The motions regarding the Tribunal of Inquiry (Dunnes Payments) and the establishment of a Tribunal of Inquiry are to be discussed together and shall conclude at 4.30 p.m. on Thursday, 11 September 1997. I call on the Taoiseach to move the motions. The opening speech of the Taoiseach, the Leader of Fine Gael and the Leader of the Labour Party shall not exceed 40 minutes in each case. The speeches of each other Member shall not exceed 30 minutes. Members may share time and a Minister or Minister of State shall be called on not later than 4 p.m. to make a speech in reply.
Report of the Tribunal of Inquiry (Dunnes Payments) and Establishment of Tribunal of Inquiry: Motions.
I move:
That Dáil Éireann
–welcomes the publication of the Report of the Tribunal of Inquiry (Dunnes Payments,
–thanks the Chairman and the legal and administrative teams for their work in conducting the Inquiry, and
–welcomes the Government's proposal to establish a further Tribunal of Inquiry.
Mr. Justice McCracken is to be complimented on his excellent report and on the manner in which he willingly undertook and carried out the onerous task assigned to him. The tribunal into certain allegations of payments to politicians was established last February, consequent on resolutions passed by Dáil Éireann and Seanad Éireann on 6 February 1997. I welcomed it; indeed, I had sought it. I also welcomed the appointment of Mr. Justice McCracken as chairman and spoke of his expertise in commercial law and in unravelling complex accounts, as well as his reputation for getting to the bottom of these matters in a short time. Mr. Justice McCracken has brought all these attributes to bear on his task during recent months and a debt of gratitude is owed to him by all of us. It is also appropriate that we commend, as he does in his report, the work of the team, both legal and administrative, which assisted him so efficiently in his work.
The report of the tribunal is a model of clarity and conciseness, and we must come to terms with the starkness of its contents. Its judgment, on what it has discovered, is trenchant, but in the circumstances appropriate. The tribunal stresses a point I have repeatedly emphasised, that public representatives must not be under a personal financial obligation to anyone. We are not dealing with legitimate political contributions here. While I felt a deep sense of relief on reading in the report that the tribunal had concluded that "no political impropriety", or, in other words, no actual corruption, had been shown to have occurred within its terms of reference, the findings of the tribunal in relation to Mr. Charles Haughey and Deputy Michael Lowry are nevertheless extremely disturbing.
Let me outline in particular what I, and I believe all of us, and indeed the tribunal find unacceptable. It is unacceptable that people who have held high office and enjoyed a high degree of public trust should give evidence that is "unacceptable and untrue", or deliberately conceal vital information from this House or from a tribunal established by this House. There is no excuse for this. It is also unacceptable that in the case of Mr. Haughey full co-operation was with-held from the tribunal forcing it to undertake lengthy, painstaking and costly research to establish facts, which could have been established almost at once with his full co-operation.
It is unacceptable that in a manner hitherto concealed from the public a Taoiseach should be personally supported to the tune of £1.3 million. It is appalling that any businessman should be able to believe, even if wrongly, that he could in any sense "buy" the Taoiseach, or that he might have him in his pocket, if he ever needed him. By accepting such favours, Mr. Haughey thereby laid himself open to the possibility "that political or financial favours could be sought in return for such gifts, or even be given without being sought", even though thankfully this did not occur. As the tribunal stated, "if such gifts were to be permissible, the potential for bribery and corruption would be enormous".
In the case of Deputy Lowry, who received several hundred thousand pounds in cash or in kind, the tribunal comments that he "made himself vulnerable to all kinds of pressures from Dunne's Stores, had they chosen to apply those pressures", and that indeed he would be open to blackmail from other sources.
There is also an issue of equity of access, that has arisen in the general context of political contributions. As the tribunal puts it, ‘if politicians are to give an effective service to all their constituents, or to all the citizens of the State, they must not be under a financial obligation to some constituents or some citizens only'.
Taoisigh and Ministers often have the duty to urge on the nation or on particular groups income restraint, and to warn that we all have to live within our means, but we should not require of others what we are not prepared to practise ourselves. Otherwise, we only encourage deep cynicism and a resistance to the notion that moderation can be in the long-term interests of all.
It is unacceptable that the people, who decide upon the laws, and especially those in Government who have to set an example for others, should engage in placing their money outside the jurisdiction in offshore accounts, not merely for the purpose of concealment from the public but in a way that lends itself to wholesale tax evasion. To avail of the tax amnesty, while politically condemning it and flouting its obligations, is particularly reprehensible. Paying tax is not something just for ‘the little people'. No one, however eminent, is above the law. Tax evasion is a form of stealing from the public purse, which pays for schools, hospitals and many other social services. The amnesty was an opportunity for full and voluntary restitution. If our tax system is too onerous, then it must be changed for all, not bypassed by a few with access to offshore accounts and resourceful accountants.
We must make it clear in this House by our actions that we are going to insist on the highest standards in public life. It would be very dangerous, if the message were ever to go out, either here or abroad, however ill-founded, that Government here operates on the principle of backhanders, or that there are golden circles with a high entrance fee. We must nip that notion in the bud once and for all.
The disgrace now being suffered by a former Taoiseach and a former Minister should be a solemn warning to any aspiring Deputy or any other elected representative to stick to the rules we make and by which others are required to abide. I accept the criticism that too permissive a culture has been allowed to develop, particularly during the past 30 years. While some may have been more outspoken in pointing out the dangers than others, can any party point to an entirely blameless record? The responsibility and the corrective action should be undertaken collectively. I am glad to say that the legislation we passed in the last Dáil went a considerable distance towards closing off possible avenues of abuse. We must find new more transparent and acceptable ways of raising necessary political funding from our supporters and well-wishers without making further calls on the taxpayer and without allowing a privileged few to create a sense of obligation.
I naturally and sincerely regret the damage to the reputations of those most directly concerned. Deputy Lowry did much good work for his constituency of Tipperary North, for which, despite everything else, the people there are still grateful, and some good work as an office-holder. However, as a new Minister he made the fatal mistake of preaching to others about cleaning out "cosy cartels" and implying that innocent third parties were in some way guilty of improper behaviour. Keeping offshore accounts, except where they are necessary or convenient for legitimate transactions abroad, is not my idea of patriotism or public duty. The question does arise as to what standards we expect of those who sit in this House, and whether the House has adequate sanctions in respect of unacceptable behaviour. We may need to put in place, on an all-party basis, tighter rules for continued membership of this House.
The record of Charles Haughey is well-known.
Parts of it, independent of anything related to this report, will always be controversial. However, in many important areas, valuable service by someone of immense ability will be recalled. For the positive things that he did he will always be held in high regard by many people. None of us will disagree with the verdict of the tribunal that "by allowing himself to be put in a position of dependency", Mr. Haughey "has devalued some of the undoubtedly valuable work which he did when in office". It is inevitable, unfortunately, that his achievements will now be seen or set off against what we have learned from the tribunal. I find that very sad for an individual that many of us know well and have honoured and admired. Nor is it just sad for the party he led or for his former colleagues in Government who sought to serve the public under his leadership. It is sad for our democracy and our nation that a leader who, after Lemass, put more of his stamp on the Ireland of the second half of the 20th century than possibly anyone else should have demeaned himself and political life by accepting such huge sums of money for his personal benefit from Ben Dunne.
There are some who wish to damn the entire Fianna Fáil Party by association and all the numerous honest and public spirited members who are proud to belong to the organisation. However, I am no more responsible for the misdemeanours of Charles Haughey than Deputies John Bruton, Dick Spring or Proinsias De Rossa are responsible for the misdemeanours of their colleague in Government, Deputy Michael Lowry, or would be for any other colleague who departed from politically acceptable norms of behaviour. All of us took Government decisions on the basis of the best information available to us at the time, on the political judgment of colleagues whom we trusted and in our view of the country's best interest. That is the view of Members on all sides of the House whenever decisions are made. If there was any hidden manipulation from motives of private gain, which has not so far been demonstrated, then none of us was aware of it at the time.
Why were we not more aware that something was untoward? In most walks of life, particularly with colleagues who have made a substantial income previously from a successful business or professional partnership, we respect their privacy and do not pry into their personal financial circumstances. Perhaps we were at fault for not asking more questions, though that is never an easy thing to do given our instinctive respect for each other's privacy.
That charge is levelled primarily against Fianna Fáil, even though Charles Haughey's leadership was more contested than any other. In the state of knowledge that we then had, his strong points had to be weighed against known flaws and honourable people took different sides of the argument. In that there was no conduct unbecoming. However, one could equally ask if Deputy Lowry's senior colleagues or his leader ever wondered at his facility in procuring substantial contributions both for the party and for themselves individually from Ben Dunne. It is easy to be wise in hindsight.
