Martin Mansergh (Tipperary South, Fianna Fail)

I thank all Senators who contributed to the debate. A large number of points were raised on all sides of the House. I will deal with two general points first. Since the emergence of the crisis last autumn, the Minister for Finance has been in this House from time to time. Enormous responsibilities are on his shoulders and it is not practicable that he could be in this House every week. Article 28.4.1 states the Government shall be responsible to Dáil Éireann. There has been a division of labour, whereby the Minister takes most legislation and motions in the Dáil, assisted by me, and I take most legislation and motions in this House, although he comes here from time to time. That is a realistic position.

When I speak on legislation and motions in this House, I set out the full position of the Government, as is done in the Lower House by the Minister. I hope I have access to the distilled wisdom of the Government and the Department of Finance. I have full access to its resources on any topic that may arise but I am speaking with delegated authority from the Minister.

The second general point is that this is a miscellaneous provisions Bill. In all areas of Government it is necessary to group together provisions that are not intimately related. Otherwise, there would be a proliferation of Bills and this would take more parliamentary time. There would be less legislation in terms of content, if not in the number of Bills. The Government is often urged by Opposition Members or Independents to use the opportunity of a particular Bill to insert something else. We do not go as far as the US Congress in the practice known as pork barrelling, where entirely unrelated subjects are tacked onto Bills. A miscellaneous provisions Bill groups in one Bill a number of broad aspects, but they are all related in one way or another to the problem we face.

I confess to being a little disappointed in that, although a major section of the Bill deals with universities which are represented by six elected Members in this House, there was almost no discussion of what is a very beneficial measure relating to university pensions and those of some non-commercial State bodies. Senator Bacik was alone in acknowledging the provision.

Senator Twomey spoke about private sector pensions being decimated. I declare an interest in that my son is employed in the private sector pensions business, but nothing I have to say will be influenced by this. As an employer, the State has an obligation to provide pensions for its employees. The Government is committed to dealing with the increasing cost of public service pensions in the context of its follow-up to the Green Paper. It has been acknowledged recently in regard to private sector pensions that there are very considerable difficulties which have been building since well before the full crisis hit last autumn. The Government has been working since publication of the Green Paper on pensions to bring forward proposals to help the pensions industry. The purpose of the measures introduced in the Social Welfare and Pensions Bill 2009 and the announcement this week of the establishment of a pension insolvency minimum guarantee scheme is to help trustees of pension schemes to respond to the challenge of maintaining the viability of a pension scheme or, where that may prove impossible, to assist them in enhancing the benefits to scheme members in the event of a wind-up. The pension insolvency payment scheme is another initiative taken by the Government, but in view of time constraints, I will not discuss it in detail.

There were a couple of general points made by Senator Twomey. On one side of the equation, he indicated that the bank levy should take effect now, although this is envisaged at a later stage, should it be necessary to do so when we have emerged from our difficulties. Listening to the Senator's contribution, one would be tempted to ask if Fine Gael was suggesting the Government should guarantee all private pension funds. Is it really Fine Gael's position that it is entirely against the introduction of a property tax? It was the Fine Gael and Labour Party coalition Government in the 1980s which introduced the residential property tax.

The Senator also made comments about the health service and implied that we should have introduced something equivalent to the National Health Service in Britain. Naturally, all of these elements would have very considerable cost implications. I am not convinced that the Senator is in any formal sense proposing any of these suggestions, but they are being dangled as alternatives. When in government, Fine Gael's position will not be as hinted by the Senator.

I agree with Senator MacSharry in his comments that if it were not for the current combination of circumstances - as much global as national - things would have been done differently. The pressures were entirely in the opposite direction and the mantra was that the country was awash with money and that the Government should have been doing far more than it actually was. If stamp duty had been lowered even more or abolished, as suggested, it would have made the bubble even worse; it would not have been a cure.

