Marc MacSharry (Fianna Fail)

I am glad to have an opportunity to make a few points about whistleblowing in the financial sector. I would like to pick up on what Senator Twomey said. It would be extremely foolish for any Minister participating in a debate to dictate the position rather than to listen to suggestions and points that have been thought out by Senators. I hope some of the points we make today can be reflected when improvements are made in future legislation.

I agree with Senator Twomey that the culture until 2005 or thereabouts did not give whistleblowers any protection. The Minister of State, Deputy Calleary, alluded to a number of Acts that have been introduced since. We have legal whistleblowing safeguards to cover people reporting suspicions of child abuse, breaches of ethics legislation and competition law and problems with workplace health and safety. Gardaí and Garda civilian employees can report corruption or malpractice. Health care employees can report threats to the welfare of patients. Whistleblowing provisions also apply to offences relating to employment permits, the regulation of communications, consumer protection, offences relating to chemicals and breaches of charity law.

I am glad the Government is playing a part, to the maximum extent possible, in trying to change the culture. The Minister of State has outlined in detail that whistleblowing protections are needed in the financial sector. He has mentioned some of the difficulties in that regard. Senators can consider and respond to such points. I look forward to benefiting from the substantial experience of Senators Ross and Norris and others. As Senators, we can play our part in our democracy by giving our informed views. We are required to feed into legislation the will of the sectoral interests we are supposed to represent. The Senators I have mentioned represent the universities, just as I represent the industrial and commercial sector.

I am glad the speech made by the Minister of State was not prescriptive. It sought to deal with the complexities that he outlined which have made it difficult to introduce the simple overarching whistleblowers protection law we would have liked to have had before now. The Minister of State has mentioned that there was some engagement on the Private Members' Bill introduced by the Labour Party in 1999. We would all like the legal complexities in that regard to be overcome as quickly as possible.

Deputy Rabbitte has sponsored the Whistleblowers Protection Bill 2010 which has been discussed on Second Stage during Private Members' time in the Dáil. The purpose of the Bill is to provide protection from civil liability for employees who make certain disclosures, reasonably and in good faith, with regard to the conduct of the business and affairs of their employers. The Bill also proposes to prohibit the penalisation of employees by their employers in such circumstances. It sets out the persons to whom disclosures could be made and the categories of matters, in respect of which such disclosures would be permitted.

One has to acknowledge that cross-party efforts have been made to try to advance this issue. It seems from the Minister of State's remarks that the Government is trying to make progress with it as a matter of priority and as quickly as possible. Recent developments in the world economy make it all the more important for us to take this forward. The Minister of State described the spectacular failure in our own regulatory regime, from a financial services perspective. A Transparency International report in January stated the most obvious gaps in coverage of the whistleblower provisions relate to the reporting of offences under company law and financial services. This was referred to by the Minister of State. It also stated, regardless of the unethical events of recent years in some Irish enterprises, that the business community and vested interests remained actively opposed to protecting those who reported such wrongdoing. It recommended that Ireland adopt a generic whistleblower protection law, the principal of which was agreed by all concerned. This does not solve all the complexities involved. I am interested to hear the views of those informed about the complexities of the financial services industry such as Senator Ross, and the Minister of State's views in the preparation of legislation in this area.

I welcome the recent address by the Minister for Justice and Law Reform, Deputy Dermot Ahern, to the Law Society in which he stated any renewed prosperity must also bring with it reformed systems, strong laws and regulations to ensure it was not possible to play fast and loose with the financial and economic system. He stated that part of this reform would mean a rigorous focus on white collar crime, detecting and deterring it and bringing to justice those who perpetrated it.

The Minister has also proposed the introduction of blanket whistleblower protection for reporting suspicions of corruption, a new consolidated corruption Bill and a White Paper on white collar crime seeking public and practitioner input. We cannot have enough consultation when it comes to such important legislation.

The best example of whistleblower protection is the UK Public Interest Disclosure Act 1998, widely regarded as the international benchmark and which I am sure will form the basis of the Government's and this House's consideration of the appropriate provisions. It allows employees in the public and private sectors to report concerns to their employers, regulators and, in limited circumstances, the media.

Regarding the latter provision, the Minister of State has said consideration will have to be given to whether anonymous reports should be investigated. I believe they should be. In some instances there is a need for reports to remain confidential until such time as they are proved to be factually correct and require investigation. The universal charter has worked without legal mishap for ten years in Northern Ireland.

The Minister of State rightly pointed to the spectacular failure of the international financial regulatory regime and the Irish regime, which we all much regret. The new Financial Regulator, Mr. Elderfield, and the new head of the Central Bank, Mr. Honohan, are doing some good work in making improvements to the regime. The legal, accounting and auditing professions should also have their existing ethics and standards examined. They will contend everything they did when it came to financial institutions were to the highest standards of the day. These standards, however, fell far short of where they should have been. Accordingly, an examination of the respective organisations that represent these professions should be undertaken to ensure significant improvements can be made to their own regulatory regimes.

I hope all voices are heard during the consultation process on the White Paper on white collar crime. I am glad the Minister of State has an open mind on the matter and is listening to the views expressed in this House to ensure they feed into the process.

The Central Bank Reform Bill, currently going through the Houses, will put in place a new domestic regulatory framework for financial services and create a new fully integrated structure for financial regulation. The Central Bank (No. 2) Bill, to be published in the autumn, will enhance the powers and functions of the restructured Central Bank framework and will provide an opportunity to consider the provision of specific whistleblower provisions for the financial services sector.

It must be acknowledged that it is impossible to have any level of independent financial advice from financial institutions within which their employees are expected to operate in a targeted sales environment. This needs to be addressed by the State through the auspices of a statutory organisation.