Politicians do not always appreciate the critical attentions of the media, to put it mildly. The media can sometimes seem to be unfair, particularly when they try to judge yesterday's actions by today's rules and standards, or when they single out an individual for persistent and unwarranted attack, but it is right to pay tribute to those in the media who exposed the state of affairs brought before the tribunal or who previously questioned it. The Fourth Estate — a free press — is vital to democracy. We, as politicians, are entitled to argue with people from the media where we think they are wrong and to defend our integrity and reputation where needs be. The price of freedom is eternal vigilance and the only issue in regard to the matters before the tribunal is whether there was enough vigilance and how we can in future ensure adequate vigilance.
It is our job to do everything in our power to restore public confidence in the political system. However, before looking forward it is necessary first to clear up the past. Answers are needed on essential points. I am not interested in hounding people to death, in witch hunts, or in scape-goating one or two individuals for faults in society as a whole. We have important problems, long-term unemployment and social exclusion, peace in the North and economic and monetary union to focus on. To the extent that the tribunal and related matters are impediments to concentrating on the central business of Government, we need to sort these matters out expeditiously without recourse to endless tribunals. We need to do the job properly, and not to have to keep coming back to it.
In the light of the report of the Dunnes payments tribunal, the evidence which was given before it and the limitations placed on it by its terms of reference, there seem to be reasonable grounds to investigate whether other payments were made which fell outside the terms of reference of the Dunnes payments tribunal. Accordingly, there is a motion before the House seeking the establishment of a new tribunal to investigate whether any payments were made to Mr. Haughey in the period from the beginning of 1979, and Mr. Lowry, while they held ministerial or public office and whether such payments influenced any decisions made by them in an official capacity. The terms of reference of the new tribunal are geared towards following the "money trail" rather than examining particular allegations concerning specific public, ministerial or Government decisions, so that we do not unnecessarily drag in innocent third parties or, on the other hand, omit decisions that may turn out to have been tainted.
The Government considers that following the money trail is the most efficient and effective way to progress this type of inquiry as witnessed by the great success of the Dunnes payments tribunal which adopted this approach. Any relevant decisions can be examined in the light of that. The tribunal will be required to ascertain whether there were substantial payments, who the donors were, how much was involved, when they were made, whether any of the controversial decisions were made at that time involving that donor and whether, as a consequence, the tribunal believes that either Mr. Haughey or Deputy Lowry did any act or made any decision to confer any benefit on that specific donor in respect of that particular transaction.
Deputy Spring has raised the issue of the party leader's allowance during Fianna Fáil's period in Opposition. In so far as I could with little available records I am satisfied, having spoken to the person who administered the account, that it was used for bona fide party purposes, that the cheques were prepared by that person and countersigned by another senior party member. Their purpose was to finance personnel, press and other normal supports for an Opposition leader. There was no surplus and no misappropriation. The person involved had sole control of the account. The money came in, the person lodged the cheque, dealt with the bills and invoices and paid those not covered by the ordinary allowance. The account as far as her excellent recollection goes was normally short, not the other way around. I have spoken to her at some length. She has served many Taoisigh beginning with Mr. Jack Lynch. We consider her to be totally honourable.
The motion also provides for the further investigation of the so-called Ansbacher accounts to ascertain if any funds were held there by or for the benefit of any other holder of ministerial or other public office. I remind the House in this regard that Mr. Justice McCracken has yet to decide whether the tribunal should proceed with its appeal against the ruling of the Grand Court in the Cayman Islands concerning these accounts. I have already stated that it is the Government's desire that the appeal should proceed, but I acknowledge that this is a decision solely for the tribunal. I assure the House that any resources which are required by the tribunal to proceed with the appeal, should it decide to do so, will be made available.
In so far as the Ansbacher accounts relate to private citizens, the Revenue Commissioners have the powers to pursue inquiries and will no doubt take into account in a more general way the picture presented and lessons learnt as a result of the tribunal. Large-scale tax evasion must be vigorously pursued, and those who engage in it must realise that if caught they face the possibility not just of severe penalties but diminished public standing and even public disgrace in the eyes of their fellow citizens, no matter how prominent they may be. No one is too powerful or wealthy to be investigated. It is appropriate at this time to refer to the Government proposals for legislation on Cabinet confidentiality that have been put to the House and will be the subject of a referendum on 30 October 1997. These include relaxation of the rule of absolute confidentiality of Cabinet discussions where the High Court determines that disclosure should be made in the interests of the administration of justice or by virtue of an overriding public interest pursuant to an application by a tribunal appointed to inquire into a matter of public importance as a necessary prelude to any investigation by a tribunal which is mandated in respect of issues on which it is necessary to seek evidence in relation to discussion at Government meetings.
In regard to the future, I have often stated my determination that financial probity should be strictly observed by all our elected representatives. The public is entitled to have an absolute guarantee of the financial probity and integrity of their elected representatives, officials and, above all, Ministers. It is a core value which I am sure is shared by all in this House that participation in the democratic life of this country is about public service alone.
It is important to draw attention again to these basic principles which must underpin our democracy. It is in this context that the report of the tribunal must be considered. To ensure these principles of good public service are rigidly adhered to, neither I nor the Government I lead will shirk from taking any decisions necessary on foot of the tribunal report. The aim must be to ensure mechanisms and structures are put in place so that the public can have full confidence in the manner in which public affairs are conducted from now on. The undertaking contained in An Action Programme for the new Millennium published by the two parties in Government to implement the recommendations of the McCracken tribunal will be honoured quickly. We may indeed go beyond them.
Turning to the specific recommendations made by Mr. Justice McCracken, on reflection and further consideration I agree with the tribunal that it would be impractical and ineffective to seek to impose an obligation on accountants, bankers and other professionals in regard to certain transactions concerning politicians.
The Government will consider the recommendations concerning extension of the powers of the Ombudsman to carry out investigations of breaches of ethics in public office. The Government will also consider the implementation of the recommendation contained in the Report of the Constitution Review Group, May 1996, and endorsed by the all-party Oireachtas Committee on the Constitution in its first report, that a new Article should be inserted in the Constitution in relation to the Office of the Ombudsman. Such a constitutional provision would confirm the establishment of the Office, providing for the independent exercise of such investigative and other functions of the Office as may be determined by law. A referendum on such a provision could best be held in conjunction with the referendum which will be necessary on the Treaty of Amsterdam. The Ombudsman, however, has much other work to attend to relating to the vindication of the rights of the individual citizen vis-à-vis the State, and more debate is needed before we would decide to shift radically the public focus of his work.
The report recommends that it should be mandatory for any candidate for either House of the Oireachtas to produce a certificate that his or her tax affairs are in order, accompanied by a statutory declaration to that effect. As promised in the Government's action programme, we had been examining such a proposal, which we strongly support in principle.
Government consideration will include reconciling the tribunal recommendation with the recommendation of the all-party committee on the Constitution in relation to the establishment of an electoral and ethics commission. As the all-party committee states in its first report, a single commission, incorporating the Public Offices Commission, the Constituency Commission and a proposed independent referendum commission, under the Constitution would guarantee the independence and impartiality of the commission; generate greater confidence in public life; create greater transparency in public institutions; and provide an independent source of advice and information in the areas of ethics in public life and electoral law reform.
The all-party report also makes the point that provision in the Constitution for such commission would provide a powerful constitutional mechanism to guarantee the probity of public life. I personally believe such body is the best way for us to go, so that we have a permanent watchdog in place, with the necessary powers, which will develop a special expertise in this area.
I hope this debate on the tribunal's report will provide an opportunity for these options to be discussed. Subject to the outcome of the Attorney General's examination of all these issues, the system which will be put in place will mean all allegations of impropriety by politicians or public servants will be dealt with in a comprehensive and transparent manner.
Pending the introduction of substantive measures by the Government, I have instructed that the necessary amendments to the Ethics in Public Office Act be prepared for introduction in the House in the next session to implement with immediate effect the tribunal's recommendation in regard to the creation of a criminal offence for breaches of the legislation and the consequent barring of a convicted person from standing for subsequent election.
Any decisions which will arise from Government consideration of the report will not prevent existing authorities such as the Office of the Director of Public Prosecutions, the Revenue Commissioners and the Comptroller and Auditor General from exercising their statutory powers as they deem necessary. I remind the House that the Chairman of the Revenue Commissioners has stated publicly that the proceedings of the tribunal had been monitored closely by Revenue and all appropriate action will be taken. The Minister for Finance has also indicated that any additional investigative powers required by the Revenue Commissioners can be introduced.
