Darragh O'Brien (Fianna Fail) | Oireachtas source

As mentioned by the Minister of State in his opening speech on the Bill, the Fianna Fáil Party spokesperson on finance in the Dáil, Deputy Michael McGrath, previously introduced two Private Members' Bills, the thrust of which were accepted by the Minister for Finance and are now incorporated into Part 10 of this Bill dealing with the regulation of debt management firms and Part 12, dealing with the publication of information on how companies are operating the remit of this legislation so that people will know which financial institutions are stepping up to the plate and which are falling short. That is important.

The Minister of State also referred in his opening remarks to the deficiency in current legislation and regulation, particularly during the period of the Celtic tiger. This was not necessarily the fault of the regulations in place. We can make all the laws we wish to strengthen the powers of the Central Bank. However, what is important is application and oversight of those regulations. The Minister of State mentioned earlier that the financial services sector and financial services regulation is an evolving process. It is important the Department of Finance keeps a watching brief on this, that we remain ahead of the curve as much as possible and seek to introduce further amendments or legislation should that be deemed necessary.

Undoubtedly, we are a long way down the road of improving our regulatory structures and we, as the main Opposition party, will play a constructive role in bringing forward our ideas and legislation which we would hope would be accepted where the Government sees merit in them, as the Minister for Finance did with two legislative measures here.

This Bill is the second legislative measure brought forward to strengthen the Central Bank and its regulation following the Central Bank Reform Act 2010, which effectively dissolved the Irish Financial Services Regulatory Authority. The staffing and skill levels within the Central Bank and the previous regulatory authority were brought to the fore in many reports. Even prior to that, when Members across all parties, myself included, questioned the previous financial services regulator back in 2007 and 2008 in the Committee of Public Accounts, we raised concerns about the skill levels within these organisations. It is important to note that the appointment of Mr. Elderfield by my former colleague, the late Brian Lenihan, was recognised as a very good appointment. It brought forth a culture change within that organisation and ensured an increase not just in the number of staff, which is significantly higher than was employed in previous years and is very important, but also in the skill level and skill mix within the Central Bank.

Never again can we have a situation whereby the smaller firms, and I speak from experience in my previous profession, were subject to very heavy regulation but the banks and large corporations were effectively trusted to self regulate and do the right thing. We should never again lull ourselves into a false sense of security. Regardless of whether it is our two pillar banks or foreign institutions operating in this State, we should not take an institution's word for it regarding what it is doing or that it is following the regulations as it should. There is a great deal more work to be done not just by the Irish Government but also by the European Union to ensure there is a properly functioning European Central Bank with proper powers to oversee all other central banks within the European Union. Most of us remain critical of the slow pace at which the EU and the ECB have dealt with the financial crisis and some of the issues that have still not been dealt with five years later.

In the context of bringing forward good legislation such as this, none of us should forget that the people who are suffering because of these failures are not just Irish citizens but people across Europe. For that reason I earnestly ask the Minister, in advance of the publication of the statutory code of conduct on mortgage arrears later this month, not to allow the banks to have the major say in what is contained in that code of conduct. The previous Government and successive Governments allowed banks to have a major say in what should be done in the Irish market. We should not be driven by the banks telling us as legislators, and the Government and the Department of Finance, what should be contained in statutory codes of conduct. I await the publication of that code with interest. I hope what I am hearing about aspects to be included in it is not correct, such as allowing the banks for the first time to revoke people's tracker mortgages in certain instances and removing the protection from customers regarding the level of contact an institution can have with a mortgage holder.

This country still has not grappled with the mortgage crisis. There has been an increase of almost 45,000 in the number of people in arrears in the last two years. The situation will continue to get worse. I urge the Minister and his colleagues in the Government to be brave in what they do later this month and to try to tackle, once and for all, what I acknowledge is a very difficult situation. The failure of our institutions to assist those in financial difficulty, regardless of what legislation and regulation is in place, is basically proven by the fact that there have been a little more than 150 split mortgages offered to the many thousands of people who are in financial difficulty.

I realise I a straying a little from the content of the legislation, but this is all connected. We will table some amendments on Committee Stage and I note the Minister has advised that the Government will also table amendments on that Stage. Should there be no Seanad after this Dáil, I wonder what will happen if the Government was obliged to make amendments on important legislation such as this. Would that just be rammed through the Dáil as well, with a nod and a wink from everybody? However, that is a matter for another day. I thank the Minister for his statement and reiterate my party's support for this legislation.