Dan Boyle (Green Party)

I join in that welcome. The Minister of State has intersected in terms of my sojourns in the other House and this House. I am not sure whether his current position in the other House might mean that I will return to this House next week, but we will see what the Seanad electorate has to say about that. I was struck by the tone of the Minister of State's helpful contribution. There were some hints of the Government wanting to stress its distance from the situation that brought about our current economic situation and jab rather than point fingers, but that is forgivable in the circumstances in which we find ourselves, particularly so soon after a general election. In trying to find our way through an economic morass, we need to understand in the first instance that the factors affecting our economic development are multifaceted and the response to it is also diffuse. That means there is a collective responsibility to identifying and trying to deal with those problems.

There are some hopeful indicators and others that are less hopeful. We have agreed a package of measures with the European Union and the International Monetary Fund which will be difficult to meet in any circumstances. To indicate otherwise is not being honest with the stark reality of that agreement and with the people themselves. In attempting to meet those particularly stringent criteria we might ultimately fall short. There is an onus on those involved in that particular package, the European Union and the International Monetary Fund, to ensure that the effort in trying to achieve those criteria is not a retarding factor in Ireland's future economic development. That is something on which there will be collective agreement.

In meeting those criteria many hard decisions remain as my party found in our first experience of government and our contribution to economic policy. Decisions were made with our agreement and often at our behest in terms of dealing with the various difficult circumstances in which the country has found itself. Such decisions do not lend themselves - as we all too vividly know - to political popularity. To bring about a solution to Ireland's future economic development means risking the hard-won popularity the new Government has and thinking of politics, particularly in the area of economic development, in a longer term than up to the next general election. We find ourselves in this set of economic circumstances because successive Governments have not moved their eyes beyond that political timeline. Until we do so, it will be very hard to develop as a country.

That said, many of the changes we need to make are not necessarily policy linked or even accounting linked in terms of budgetary strategy. We still need to address issues relating to political and societal culture, and the idea of greed being good, benefiting the few. Those who cause most damage not taking responsibility for that damage feeds public anger. While that still occurs I fear that the rate of development and the timetable for success in such development will be hampered even further. We have seen an example of that in the past week. I will try to avoid finger pointing but contend that the idea of a chief executive – his title was under question – in a particular bank earning €3 million while that bank was losing €12 billion is incredible. People cannot understand that. That the decision was informed by public interest directors, among others, cannot be stood over by anyone in public life. With regard to future banking strategy, we must consider the question marks over the efficacy, efficiency and competence of people appointed as public interest directors of the various financial institutions. If they are not doing their job, we must get people who can do a better job. My party fully supports steps in this regard.

I welcome the small amount of movement in the Minister for Finance's statement on banking strategy. This is necessary because we have moribund and dead banks that need to be reconstituted into other structures. When in government, my party tried to consider the banking system itself. We should have financial institutions that reflect various aspects of the financial services market. We should have a common or garden commercial break and a co-operative small savers bank, a small lending institution. We should have pursued the more up-market development bank idea. It does not matter what political party is responsible for this; what is important is the mix. The mix in Irish banking at present is wrong, as are the structures.

There are worrying signs in respect of the general economy. The plan agreed with the European Union and IMF is predicated on average growth of 2.25% to 2.5%. It was not anticipated that we would reach this in the early years of the programme. It was hoped that, in the first year, the figure would be 1.5%. This figure was downgraded by the Central Bank to 1% and subsequently downgraded by the IMF to 0.5%. Every downgrade means more catching up must occur. Increasingly difficult decisions must be made on public expenditure. The new Government has further challenges regarding the catching up involved.

I would like to see the model turned on its head. Even if projected growth is downgraded by our institutions and those on which we are depending for capital and current expenditure, we should still note that in the most difficult set of circumstances we are achieving economic growth and developing structures to build upon.

I welcome the Minister of State's recognition that there are sectors in our economy that are performing quite well. With regard to investment and policy, my party, when in government, helped to achieve many of the successes, especially in respect of the green economy, renewable energy and information technology. The economy must be based on looking to the future. If we have learned anything from the collapses in banking, public expenditure and property over the past ten years, it is that an economy based on putting all one's eggs in the one basket is doomed to repeat its failures. I hope the new Government takes this policy lesson on board as soon as possible.

I want economic debates that move away from the very narrow and simplistic questioning of why we are where we are and how we got here. We are not where we are because of the bank guarantee; a bank guarantee of one form or another would have been needed in any case. The guarantee was too broad when given but the then Government acted sincerely upon information given to it, largely dishonestly, by many of the banks and operated according to what was perceived to be the best policy option.

An asset management approach was needed. During the debates on the NAMA legislation, the then Opposition parties, Fine Gael and Labour, spoke about an asset management approach in addition to the Government. I hope this approach is allowed to work. It is important that the property portfolio, which was bought at a considerable discount and has the potential to bring all the money back to the Exchequer, will be allowed to be sat upon such that its value will be maximised when sold. I was and still am worried that the Minister for Finance has indicated a fire sale approach to some NAMA properties. This undermines what NAMA and asset management should be about. We should try to obtain the best possible return for our money.

We must definitely move away from debating who was present at or asleep at various meetings. Very important policy decisions are not made on the spur of the moment, despite the impression that was being created. I hope this will be true in the case of the new Government also. Decisions are made on foot of broad consultation and there is much deliberation before and after those decisions. Every Government must face circumstances in which it must act immediately. Bearing in mind the report on the efficacy of the Department of Finance, one must note one of the main problems with decision-making here is the tendency to make decisions too slowly and apply them in a contradictory fashion. If the balance in this regard can be got right, I am confident we will get out of our economic difficulties sooner rather than later. Ultimately, however, if the country is to succeed we require political honesty of a kind that has, all too sadly, been lacking in the past.