I now want to go through the legal rationale behind some of the terms of reference. The purpose of paragraph (a) of the terms of reference is to capture "substantial" payments of cash either directly to Mr. Haughey or through some third party or parties in circumstances where, from the point of view of an objective observer, there may be an inference that the motive for making such a payment was in some way linked with the holding of ministerial or other public office by Mr. Haughey. It goes further and captures substantial payments which, although not having the effect of influencing the discharge of ministerial or other public office, would still have the potential so to do. In other words, it does not matter whether or not there was any cause or effect associated with the actual payments. According to this term of reference, the tribunal does not have to look to see whether or not something was done in return for the payment but rather inquires into whether any payment was made at all. It also permits the tribunal to inquire whether such payments were used to discharge moneys or debts due by Mr. Haughey or due by any company with which he was associated or by any person connected to Mr. Haughey. A similar provision applies to Deputy Lowry.
The word "substantial" in relation to payment is not defined. It was proposed that the word "payment" should not include moneys or any benefit in kind less than £500 in current money values. However, it has been considered prudent to allow the tribunal itself to determine what is "substantial" without setting out any specific threshold.
It has been said it should be included in any terms of reference that an inquiry should be undertaken as to the lifestyle of Mr. Haughey and the sources which sustained it. The objection to this is that the concept of "lifestyle" is too nebulous and uncertain and would fall foul of the criterion set in the Tribunal of Inquiry (Evidence) Acts, 1921 to 1979 in that it lacks the characteristic of "definite". There is a risk that such a term of reference could be challenged in the courts as being ultra vires the legislation and as being too vague.
Paragraph (b) of the terms of reference captures the following class of bank accounts: (i) the Ansbacher deposits held for the benefit or in the name of Mr. Charles Haughey; (ii) the Ansbacher accounts held in the name or for the benefit of any person who holds or has held ministerial office; (iii) any other bank accounts that may be discovered by the tribunal in the name of or for the benefit of Mr. Haughey; (iv) any other bank accounts that may be discovered by the tribunal in the name of or for the benefit of a "connected person" to Mr. Haughey within the meaning of that term as it is defined in the Ethics in Public Office Act, 1995; (v) any bank account discovered by the tribunal held in the name of or for the benefit of any company in which Mr. Haughey owns a majority shareholding or is a director or member of the board of directors of the company.
This term of reference will enable the tribunal to inquire into the circumstances of the source of moneys paid into the above mentioned accounts. Presumably, these sources will be domestic and therefore it may not be necessary to seek evidence outside the jurisdiction, although this is merely supposition at this point. The focus of inquiry is not who benefited from the payments but who paid moneys into the above mentioned class of accounts.
Paragraph (c) of the terms of reference enables the inquiry to be focused on the recipients of any payments from the bank accounts described in (b) above. It is confined to payments from those accounts to recipients who hold or have held ministerial office. It permits the tribunal to inquire into such payments that were made at the time only that the recipient held ministerial office.
Paragraph (d) of the terms of reference goes one step further from (a) and (b) in that the tribunal, having identified whether payments were made to Mr. Haughey, and having identified the source of such payments, will then inquire into whether or not Mr. Haughey did any act or made any decision or conferred any benefit on any person who made such payments or who was the source of such payments or whether or not in fact he arranged for another individual, whether or not the holder of ministerial or public office, to do such an act or make such a decision. This term of reference in effect permits the tribunal, once it has established the fact of payment and the source of payment, to go on to identify, upon an examination through all the period that Mr. Haughey held ministerial office, whether or not there existed a connection between anything he did when he held ministerial office and the payment itself.
Terms of reference (e) to (h) relate to Deputy Lowry and follow a similar line of approach in relation to his case, taking into account differences in circumstances.
Paragraph (i) of the terms of reference goes one step further from (c) and (h). Once the tribunal has identified to whom the moneys were paid or for whose benefit the moneys were held and the source of those payments, if the recipient was the holder of ministerial office at the time of such a transaction, the tribunal is permitted to inquire into whether or not that ministerial recipient conferred any benefit on the person who was the source of that payment. The tribunal may examine whether or not that ministerial recipient procured any other person, whether or not a Minister or holder of public office, to do any act to confer any benefit on the source of the payment.
The word "payment" is defined for the purposes of the terms of reference as including not merely money but any benefit in kind. The word "substantial" is not defined. This would be a matter for the tribunal. "Connected person" is defined by reference to section 2(2) of the Ethics in Public Office Act, 1995, and this includes "relatives" as defined in that Act.
With regard to paragraph (j) relating to the actions of the Revenue Commissioners, this will have to be interpreted and implemented in a manner consistent with existing law.
The terms of reference include references to "benefit". This is defined in section 2(1) of the Ethics in Public Office Act, 1995.
The terms of reference at (b) and (f) refer to any company controlled by either Mr. Haughey or Deputy Lowry. The tribunal will have the benefit of the definition of "control" in section 157 of the Corporation Tax Act, 1976.
The terms of reference go on to describe the modus operandi of the tribunal which is to carry out such investigations in private as it thinks fit, using all the powers conferred on it under the Acts, to determine whether sufficient evidence exists in relation to any of the matters referred to above to warrant a full public inquiry in relation to such matters. This merely reflects what has become the practice of tribunals of inquiry in that before the taking of oral evidence, counsel for the inquiry, at the direction of the chairman of the tribunal, undertake the collecting of evidence relevant to the inquiry by means of the issuing of orders of discovery or letters of request to examine witnesses abroad. The fact that it is being formally stated in the present terms of reference merely reflects the desire of the Oireachtas that the tribunal undertake the groundwork before proceeding to a full-blown inquiry involving the taking of oral evidence, cross-examination etc. It allows the tribunal to assess the result of its preliminary groundwork as to whether it amounts to sufficient evidence to warrant a full-blown inquiry. This ensures that the tribunal will be efficient in its operation in that, if and when the tribunal proceeds to a full inquiry, matters upon which there is no evidence or insufficient evidence will not cloud the core issues before the full-blown inquiry. Private investigations also protect the integrity of the inquiry itself so that the line of investigation is only revealed when the tribunal deems it appropriate. It also protects the good name of innocent third parties.
In relation to any matters where the tribunal finds that there is insufficient evidence to warrant a full public inquiry, it will report that fact to the Clerk of the Dáil and report in such manner as the tribunal thinks appropriate on the steps taken by the tribunal to determine what evidence, if any, existed.
Though the Tribunals of Inquiry (Evidence) Acts, 1921 and 1979, are silent as to this two-tier procedure for an inquiry, it has been advised that it is within the scope of the Acts and constitutionally permissible. It is appropriate that at the end of the first tier of investigation by the tribunal to establish whether there is sufficient evidence to warrant a full inquiry, and if the inquiry reaches the determination that there is insufficient evidence to warrant a full inquiry on certain terms of reference, the tribunal should report the circumstances and reasons for such determination to the Dáil. This is simply the prima facie evidence principle in practice.
The whole procedure envisaged is a painful necessity for our democracy. It is essential that we dissipate the atmosphere of cynicism and suspicion and that we show we are capable of acting resolutely without fear or favour to defend it. Our aim is to have a republic free of any taint or abuse of power, that is honoured and respected at home and abroad, in the spirit of our President now about to leave office and of our founding fathers.
I thank the leaders of the political parties who have given me the benefit of their judgment on the matters they believe I should include in the tribunal's terms of reference. I have not been able to fully accept their recommendations but I thank them for the time and courtesy afforded me. I have tried to the best of my ability to include the central issues. I and my legal advisers in the Attorney General's office will listen carefully to the debate and to the points made. Deputies can be sure that I will try to take on board any matters that are deemed relevant. I assure the House that in preparing the legislation points made now or later will be taken into account.
The challenge for us is that we should be seen to get our house in order. We are an important profession in this democracy. People who serve in this House do so at great inconvenience to themselves and their families at all times. They are not particularly well remunerated for it. When independent groups indicate to what extent we should be remunerated we have difficulty in implementing even that. People in this House are honourable, and what we have to do in the period ahead is to prove that by bringing in whatever legislation is necessary we are prepared to stand on these issues and are not afraid to be questioned on them.
Mr. Justice McCracken has produced a clear, precise and judgmental report. It contrasts starkly with the non-judgmental and difficult to read report of the beef tribunal.
This debate is part of a painful but necessary preliminary to the cleansing of the Irish political culture. For too long we have had to live with the public perception that, in a way that is different from other occupations, people go into politics for what they can get out of it. That widespread if inaccurate public view has tainted everyone in public life. The sad reality of the clear and shocking evidence in the McCracken report is that people can now believe they have sound reasons for their long held suspicions.
Those who behave honestly and within the law in public life are angry and upset at this state of affairs. Many will justly see the fact that the McCracken report found no evidence of impropriety or favours granted by either Deputy Michael Lowry or Charles Haughey for the largesse bestowed upon them by Ben Dunne as a positive and supportive finding, but that will cut no ice with the people. They will believe in the quid pro quo. They will believe that there is no such thing as a free lunch, and they will go on believing it until the Irish political culture is changed. For that, among other reasons, the investigations must continue.