Much of the rest of the debate concerned banking issues. Reference was made to the report of the IMF which has endorsed the steps taken thus far by the Government in the banking sector. It commends our efforts at restoring financial stability through a step-by-step approach, involving the deposit guarantee scheme, recapitalisation and the creation of NAMA. The details of the NAMA legislation will be brought before the Oireachtas and debated in full. It is far more important to get the legislation right than for it to appear this week rather than next.

The IMF report states that "If well managed, the distressed assets acquired by NAMA over time could produce a recovery value to compensate for the initial fiscal outlays". The Government agrees that the purchase price of assets will be key; that is why time is being taken to establish NAMA which will be using an evaluation formula approved by the European Union. The IMF has indicated that temporary nationalisation could become necessary, but it must be seen as complementary to NAMA. The Government has already nationalised a bank and made it clear that it would only nationalise other banks as a last resort.

Senator Ross raised the legal action taken by Irish Nationwide Building Society. The objectives of NAMA cannot be fully achieved if individual borrowers are allowed to opt out. Legislation will address this and many other detailed issues. It would not be appropriate to comment in the House on legal actions taken by commercial bodies.

Most speakers accepted and supported the decisions of the Government relating to Anglo Irish Bank. There is no serious question that Anglo Irish Bank is and was of systemic importance to the Irish financial system and, in turn, the whole economy. Even if one could argue about this in an intellectual way, the risk of getting it wrong was simply far too great. As Senator Boyle pointed out, if we had got it wrong, the burden on the taxpayer would have been infinitely greater.

There is an analysis of the problems of banks and has been a range of commentaries during the financial crisis, including major international reports such as the Turner and de Larosière reports, because obviously the problem is not confined to Ireland. The Minister for Finance appeared before the Oireachtas joint committee, on which this House is represented, and discussed the Bacon report and the creation of NAMA.

The purpose of the amendments to the Credit Institutions (Financial Support) Act 2008 is precisely to enable banks to access medium-term funding of up to five years. This strengthening of the financial structure of the banks is to enable them to perform their proper role of providing credit in this economy.

A code of conduct for business lending to small and medium sized enterprises was published by the Financial Regulator on 13 February and took effect a month later. This code applies to all regulated banks and building societies and will facilitate access to credit, promote fairness and transparency and ensure banks will assist borrowers in meeting their obligations or otherwise deal with an arrears situation in an orderly and appropriate manner.

The business lending code includes a requirement for banks to offer their business customers annual review meetings, to inform customers of the basis for decisions made and to have written procedures for the proper handling of complaints. Where a customer gets into difficulty, the banks will give the customer reasonable time and seek to agree an approach to resolve problems and provide appropriate advice. This is a statutory code and banks will be required to demonstrate compliance.

As part of the recapitalisation package announced on 11 February, AIB and Bank of Ireland reconfirmed their December commitment to increase lending capacity to small and medium-sized enterprises by 10% and to provide an additional 30% capacity for lending to first-time buyers in 2009. If the mortgage lending is not taken up, then the extra capacity will be available to SMEs.

AIB and Bank of Ireland have committed to public campaigns to promote actively small business lending at competitive rates with increased transparency on the criteria to be met. Compliance with this commitment is being monitored by the Financial Regulator and officials from the Department of Finance are in regular contact with the banks concerned in regard to their progress in implementing these measures.

The Tánaiste and Minister for Enterprise, Trade and Employment recently set up a clearing group, including representatives from the main banks, business interests and State agencies, which is chaired by officials in the Department of Enterprise, Trade and Employment. The purpose of the group is to identify specific patterns of events or cases where the flow of credit to viable businesses appears to be blocked and to seek to identify credit supply solutions. Obviously, any issues or questions should be directed to the Tánaiste.

An independent review of credit availability funded by the banks but managed jointly by the banks, Government and business representatives is under way and will be completed shortly. Among the issues covered by this review will be changes in bank lending repayment terms and a comparison with customer experiences prior to the onset of the financial crisis. This review, along with the quarterly reports of the recapitalised institutions, should give a clear picture regarding the flow of credit in the Irish economy which will inform future policy.

I believe I have answered most of the main points raised.