[youtube=http://www.youtube.com/watch?v=afflg_VLARg]
Last night, the Seanad had an opportunity to debate the current economic situation, albeit without any type of framework from the Government. Nevertheless, I spoke on the issues as I see them. Above you will find a video of my contribution.
I support and agree with concerns about the delay in bringing forward the scheme which the Minister for Finance said would come before both Houses. We have seen what happened this morning in the UK. I do not believe it is accurate to say that the UK Government has copied the Irish Government. That is not true. The UK Government has taken preference shares in the banks it has proposed to assist and it has included a requirement that any bank wishing to participate in the scheme must sign up to an agreement on executive pay and dividends. There are many other differences between the UK Government’s proposal and what has been done here.
The Financial Regulator has said there is no difficulty with the capitalisation of the Irish banks. However, we have been asked to accept other statements from and about the banks in recent months which have proven not to be true. I note a nuance in the comments of the Minister for Finance this morning. He says he does not believe there is a difficulty with under-capitalisation. However, the Minister for Finance rather ominously stated that things are changing by the day. Therefore, it is not at all clear that there is not a difficulty with under-capitalisation in the Irish banks. What is the current position in Ireland with respect to the guarantee?
There is no guarantee is the answer.
The Minister for Finance and the Government announced an intention to provide a guarantee, which was a plan for the future, but there is no guarantee for today. This is a serious situation of which I do not make light as a topic for debate. However, the seriousness of the situation is increased with a further delay in the presentation of the scheme.
The delay also raised the question of what we were doing here last week in the overnight session. What was the point of it? We passed enabling legislation which has not been acted upon. Therefore, apart from the amendments to the competition legislation which, although important are marginal, the content of the legislation, the scheme and the guarantee are meaningless because nothing has been carried out. What were we doing here overnight last week? I do not have any difficulty with making myself available, nor do my colleagues. However, the sum total of our efforts add to nothing as nothing has changed. Our job is not to provide an overnight supporters’ rally for the work of the Government or the Minister for Finance. We are legislators and we are constitutionally required to scrutinise proposed legislation. The scheme was supposed to be brought before the Houses. Unless and until this happens there is no Irish guarantee; it simply does not exist yet. This is a reflection of the seriousness of the matter.
The Government’s intentions are becoming less, rather than more, clear with each day. The Minister for Finance has now indicated, perhaps correctly - I do not claim he has no basis for the comments, but it shows how unclear the position is - the possibility of a limit on the amount of deposits banks can take on. The developments in the UK this morning will have implications for foreign owned banks operating in Ireland. That may have implications for our scheme and there is the wider EU context. The situation is sliding by the day. All of the talk and congratulation we indulged in last week for being first into the breech now rings hollow. It looks like we are now one of the last into the breech in completing a proper scheme to put before the Houses and implement a guarantee. At present there is no Irish guarantee.
More :: I raised these issues in the Seanad and they were featured on RTE’s Oireachtas Report. Click here to view the programme (from 6min 10secs onwards).