Constructive actions can and must be taken immediately to deal with the problems identified in and arising from the McCracken report and from earlier reports and inquiries into dubious transactions. We must end the insider culture that has allowed those problems to be created. Recent reports are full of examples of a structure of decision-making here that has deliberately allowed decisions to be taken by Ministers or officials on the basis of executive discretion rather than on the basis of unambiguous laws that are available to all and applied openly by the courts. This culture of executive discretion has its origin in the import licences and protected monopolies of the 1920s and 1930s. The modern expression of this unaccountable insider culture is to be found in the framing of special tax breaks for particular properties, the disposal of public assets without competitive tendering and the absence of clear criteria for rezoning some land but not other land. Once the laws allow discretionary decisions to be taken without clear rules, we create an environment for corruption. It is in the Bills that allow unaccountable executive discretion that we pass in sleepy committee rooms or a half empty Dáil Chamber that we create that environment in which corruption can flourish. In that sense no legislator can wash his or her hands of what may have happened.
If we want to change Irish political culture we must have the maximum separation of powers and the creation of veto points that can check arbitrary decisions. We must open closed sectors of the economy to competition and thus remove the cosy conditions in which cartels can operate. Competition is the enemy of corruption. As far as openness is concerned, the Freedom of Information Act is a major step in that direction. We need a complete audit of all our tax incentives and grant schemes to remove unnecessary executive discretion and occasions where the criteria for the exercise of discretion are vague.
We need to update our anti-corruption legislation. Under the ethics legislation of 1995 payments or gifts to some public officials must now be disclosed, but there may still be gaps. The legislation does not require a declaration of a decision maker's level of indebtedness, a factor that leaves individuals open to corruptibility. A tax compliance certificate does not in itself reveal whether an individual is vulnerable because of his or her personal debts.
The ethics legislation covers only disclosure. After 75 years of independence, our fundamental criminal offence of corruption is still dealt with under legislation introduced by Britain in 1889 and 1916. The following changes are required to that legislation. The law should impose a special obligation on those who hold public office and who know or suspect corrupt decision making to report it. Not only should there be immunity for whistle blowers, there should be a positive obligation placed on people in particular offices to blow the whistle. The law should criminalise the use of threats or deception to get a public official to make a decision in a particular direction, as well as the use of financial inducements. Special powers of the kind available to those investigating tax evasion or company fraud should be available to those investigating corruption. It should be made clear that the law against corruption covers decisions taken by Deputies in the Dáil. These may still be exempt from the 1916 and 1889 legislation by virtue of parliamentary privilege. Our criminal law against corruption should not be confined to the bribery of officials in Ireland. It should be an offence for a person from Ireland to bribe an official abroad. Our current tax law may allow bribes paid abroad to be tax deductible which is anomalous. We must update our legislation to deal with money laundering and the abusive employment of offshore accounts. Our money laundering legislation should be extended to cover estate agents, insurance brokers, accountants and lawyers as well as banks and building societies.
I will now deal with the Fine Gael problem, the actions of Deputy Lowry. When the story was first published of how the extension to his home was paid for, notwithstanding the closeness of our political and personal relationship, I gave him a very short time in which to come up with a satisfactory explanation. Deputy Lowry knew the alternative. He tendered his resignation within about 60 hours of the original revelations. Furthermore, as Members will be aware, some weeks later I gave him an ultimatum that he would have to publicly demonstrate his financial and tax affairs were in order or be ineligible to be a Fine Gael candidate. Deputy Lowry resigned from Fine Gael. He continued to protest his innocence and made a statement to the Dáil on 19 December last, which the tribunal found to be seriously incomplete, a statement, in the words of the tribunal, to be viewed with "some astonishment". Deputy Lowry made a personal statement on that matter today.
I have already made clear in public my view of his position. In his own and his constituents' interests Deputy Lowry should not continue as a Member of the House while he has so many personal financial issues to resolve.
Another widespread perception among the people is that many of those in business use under the counter payments, off shore accounts and contra deals of all kinds in the black economy as a way of evading tax. The McCracken report found that both politicians, Charles Haughey and Deputy Lowry, had availed of such methods to evade tax. That they did so may have been found out only because they were politicians, but that is irrelevant. They, like others who abuse our system and ignore the laws of the land, must face the consequences of their actions. This can and must be done by due process, without hindrance or pressure from politics. Non-politicians who used such methods to hide money should be pursued with equal vigour. Those are the comments I have to make about Deputy Lowry and his relationship — now ended — with Fine Gael.
I will turn to the responsibilities of the major party in Government, Fianna Fáil, in dealing with what has been revealed in the McCracken report about the party's former Taoiseach, Minister and dominant figure in the party for more than three decades. It came as no surprise to anyone that Charles Haughey required large sums of money to maintain his visibly lavish lifestyle, least of all to those associates of his who had occasion to visit his home over the years, where Mr. Haughey carried out much Government business. Some journalists and politicians tried unsuccessfully to force him to disclose the sources of his wealth down through the years. Serious questions were treated with derision. Mr. Haughey always seemed to have a willing band around him ready to crease their faces with derisory laughter when he treated with contempt serious questions on this matter from the press. Some of those faces are still visible on the Front Bench opposite. Do some of those in Fianna Fáil feel even mildly embarrassed that they were among those who laughed or gave moral support to their leader when these questions about his wealth were imperiously dismissed at press conferences and on public platforms?
While the issue was of public importance, it was, or should have been, a matter of serious concern to Fianna Fáil during those years, but the party was blind. We should also recall the withering media, political and public criticism of Garret FitzGerald's questioning of Mr. Haughey's suitability for office in a Dáil debate of 1979. Admittedly there were those in Fianna Fáil who wanted rid of Mr. Haughey and tried unsuccessfully to see him off. However, to my knowledge, the issue of his wealth and its sources was never raised publicly by his party colleagues after that period in the 1960s when the late George Colley had the courage to refer to "low standards in high places".
The matter was, of course well known and discussed privately within Fianna Fáil at the time, but nothing was said or done openly. The problem of Mr. Haughey's money was discussed in the conversation between Dr. Martin O'Donoghue and the then Minister for Finance, Ray MacSharry on 21 October 1982, a conversation that was surreptitiously taped by Mr. MacSharry with equipment he received from the Assistant Commissioner of the Garda at the request of the then Minister for Justice, Deputy Doherty. People knew about the matter, but did not do anything about it.
Why were these issues buried and why were media attempts to uncover the sources of Mr. Haughey's wealth denounced as vilification? Is it because of the legendary intimidation by Mr. Haughey of his party colleagues? Is it because people were cowed and fearful? If that is so, could it happen again?
Part of our response to the McCracken report must be to ensure it does not happen again, that political leaders can never again avoid serious questions about the source of obvious wealth, that a Taoiseach can never again be personally provided by a rich businessman with huge sums of money so that he can live in the style of an 18th century baron, without any accounting in public, that a Taoiseach can never again live as a kept man, leading a fraudulent lifestyle, probably many million of pounds beyond his means, evading tax in off shore accounts in the Cayman Islands and treating the public like suckers. One can only wonder how an entire political organisation, strong and powerful like Fianna Fáil, that fought so many battles with outsiders, could be so cowed into fearful silence by its own leader. It is clear from the McCracken report, and without the benefit of yet another tribunal, that Mr. Haughey's behaviour while he was leader of Fianna Fáil and of this country was indeed the very embodiment of low standards in high places. The ruthlessness with which he eliminated all his internal opponents within Fianna Fáil clearly had more than a political purpose.
It is not unfair to say, on the prima facie evidence available to us, that Mr. Haughey behaved like a Mafia don, and no Mafia don can operate without the aid of willing acolytes. For instance, Mr. Haughey held his grip on the party through intimidation. He insisted on a roll call vote on the motion of no confidence in his leadership of Fianna Fáil on 6 October 1982 and a majority of Fianna Fáil Deputies, including the present Taoiseach, Deputy Ahern, fully supported him and voted in favour of this intimidatory procedure. He expelled Deputy O'Malley from Fianna Fáil for “conduct unbecoming a member of Fianna Fáil” and again he was supported in this political act by the then Deputy Ahern. The very mechanisms of democracy that operate with a party such as Fianna Fáil must, therefore, be examined to ensure that such a scenario can never come to pass again. Fianna Fáil has yet to take a stand on whether Mr. Haughey is even now a member of or eligible to be a member of Fianna Fáil. We do not know whether his conduct is “conduct unbecoming” a member of that party in its eyes — that has not been said even yet.
Mr. Haughey's financial lifestyle was only possible because his political lifestyle was maintained by his political supporters. He would not have received those donations if his political lifestyle was not being maintained in that way. The acolytes of Mr. Haughey at that time, many of whom are still on the other side of this House, will have to ask themselves searching questions about their role in sustaining his political lifestyle through so many crises.
