Sean Barrett (Independent) | Oireachtas source

I welcome the Minister and thank him for his kind remarks about the previous Fiscal Responsibility (Statement) Bill. The remarks are appreciated. I thank the Minister for gracing an international economics conference with this presence during the summer. One of the questions that arose was what was happening to the Munster rugby team. The Minister's reply was that they are rebuilding and it is the same with the economy. The Bill is excellent and I will support it. The Bill proposed on 7 December 2011 had the support of every Member and the Minister will also enjoy the same support for this Bill. That was an occasion when the Seanad proved itself to be invaluable in the governance of the country.

Why do we need the Bill? One must protect the country against what happened on 29 and 30 September 2008. The Attorney General was there and future Attorneys General, after the Bill is passed, will advise that it cannot be done because of the debt brake and borrowing brake. These are useful instruments in rebuilding the country and I commend the Minister for having introduced them in law. They are needed. Parliament must respond to what happened on that dreadful night. There is now parliamentary and legal protection, which will stand up in court if anyone tries to perform that kind of act again. It is important because we need those rules and we are not alone.

The international aspect of the Minister's speech referred to the fact that many countries have allowed debt to GDP ratios to get out of control. We need protection against lobbyists, those who hijack the public purse, those who waste public money,empire building bureaucrats, quangos, subsidy seekers and pressure groups. Regarding the latter, I was astounded to see, in the Evening Herald on Monday, the former Governor of the Central Bank say that bailing out the banks was heroic. If that is heroism, we do not need it. It was a daft statement by the former Governor. It was a dreadful night for the economy but we now have legislative measures to prevent it happening again.

With regard to the people we bailed out, page 13 of the IMF assessment of Ireland dated 28 August 2012 says that SME credit is flat and new lending has slowed further. I agree with the IMF criticism of the banks. In 1947, in older times, when Trinity College Dublin was in receipt of a subsidy for the first time, the Government of the day said it was not to be used to pay more to those higher up. It is open to the Minister to examine the 1947 file and see if there is a way to bring some discipline to the way the banks have been conducting themselves. There is a view in the House that we need a rule preventing anyone in a grant-aided body from earning more than the Taoiseach. There have been criticisms about the high earnings of charities aided by public funds. We are trying to make this a fiscally responsible country after eight or ten years in which we were not so. That requires a great deal of change. The laissez-faire approach does not seem to operate anymore. Does too big to fail mean it is too expensive to save? I think it does. We must take many organisations off the public payroll so that we can balance the books again.

A handful of lobbyists can get an item of expenditure going and we never do broad cost benefit analysis from the point of view of society as a whole. That problem has existed. The problem of tax lawyers and accountants, the complexity of the tax code and the way their loopholes and tax expenditures are sheltered from the budget discussion we will be having in a few weeks time should be opened up for scrutiny. I commend the Minister for establishing the fiscal council on an independent basis and I commend the personnel in place. There was a cosy consensus between the Department of Finance, the Central Bank and the ESRI that got us into the euro without fully discussing the options and gave us a weak scheme of bank regulation. We need contrarian voices and I commend the Minister for the way he set up the fiscal council so that contrarian voices will be there. The wrong kind of consensus got us into this situation.

Can the Minister be accused, as happens frequently, of being hard hearted? We have done the borrowing experiment and it makes the rich richer, lobbyists proliferate, bureaucracy grows, bankers prosper, unemployment grows, inequality grows and the next generation inherits a debt mountain. There is a strong social case to support what the Minister is doing. We tried the experiment of borrowing 120% of GDP and ended up with 14.8% unemployment, as well as emigration.

The Bill is a good start to the necessary task of setting the public finances in order. It is a major part of the recovery agenda and I commend the Minister. I may table technical amendments at a later stage. The Minister's initiative deserves the support of the House, as the Bill in December received support.