many Members, we have a responsibility to ensure cuts in the cost of running the political system are greater than those we ask other public services to accept as part of an overall package of expenditure reductions.

This period of national crisis should be a time of solidarity. If there is a perception that the Government and members of the political system wish to avoid reducing the overblown and burgeoning costs of the political system while seeking to impose swingeing cuts on many of those who are least capable of sustaining reductions in services, we will have failed as public representatives. I am confident, however, that the package which will emerge in the coming days will bring about a realisation of the seriousness of the position in which we find ourselves and the nature of the decisions we must take. While this package will emerge from consultations with the social partners, the decision making function remains with the Government, in the first instance, and, ultimately, the Houses of the Oireachtas. While we need solidarity and social partnership, the political system must take responsibility on behalf of the people. If we do not do so, we will delay the inevitable, make matters worse and render our objective more difficult to achieve.