The inquiry into Mr. Haughey's financial affairs must take full cognisance of the speculation both public and private in the late 1980s when Mr. Haughey was in serious financial difficulties. All trails will inevitably lead back to the beef tribunal report. I am in no doubt that there must be a re-examination of that report in light of the revelations of the McCracken tribunal report. For instance, there must be a re-examination of how £500 million in export credit insurance was granted to the Goodman companies against the expressed advice of senior departmental officials and advisers. There must also be a re-examination of Mr. Haughey's direct involvement in the £25 million loans made available by the IDA to Mr. Larry Goodman and his company. There has never been a satisfactory answer to why the IDA board was pressurised into by-passing the normal procedures and waiving a jobs performance clause in the agreement with Mr. Goodman, after a meeting between Mr. Goodman and Mr. Haughey.
The beef tribunal report shows there was gross favouritism in the allocation of IDA grants and export credit in the beef industry. It shows that Cabinet decisions were ignored; huge personal benefits were conveyed to individuals at meetings from which officials who could account for them were excluded; Ministers did deals with private companies, pre-empting the grant-giving role of the IDA; and Irish export credit was squandered on non-Irish intervention beef that the then Ministers, Mr. MacSharry, Deputy O'Kennedy and Deputy Reynolds all must have known was likely to be non-Irish EU intervention beef — even the published trade statistics showed we were insuring more beef to Iraq than we were exporting there.
The beef tribunal report, like the McCracken report, revealed massive tax evasion, this time by the Goodman organisation. These accusations of tax evasion were publicly known to be before the beef tribunal in 1993 when the then Minister for Finance, Deputy Ahern, drew up the detailed terms of his tax amnesty. The justification for this unjust amnesty was that it was supposed to bring in unknown potential tax liabilities. The then Minister knew the Goodman Group had been accused of tax evasion before the beef tribunal. This was a known potential tax liability, not an unknown one. Despite this knowledge, he carefully drafted the tax amnesty provisions of his Finance Bill not to exclude firms from eligibility even though the taxes which might have been evaded were the subject of investigation before a tribunal. There was only one taxpayer in a position to benefit from that exemption. In sharp contrast, the then Minister provided that evaded taxes which were subject to an investigation by a court rather than by a tribunal would be excluded from the tax amnesty. Why did he make this distinction? Was that not a specific exception inserted to benefit a particular company? How can the Taoiseach explain that decision of his? All those who voted for the tax amnesty need to explain their support for the then Minister for Finance's decision to exclude from ineligibility for the amnesty taxes which had been evaded and which were being investigated by the tribunal.
The sale of Carysfort College to UCD must now be re-examined in far greater detail and with far greater rigour. It defies belief that Mr. Pino Harris could make a £1 million profit on the turnaround in the purchase and sale of this prime site without Mr. Haughey and the Government having applied pressure on the education authorities in UCD to purchase this property. It was well known that UCD would have preferred to build its business school on the Belfield campus.
Exactly the same pattern of collective Government decision making is to be found in the Carysfort case as was disclosed in the beef tribunal. Ministers worked alone, without civil servants to ensure accountability. The absence of civil servants from eight meetings with UCD, some of them involving Mr. Haughey, the Minister, Deputy O'Rourke, and others between 11 September 1990 and 12 December 1990 does not, to quote the Committee of Public Accounts, "suggest the degree of transparency which one would expect to be evident in all financial transactions of the State". The then Minister for Education, Deputy O'Rourke, is now deputy leader of Fianna Fáil and Minister for Public Enterprise.
In the beef case, matters were rushed through Cabinet without proper procedures being followed. Ministers, including the present Taoiseach, acquiesced in this and were collectively responsible for it. The same happened in the Carysfort case. The Committee of Public Accounts found that at a meeting of the Cabinet on 4 December 1990 the Government decided to approve funding for the purchase of Carysfort for UCD "without having a formal memorandum presented to it" and in a way that prevented the Department of Finance from presenting cogent observations on the financial wisdom of the decision. The then Minister for Education, Deputy O'Rourke, proposed this, Mr. Haughey was in the chair, and I believe Deputy Ahern was at this Cabinet meeting. Deputy Reynolds was Minister for Finance at the time. None of them did their job properly.
The involvement of Mr. Haughey's successor, Deputy Reynolds, in the passports for investment scheme has already been documented and debated in this House. The deep involvement of Mr. Haughey in this scheme when he was Taoiseach has already been referred to publicly by the current Minister of State, Deputy Molloy. It is known that, as Taoiseach, Mr. Haughey met privately on at least one occasion with overseas investors who acquired Irish passports. He met them privately — note the pattern. In the beef tribunal it was found that Ministers, including Mr. Haughey and Deputy Reynolds, met beef interests without civil servants being present. In the case of Carysfort, representatives of UCD were met by the then Taoiseach, Mr. Haughey, and the Minister, Deputy O'Rourke, without officials being present. In the case of the passports for investment scheme, Mr. Haughey met investors without officials being present. There is a pattern. It is also known that naturalisation certificates for some of these people, which are normally signed by officials, were signed by the current Minister for Foreign Affairs and then Minister for Justice, Deputy Raphael Burke.
At some stage after 1987, as we know from the Minister of State, Deputy Molloy, effective control of the passports for investment scheme passed from the Department of Justice to the Department of the Taoiseach when Mr. Haughey was in office. We need to know why this decision was taken and whether the then Ministers for Justice, Gerard Collins and Deputy Raphael Burke, approved of the decision to hand over this responsibility to the Taoiseach. Were any officials in the Department of the Taoiseach involved in the administration of the scheme or, as was the case with the beef industry, were all meetings in regard to passports held between Ministers and those who could benefit from their decisions without officials being present?
Was there a file in the Taoiseach's office on passports for investment when Mr. Haughey or Deputy Reynolds were Taoiseach? Where is that file now? Was it shown to the then Tánaiste, Deputy Spring, when he was shown the Department of Justice file on the subject? Was he told there was another file? Was he told that the Department of the Taoiseach dealt with this matter when Mr. Haughey was Taoiseach and that, therefore, there would have been another file? If not, why was he not told?
Subsequent to Mr. Haughey's time as Taoiseach the family business of his successor, Deputy Reynolds, received an investment of £1.1 million. Incredibly, Deputy Reynolds claims he never met the investor nor had his company prior dealings with him. Happily, however, the then Minister for the Environment and current Minister of State, Deputy Michael Smith, was able to write to the Minister for Justice assuring him that he could vouch for the lender from personal knowledge and intimate acquaintance with him. The Tánaiste's party colleague, Michael McDowell, rightly dismissed this whole saga as shameful.
The style of decision making evidenced in all three cases — the beef industry, Carysfort and passports — is one for which every Minister who sat at the Cabinet table at the time is collectively responsible. They may not have been responsible for every individual decision but they were collectively responsible for the style of decision making by the Cabinet which they allowed to continue. They were responsible for the delegation of responsibility which they allowed, just as in the McCracken report all the directors of Dunnes Stores were deemed responsible for the delegation of authority which they allowed to their managing director. Every member of the Governments of which Mr. Haughey was a member and which did business in the way I have just described was collectively responsible for delegating authority in a way which allowed such decisions to be taken.
It is not possible for members of those Governments, such as the current Taoiseach and the Minister, Deputy Woods, who are present in the Chamber, to say it was all Mr. Haughey's business and had nothing to do with them. The essence of collective responsibility is that all 15 Ministers are responsible for each other's actions. It is not possible for a Government which went to the Supreme Court to defend Cabinet confidentiality on the grounds of collective responsibility to say now there is no collective responsibility for everything done by Mr. Haughey and his Administrations of which they were members. They cannot have it both ways. They cannot use collective responsibility to justify the maintenance of Cabinet confidentiality but then say there was no collective responsibility for Mr. Haughey's actions as Taoiseach and his allowing business to be done in the absence of officials.
The importance of the absence of officials from these meetings cannot be overstressed. The only control we have in this House to ensure taxpayers' money is not misappropriated is the procedure whereby the Accounting Officer, the Secretary of the Department, must account to the Comptroller and Auditor General, and ultimately to the Committee of Public Accounts, for the way in which money is committed. However, if a Minister holds a meeting at which money is committed from which a permanent civil servant is excluded, that exclusion represents in itself a deliberate subversion of the system of accountability to this House through the Secretaries and Accounting Officers which was created at the foundation of this State to ensure probity.
Any Minister who held a meeting which involved the commitment of money and from which officials were excluded must explain prima facie that such procedures were not corrupt. The burden of proof that nothing wrong occurred rests with anybody who held such meetings because such exclusion, in itself, subverted the system of accountability. I have given three examples — the beef industry, Carysfort and passports for investment — where valuable assets such as passports, grants, loans and export credit were given away at meetings from which officials were excluded.
