Brian Lenihan Jnr (Dublin West, Fianna Fail)

A relationship needs to have two parties to it and whatever agreement is drawn up or whatever is specified by the Minister, clearly the written relationship framework would be concluded after consultation with the Governor. The relationship framework fully respects the independence of the Governor and there is no question of the Minister trying to direct the Governor under that section. In fact the section is placed in the Bill after the section confirming the independence of the Governor of the Central Bank. The function of the relationship agreement is simply to provide that when the Central Bank is giving the advice to the Department it is done in a structured and consistent way.

An important and valid issue raised in the discussion is why all the powers are not simply being given to the Governor of the Central Bank in the first instance. That was reflected upon in the preparation of the legislation. However, the view was taken that given the scale of the emergency and the scale of funds that would be required to be deployed to address that emergency, the Minister for Finance of the day, as the person accountable to Dáil Éireann for public moneys, should exercise these powers. The Senator will have noticed from the programme that it is intended to establish permanent resolution legislation for banks and the intention is to publish such legislation by the end of February. That permanent resolution legislation will have the Governor of the Central Bank as the central person exercising powers under that legislation. If one likes, that is foreshadowed in this legislation and as the Senator rightly points out many sections can only be operated and implemented after consultation with the Governor, but also a wider relationship should be established so the Governor's functions regarding advice are clarified in different ways.