Shane Ross (Independent)

About 18 months ago, Senator Cassidy told us to buy property. While I do not know what would have been the results of any such investment, I doubt if Senator Butler is in the right place to offer similar advice.

I welcome the Minister of State to the House. His speech amounted to a statement by the Government that it is waving a white flag. It is an appalling document which demonstrates an appalling surrender. I cannot believe negotiations have taken place. The Government has offered, with some conditions attached, €7 billion to people who have behaved appallingly and in some cases unethically. Much more remains to be revealed in this regard. It appears all these conditions melted away during the negotiations.

This entire process involved, on one side, a Government with good motivations rescuing the banks because the economy needs them, albeit not the banks in question, and, on the other side, a group of clowns who have disgraced themselves over many years negotiating one thing alone, as is clear from the document, namely, how to save their jobs. From the point of view of the bankers, the negotiations were about nothing else. What happened? Not only did the bankers save their jobs but the concessions they gave are comical and laughable. According to the document before us, the Government gained virtually no concessions. I cannot understand the reason it did not get what it wanted. Despite holding all the cards, weapons and money, it has emerged from the process almost empty-handed.

The Minister of State's speech was devastatingly weak on the important issues. I presume his words about the "flow of credit to the wider economy" refer to lending to small businesses. He stated "the recapitalised banks have agreed to fund and co-operate with an independent review of credit availability which will be managed jointly by the banks, Government and business representatives". Why on earth do we need an independent review? The Minister of State added that the banks have also agreed to work closely with the IDA, Enterprise Ireland and State agencies. This is not a concession. How dare the banks even consider not doing this? He also noted that they have agreed to provide €15 million each to a new seed capital fund. This is a laughable amount of money which, in banking terms, amounts to very little.

Will the banks somehow save small business? A completely mistaken impression is abroad, one which has been deliberately given by the Government, that this money will somehow help small business. Not a penny of the €7 billion will go into small business and it is about time people were told the truth and not given the wrong impression. The money is being made available to protect the property developers and the shock they imposed on the banks. None of it will go to small business and the attempt to make a gesture to small business is nonsense. There is nothing in the proposal for small businesses or mortgage holders.

Yesterday, I was informed by a man who was involved in a bank engaged in mortgage lending that the concession to mortgage holders under the proposed arrangement did not amount to a concession because the period involved is exactly the same as the period banks normally would allow.

Nothing has changed on remuneration. The decision to reduce salaries of millions by 33% is crazy and is being presented to us by the Minister and Government as some sort of concession. Senator Bradford is correct. Everybody is crying out for bankers to resign because they are responsible for this disaster. It is not unfair to describe them as the principal culprits in landing the economy in the manure business, yet they have brilliantly secured their own positions by making so-called concessions which are not concessions. In doing so, they will continue to wreck the economy.

I read carefully the concessions on remuneration. It is absurd that a committee, the covered institution remuneration oversight committee or CIROC, has been established. Why do we need a committee for everything when we should tell banking executives what pay they will receive? Under the new arrangement, bonuses will not be paid for the foreseeable and annual salaries will be reduced by 33%. This will reduce top salaries to about €1.5 million. Why have options not been addressed? The reason is share options are one of the greatest rackets operated in the banks in recent times. The Minister of State should mark my words, if the issue is not addressed in the document, the executives in the banks will write themselves share options galore within months or years of this arrangement entering into force. Share prices are at rock bottom. The Minister of State should not tell me that these guys would not do such a thing. They are the very guys who would do so and they will have spotted the omission a mile away.

The banks have outwitted the negotiators whoever they are - we never find this out - because while bonuses and salary increases will not be paid for several years, share options are the great gravy train. It is there that the millions are being made. Any annual report will show that these guys hold millions of shares, most of which they have received for free. This practice of awarding share options will continue.

The document is a complete surrender. I cannot believe a Government which held every card did not use these cards to get rid of every member of the boards of the banks, including the chairmen and chief executives. It is a disgraceful sell-out to the banks which have won an incredible victory.