There is one obvious step which the Fianna Fáil organisation, particularly the Taoiseach, Deputy Ahern, has failed to take. It would surely have been in Fianna Fáil's interest — and definitely in the public interest — if the Taoiseach had by now publicly called on Mr. Haughey to come clean on his finances and co-operate fully in advance of this new tribunal. It must be noted that the Taoiseach, when he was Leader of the Opposition, and the Fianna Fáil Party failed to ask Mr. Haughey to co-operate fully with the tribunal when he was manifestly failing to so do. Now that he is Taoiseach, Deputy Ahern has not yet asked Mr. Haughey, as the leader of his party and as a matter of party discipline, to co-operate with the tribunal.
He is not a member of the party.
I hear Deputy Woods saying that Mr. Haughey is not a member. He obviously knows more than the Taoiseach who is sitting beside him because when the Taoiseach was recently asked that question he said he did not know whether he was a member. Does Deputy Woods believe Mr. Haughey is eligible to be a member of Fianna Fáil? If not, why has his party leader not said he is ineligible to be a member? Is the party still afraid to say, even now, that his conduct warrants being described as conduct unbecoming a member of Fianna Fáil?
Come on Michael, do not be shy.
I will speak tomorrow in my due time.
There is one overriding truth which must be confronted. If Mr. Haughey did wrong in his public business he could not have acted alone. He needed the co-operation of either senior Ministers or senior officials, or both. That cannot be evaded. The Taoiseach stated, "I am no more responsible for the misdemeanours of Charles Haughey than Deputies John Bruton, Dick Spring or Proinsias De Rossa are responsible for the misdemeanours of their colleague in Government, Deputy Michael Lowry". That would be true in regard to either Mr. Haughey's or Deputy Lowry's private affairs. However in regard to their public responsibilities and any misdemeanours that may have been committed in any public decisions they made, we are responsible. There is a clear distinction between private and public responsibilities. I drew attention to this point and I was continually misrepresented for having done so. However, that distinction exists.
If Mr. Haughey did something wrong in any of the public examples I gave, such as the beef, Carysfort or passports issues, it cannot be said that the same responsibility rests on his colleagues as rests on Deputy Lowry's colleagues with regard to his private tax affairs. The two are not in the same category. We have no concept of public accountability unless we understand that distinction.
One matter is outstanding from the serious consultations, which were welcome, between the Government and the Opposition parties in recent days. I understand the Government is considering a two or three person tribunal. I caution it against such a move. The procedure which worked in the Finlay and McCracken tribunals was excellent and we should be reluctant to depart from it. The idea of a three person tribunal, where there might be a two to one vote on a specific issue, does not commend itself. The possibility that the chairman of the tribunal might be outvoted on a particular question by two others is not favourable. Some thought should be given to this aspect.
It is most important that a serious judge is appointed to the tribunal. All judges, in the same way as all politicians or grocers, are not the same. Some can make judgments; they can come down definitively on one side or the other. However, others find that painful and cannot do it. There is no point having a non judgmental judge chairing the tribunal. We must have a judge like Mr. Justice McCracken who can come down off the fence and make judgments. It is most important this matter is taken into account in the choice of person. In a sense, this aspect is as important as the terms of reference. I appreciate that the choice is a matter for the Government, having consulted the President of the High Court, and not the House. It would impossible if the Government had to seek the agreement of all parties to a name. I do not suggest such an agreement should be sought but I advise the Taoiseach that he should be rigorous in his choice.
I welcome the motion in so far as it goes and the establishment of a new tribunal which will be difficult and sometimes painful. However, it is necessary in the interests of political life that we undertake a detailed and rigorous examination of all the outstanding issues and that we collectively seek new ways to re-establish the role of politics in society.
The essential meaning of politics is public service. The House is the engine room of our democracy and its Members are, almost exclusively, dedicated to doing a professional and decent job of representing their constituents. The events we are debating and a range of other issues have distorted and muddied the perception of politics and politicians. If we are ever to clear the mud away, we must be prepared to face up to a relentless search for the type of standards which reflect the aspirations of the public we serve.
During my contribution I will elaborate on a number of amendments I tabled. I acknowledge the consultations that the Government afforded the Opposition. They have gone some way towards meeting the points we made in response to the original draft. In particular, I acknowledge that the Government has adopted points I made, and even the language I used, in my letter to the Taoiseach last Friday. I also pay tribute to the courtesy and efforts of the Attorney General. Attorneys General have not been praised often in the House in recent times but the current Attorney General, although he has been very busy in recent weeks, has been helpful and open to the Opposition in trying to reach an agreement on this issue.
However, I maintain that there are flaws in the terms of reference. I hope that in the course of the debate the Government will give serious consideration to the amendments which have been tabled. In seeking to address the necessary changes, I have sought to develop more fully some of the points I put forward originally. I will return to the amendments in more detail later but I wish to mention the McCracken report and the lessons we need to learn from it.
On the day he retired as Taoiseach in the House, former Deputy Charles Haughey described himself as having "done the State some service". Whatever about that, it is certainly the case that Mr. Justice Brian McCracken has done the State and all its people a considerable service. The clarity and directness of his report make it easy and gripping reading and the lessons in it will serve as a model for years to come. It should be required reading for everyone involved in public life at all levels.
Judge McCracken is straightforward in his report. He dismisses outright Mr. Haughey's claim that he knew nothing about how his financial affairs were handled over many years. He expresses the feelings of the great majority of people when he says that "it is quite unacceptable that a Member of Dáil Éireann, and in particular a Cabinet Minister and Taoiseach, should be supported in his personal lifestyle by gifts made to him personally". He has rightly asked the Director of Public Prosecutions to consider whether Mr. Haughey should be prosecuted for, in effect, lying to the tribunal.
He is equally scathing about Deputy Lowry. He accuses him of benefiting from the black economy from shortly after he was elected to the Dáil and of cynically ignoring and evading the taxation and exchange control laws of the State. Who can disagree with Judge McCracken's assessment that "if such a person can behave in this way without serious sanctions being imposed, it becomes very difficult to condemn others who similarly flout the law"?
I have already called on the Government to ensure that the entire report and the web of deceit and criminality it uncovers is referred to the Director of Public Prosecutions immediately so that he can consider what additional action is necessary in relation to offences under tax law, exchange control law, and company law generally. The recommendations of the report, and especially those that have implications for the House and its Members, should be referred to a special committee of the House for immediate examination. I call on the Government to establish such a committee immediately.
As far as Mr. Haughey is concerned, he has engaged in wholesale lies and deliberate tax evasion. He was a holder of the most important office in the State and he dishonoured it. There is an onus on the Government, and especially on his party leader, to take steps immediately to prepare and outline the political sanctions necessary. Judge McCracken is very clear about the unacceptability of Mr. Haughey's behaviour. The political system must be prepared to demonstrate equally clearly that it is prepared to follow these findings to their logical conclusion and that all appropriate legal, financial and political penalties are applied. This means that the Revenue Commissioners must pursue all taxes owed; the Director of Public Prosecutions must consider whether other prosecutions are warranted and the Government must review whatever perks are in place to ensure Mr. Haughey's comfort as a former Taoiseach.
With regard to Deputy Lowry, it is clear that he too has been indicted in relation to cynical and systematic tax evasion, compounded by criminal breaches of exchange control regulations. It is equally clear that Deputy Lowry brazenly misled the Dáil in his detailed statement on 19 December 1996 when he failed to mention payments of more than £100,000 and when he referred to offshore accounts in such a way as to imply that he had no involvement in such things. Although I am aware that it is not considered appropriate to comment on personal statements made by Members in the House, I doubt if any Member was impressed by the statement made by Deputy Lowry today.
The question one must ask is why it took him so long. He said nothing in the House that he could not have said on the day the report was published, although then he seemed almost to claim some type of vindication from the report. One must also wonder why he dealt with none of the criticisms made by Judge McCracken but confined himself only to those issues where he misled the House. It is right and proper that Deputy Lowry should consider himself as having unfinished business and that the new tribunal should pursue that unfinished business to its ultimate conclusion. There are other issues to be investigated, and we are here to discuss how that should to be done. We all know about a number of decisions made by Governments in which Mr. Haughey was Taoiseach — and we all know about the rich people who were made richer by those decisions. No matter how difficult it is to set up further investigations, those decisions will have to be gone into again. Judge McCracken uses the phrase "an unhealthy relationship" to describe this. We have to root out the basis for all such unhealthy relationships in Irish life.
The terms of reference in front of us refer to "no decisions". I appreciate the difficulty of framing terms that would retain focus, and yet allow and encourage the tribunal to explore areas of public concern. However, we must, in our terms of reference, at least try to set a tone for the tribunal that will encourage the exploration of controversial decisions. That is why I have proposed an amendment to the terms of reference which, while it would not set specific tasks, would establish a tone for the tribunal that would provide a measure of reassurance that the search of the so-called "money trail" has a deeper purpose to it.
