Jim Walsh (Fianna Fail)

I have followed this interesting debate on the monitor. While the arguments are quite plausible, I must insert a note of caution, which I also did during our previous discussion on the Bill. People view directors as being knowledgeable of every aspect of their companies' running, but that is not the case. In the main, executive and non-executive directors, a distinction that one must make, meet on a monthly basis. The directors, specifically the non-executive ones, will give direction in terms of policies, the finances examined at each meeting and what must be done to improve performance. They give overall direction over where the company should go. To suggest that certain obligations relating to important minutiae would lift the corporate veil and expose directors personally to issues that, by virtue of their time spent on the company's operation, could not be grasped by them fully is to make a serious error in judgment in terms of where we are going in how businesses are run.

It has been argued by others and acknowledged by the Tánaiste that the law of the land applies to all companies. However, some executives within companies have designated responsibilities over a wide range of areas, including health and safety. Statutory obligations attach to them for the manner in which they administer their functions. However, I am seriously concerned about and critical of the thrust of policy that is being articulated by many in politics, namely, that we are heading towards becoming a nation of retirees and public servants. In that case, who will pay the Exchequer's bill of €41 billion or €42 billion other than the private sector?

We must encourage people to participate in and give of their time and expertise to the functioning, management and direction of companies, but only in a way where they are protected by limited liability. This is essential. Recently, there has been a thrust, no doubt promoted by elements within social partnership, to lift that protection. While it may seem plausible, let us consider the result. I am critical of the secure professions, including the legal and medical professions, for profiteering from the other sectors. A contingent liability does not attach to their functions. However, most other businesses are operated as limited liability companies for a good reason.

We must ensure the laws of the land are used to penalise people, but only in a reasonable and practical way. Let us not undermine people's interest in participating as non-executive directors. Many people argue we are only developing the role of the non-executive director, particularly in the private sector. Such directors add an extra dimension of expertise, which is important.

I caution against a catch-all measure so a director of a company does not have any protection from all sorts of eventualities over which he has no knowledge or control. We need to be cautious and careful, because that argument has not come forward strongly in the debate. The Minister has a responsibility to give very careful consideration to that side of the situation, so we have a thriving entrepreneurial business approach in this country which, despite the current climate of being dismissive and critical of that arena, has done a lot to get us to where we are economically.

While we are experiencing a downturn of some 8% or 9% in our GDP this year, it should not be forgotten our GDP increased since the mid-1990s at a rate of approximately 8% per year, which is one of the most significant and impressive rates in the world. I am trying to ensure we do not move in a direction which puts impediments in the way of that. I have seen many plausible arguments being made, not on this section of Companies Bill, which are being injected into policies and will be a disincentive for that particular area to grow in the future.

Those of us who work in the public service or are dependent on social welfare must realise that unless the private and productive sectors of this economy function properly, and are encouraged to do so, there may not be money to pay those in the public sector or on social welfare. We need to be very mindful of where we are going.