The amendment I propose is in the following terms, and I propose that it go in as a second paragraph:
Bearing also in mind serious public concern that certain decisions (including as examples those relating to the sale of lands at Carysfort and Glending Woods, the rezonings of land in the greater Dublin area, issues arising from the sale of the Johnson Mooney and O'Brien site in Ballsbridge, Export Credit Insurance, the grant of the ESAT Digifone licence, and the grant of citizenship under the Business Migration Scheme) made by holders of public office may have been improperly influenced or obtained.
Members of the House may well have other issues they would wish to see included in this illustrative list. I would be more than happy to support the inclusion of additional issues, should Members wish it.
We are all now agreed that the so-called Ansbacher accounts uncovered by the tribunal must be fully investigated. We need to know what other people were using these accounts and for what purposes and to who else was Mr. Haughey indebted. Tens of millions of pounds, in the region of £38 million, are hidden in these accounts. The public is asking why? Whose money is it? How much more of it was or is being used to support Mr. Haughey's lifestyle or future? We must get to the bottom of the Ansbacher accounts if there is to be a satisfactory conclusion to this tribunal.
This gives rise to the next difficulty about the terms of reference. As I read them, they will not enable a tribunal to get at the source of the Ansbacher accounts without first establishing that any moneys there are for the benefit of Mr. Haughey or other Ministers. To put it bluntly, people who had money salted away in the Ansbacher accounts for commoner garden illegal purposes may well be immune under these terms. It may well be argued that these are ordinary citizens, caught up through no fault of their own in the machinations of Mr. Haughey and his financial advisers, but it is impossible to escape the conclusion that every single person who invested in the Ansbacher accounts was involved, knowingly, in a highly orchestrated and well-designed tax scam. There is absolutely no reason they should be exempt from scrutiny and disclosure in this tribunal.
For that reason I have tabled an amendment which would have the effect of opening up the Ansbacher accounts to a much fuller scrutiny than is at present envisaged. I urge the Government to reconsider its position in the matter, and I will insist on a vote on this amendment if necessary. I have said on many occasions that this House, and the public, is entitled to a detailed explanation, based on an impartial investigation, into the way in which a million pounds in Party Leader's Allowance was used by Mr. Haughey in the 1983-1992 period, and into the way in which that money was managed by Fianna Fáil Party officers in the period. I have listened carefully to what the Taoiseach has said today about that money. It was a great deal of money, perhaps not in the context of £38 million, but it was taxpayers' money, meant to be used for political and parliamentary purposes only. We need reassurances on that.
I have tabled the following amendment, which would require the tribunal specifically to examine:
the manner of disbursement by Mr. Haughey of public moneys received by him by virtue of his office of leader of Fianna Fáil in the years 1983 to 1992, and the procedures and controls which were applied by him or the Fianna Fáil Party to such disbursements.
However difficult it might be for people still in this House to face this issue, I believe we must. There should be records available for people employed in the private office in relation to salaries paid and tax deducted from them.
The terms of reference set out the areas of reform that can be considered by the tribunal. We need to go further. The integrity of public administration; the dependence of politics on private and secret money; issues of company law and the role of company directors; the role of the Revenue Commissioners, its independence and future accountability; the role of the Central Bank as a regulator and indeed the regulation of relevant professional people all need to be explored by the tribunal. I have tabled the following amendment, in place of paragraphs (k) and (l) of the existing terms, to try to achieve these objectives:
And further in particular, in the light of its findings and conclusions, to make whatever broad recommendations it considers necessary or expedient
(i) to ensure that the integrity of public administration is not compromised by the dependence of party politics on financial contributions from undisclosed sources;
(ii) for the reform of the disclosure, compliance, investigation and enforcement provisions of company law (including in particular those which relate to directors' duties);
(iii) for securing the formal independence of the Revenue Commissioners in the performance of their functions while at the same time ensuring the greatest degree of openness and accountability in that regard that is consistent with the right to privacy of compliant taxpayers;
(iv) for enhancing the role and performance of the Central Bank as regulator of the banks and of the financial services sector generally, and for the effective regulation of the conduct of their members by such professional accountancy and other bodies as are relevant to these terms of reference, for the purpose of achieving the highest degree of public confidence.
I hope the Government parties will be willing, after further examination, to support this amendment. If it is adopted, I further hope the tribunal will rely on far more than submissions from political parties before reaching its recommendations. There are many areas of expertise and concern in Ireland that could usefully contribute to the tribunal's deliberations, and I hope the tribunal will consider this to be an important aspect of its work, rather than an afterthought.
The final amendment I have proposed is, I hope, non-contentious. We should allow the tribunal to work in private or in public as it sees fit. I am not sure the terms proposed by the Government give the tribunal sufficient flexibility and freedom in that regard.
The road on which we now embark will be long, complicated, and painful, but it is fundamentally essential. We were fortunate to be served by Judge McCracken in the last tribunal, and I hope and expect the Government will consult the Opposition about the appointment of the next tribunal. I wish it well in its work, and I commend the amendments proposed to the House.
I greatly welcome the report issued just over two weeks ago by Judge McCracken. It restores one's faith in tribunals of inquiry. The tribunal was effective and expeditious. The report is readable, concise, clear and delightfully unambiguous. It is not afraid to confront prominent people with their wrongdoings.
The McCracken report speaks for itself and does not require any great review or examination by me. We should concentrate our efforts on trying to ensure that McCracken is built upon and that the openings and leads provided by it are followed and not ignored in the way many matters referred to in the beef tribunal report were subsequently ignored. Much of the evidence to that tribunal was completely overlooked as if it had never happened. I hope there will be prosecutions as appropriate, not confined as in the past to one journalist and a handful of minor players who were not beneficiaries. I hope on this occasion the Revenue Commissioners, who are frequently so assiduous in pursuing small defaulters who have often simply fallen on hard times, will pursue with the full rigour of the extensive powers given to them by this House, the people who have been identified as being in breach of the taxation code in a serious and ongoing way.
I welcome paragraph (j) of the terms of reference relating to the Revenue Commissioner. Ideally it should be wider because the beef tribunal report identified clearly what is probably the largest and most professionally organised systematic fraud on the Revenue in the history of the State. It was carried out by a major beef group with professional assistance. To the best of my knowledge, after examining the Revenue Commissioners' Annual Reports since then, no prosecutions have been taken or penalties imposed in respect of that widespread and systematic taxation fraud. I have heard it suggested that those who perpetrated it were allowed to avail of the tax amnesty, which seems amazing. It is also noteworthy that the Institute of Chartered Accountants did not see fit to take any action as a result of what came to light in that report.
I hope the new tribunal's powers are wide enough to enable it to look into the various matters of a serious nature that came to light in the beef tribunal report where no action was taken. The willingness to turn an official blind eye to fraud and to huge tax evasion brings all the laws of the State into disrepute and makes ordinary compliant members of the public aggrieved and cynical about the partial manner in which some of our laws are applied, not least, as they believe, our taxation laws.
The motion to establish this new tribunal owes its existence to the McCracken tribunal and its aftermath. It is perhaps a frightening thought that all these matters would have gone unknown and uninvestigated had it not been for the private legal dispute between the members of the Dunne family, the raising of the payments issue in those proceedings and the subsequent disclosure of the Lowry payments to Sam Smyth for publication in the Irish Independent. By any standards, that is a highly improbable chain of events. It was far more probable in retrospect that these matters would never have reached the light of day.
There is every reason now to believe that the Dunne payments, substantial though they were, are but the visible tip of a much greater iceberg and that the true magnitude of corrupt and compromising payments was much greater. It seems unlikely that Mr. Haughey, when he sent out Mr. Traynor in pursuit of wealthy patrons who would bail him out of one of his financial crises, would have recalled him from that task as soon as Ben Dunne turned up trumps nor does it seem likely that Mr. Dunne was his first benefactor. If Mr. Haughey was prepared to compromise himself in relation to Mr. Dunne, as he was, the strong likelihood is that he would not shrink from doing so in relation to other wealthy businessmen.
The report of the McCracken tribunal has made plain what many of us for years could only harbour as suspicions, namely, that Mr. Haughey was a malign influence on Irish public life. While it is true that there was no evidence adduced of any attempt at a direct or indirect political payoff for Mr. Dunne's largesse, nobody but the most naive could possibly believe that being indebted to Mr. Dunne in the sum of £1.3 million did not create the circumstances in which corruption could take place.
It is also true that Mr. Haughey's political career was characterised by the attitude he exhibited in obstructing and misleading the tribunal and later in tendering false evidence to it. Truth never seems to have mattered greatly to Mr. Haughey. How ironic it is now, and how chilling, that when he escaped justice in 1970, his first instinct was to turn on his accusers and ask them to "take the honourable course". The truth is that the ascent of Mr. Haughey to political power was in large measure by questionable means. Many people were secret victims of his ambitions; some few were his public victims.
In the very precincts of this House, Mr. Jim Gibbons was kicked to the ground for standing up to Mr. Haughey. Other Deputies were confronted with explicit threats, not merely to their future in public life, but also to their private livelihoods, unless they bent the knee to his ruthless personal agenda. I was expelled from the party he controlled largely because I would not play the game his way. It was on me that the badge of "conduct unbecoming" was pinned.
I am by no means the only person who can rightly claim political vindication by the outcome of the McCracken report — there are many others, some of whom are still in public life. Others have left public life — by choice, out of disillusionment or involuntarily. There are also private people who have been victimised by the same ruthlessness in many other spheres of life. They found promotion blocked, doors closed and their competitors unfairly favoured. They suffered in silence.
Some may now ask why if I suspected all of this did I accept office in 1989 as a member of a Cabinet in which Mr. Haughey was Taoiseach. That decision was one of the most difficult of my political life, as I said at the time. The six Progressive Democrats Deputies in 1989 individually had every personal reason to have nothing to do with Mr. Haughey but we knew there was a great likelihood that if we did not take part in Government we would play into his hands and give him the overall majority he craved. We also knew it was impossible to support him from outside the Cabinet. We were, at the last, left with one option — to participate in Government on the basis of coalition and to influence from within the Cabinet that which we could not hope to influence from outside.
The Progressive Democrats have been criticised for some of the stances we took on issues of standards in that Government. History will judge whether we were right or wrong on each stance. Because we had entered Government with the gravest of misgivings concerning Mr. Haughey's standards and methods, we had to be absolutely determined to prove that we would not compromise ourselves in relation to those standards or methods. We took the two leaders that Fianna Fáil successively chose and we dealt with them, but we refused to compromise on our beliefs in what should and should not be done. In the end we left that Government because the then Taoiseach, Deputy Albert Reynolds, made it impossible to stay.
This brings me to certain aspects of the beef tribunal that disturb me, in particular the State's involvement and attitudes. A completely unwarranted adversarial procedure was adopted as opposed to an inquisitorial role. The manner in which the State legal team, acting on the instructions of the then Attorney General, Mr. Whelehan, conducted its case was disquieting. Those who made allegations, as they were called, were treated with hostility by the State and strict proofs of everything were demanded from them. Large sums were expended by the State on public relations and economic consultatants in an effort to disprove or discredit the evidence of a Minister which did not suit the State in the guise of the personal and political interests of two successive Taoisigh, Mr. Haughey and Deputy Albert Reynolds.
With what we now know from McCracken, is it unreasonable to suspect that substantial payments may have been made to win favours in political decisions concerning the beef industry, including State aids and State export credit insurance? The evidence of favouritism was overwhelming. What was the explanation for the illegal Government decision to overrule the IDA's conditions relating to the Goodman organisation?
Having seen what transpired at the McCracken tribunal, I am driven to the conclusion that Mr. Haughey was in receipt of substantial payments from several wealthy persons. His lifestyle and growth in personal wealth can only be explained in that way, as far as I can judge. The real question is not just the fact of payments, although that is important, it is the identity and motives of the paymasters. Others, however, may not co-operate as Mr. Dunne did. It may not be possible to trace all the payments. I have reason to suspect that the use of cash may have played a part.
When one recalls that in relation to the Ballsbridge Telecom Eireann site, the inspector, Mr. John Glackin, reported that part of the proceeds was withdrawn in cash in the amount of £0.5 million by an accountant working for Dermot Desmond; that it was carried through the streets of Dublin and stored in Mr. Desmond's safe in a tennis holdall; that Mr. Desmond later claimed to have paid it to an elderly and infirm foreign resident called Probets; that this claim was disbelieved by Mr. Glackin and that Mr. Glackin concluded that it was paid to someone else, some serious questions arise.
To convert £0.5 million into legal tender cash required taking enormous risks. It could only have been done for an unlawful motive: to be a deniable payment to someone for a corrupt purpose or to be a deniable payment for tax evasion purposes. We must ask ourselves whether such risks would be taken merely for tax purposes. Is not the more obvious explanation that the money was needed for ultimate payment to someone who simply had to be able to deny it? There is a case for believing that the money was intended for such a purpose.
That payment may be just one of a series of dubious or corrupt transactions by, or involving, members of a golden circle of people who placed themselves above the law. If Ben Dunne could buy the friendship of a Taoiseach, then there were other well-known people with every reason to do the same. If Des Traynor could seek out Ben Dunne's largesse with such ease, it seems inconceivable that he did not seek out equal generosity among a small circle of wealthy people who rubbed shoulders with Mr. Haughey and whose fortunes could be considerably assisted by him. That is why it is essential that the next tribunal comes to grips with the real implications of the McCracken tribunal, namely, that the head of an Irish Government was secretly on the payroll of wealthy businessmen. That is why the Oireachtas must inquire into the matter through a tribunal. We will have some idea of the spider's web of favouritism and corruption strung across Irish society in recent decades when we find out which and why wealthy businessmen financed the opulent lifestyle of a Taoiseach; why an Irish bank forgave him huge debts; why he could count on large gifts to pay for yachts, houses, race-horses, furnishing and works of art, and how all of this went unnoticed and unchallenged by the Revenue Commissioners.
It is only by confronting the truth that we can demand accountability and remedies. The House will be healthier when we raise the blinds and open the windows. We can only purge and restore our democratic system by a good dose of sunlight and fresh air.
Some may think that Deputy Lowry is unfortunate to be involved in this affair. However, people make their own luck. The record shows that Deputy Lowry engaged in massive personal and corporate tax evasion; that he lied to the Revenue when he availed of the amnesty, against which he had voted; that he lied to the then Taoiseach about his tax affairs on appointment as Minister; that he lied to this House about his offshore accounts, and that he exposed himself to blackmail. In these circumstances it seems reasonable that his personal finances should be investigated to ascertain whether he has other accounts abroad, whether his lifestyle was supported by any unexplained income and to see if and how the discharge of his public duties was or might have been affected by such matters.
He claimed last December and again during the general election to have told this House "the simple, unvarnished truth". That turned out not to be so. He can only blame himself if the public now demands a thorough investigation of his financial affairs and conduct as a Minister.
One could make a case for a substantial list of matters to be investigated by this new tribunal. For example, a procedure developed under the Irish nationality and citizenship legislation of 1986 whereby citizenship by naturalisation could be given to those with close Irish associations. This came to be interpreted as providing Irish passports for those who made investments in Ireland. It appears that while Taoiseach Mr. Haughey directed all such cases to be brought to his attention, by the Department of Justice, presumably to make the decisions himself. This is the understanding of one of my colleagues. We know something of the circumstances in which a decision was subsequently made in respect of the Masri passports. It would seem desirable that the operation of this scheme from its initial use should be reviewed as it was clearly open to abuse. Only a proper investigation can definitively establish whether it was abused and by whom.
Some years ago a statement was made to the Garda by a Mr. Shanahan, an employee of Anglo Irish Beef Processors in Rathkeale, County Limerick. It appears that very little of this statement was used at the beef tribunal but it was used in a subsequent criminal trial of some of the Rathkeale employees. It was not controverted. It sets out in detail how intervention beef was regularly and systematically removed from intervention boxes and certain cuts reboxed in commercial boxes and sold in Ireland and Britain on the commercial market. The sale in this way of such intervention beef, the property of the Minister for Agriculture and Food as agent of the Commission, was illegal. The statement goes into considerable detail about how this was done and states that it was carried out in full view of agricultural officers from the Department who did not intervene to stop it. It states that the difference in the weight of the intervention boxes was made up with fat.
This conduct was carried out on a wide scale. Nobody in Rathkeale benefited in any way from the sale of the stolen meat. The only beneficiaries were the owners of the plant. Why were they never prosecuted? On occasion the benefit to them was up to £250,000 per month.
It is widely believed that what occurred in Rathkeale happened in numerous other factories in the same ownership. The amount stolen, therefore, from the Minister is potentially enormous. This is a major fraud to which an official blind eye was turned. In the context of these tribunals, both past and proposed, should we not ask why a blind eye was turned?
I formed the impression at the beef tribunal that there was collusion between the State's representatives and those representing the Goodman organisation. Their interests appeared to be the same. The State and Goodman were never in serious or prolonged dispute. The State was in vehement dispute with one of its own Ministers who disagreed with the Goodman approach and the favourable way in which Goodman was treated. Did this collusion predate and extend beyond the tribunal?
There are numerous instances of matters arising in the supervision of the beef industry by the Department of Agriculture and Food which give rise to disquiet. My disquiet is shared by, among others, the European Commission which has imposed fines on Ireland approaching £100 million for the Department's failures.
The release of securities for export refunds is a matter that requires examination. The manner in which it was handled by the Department was most unusual. My fear is that where securities were wrongly released the Commission can seek reimbursement by fining the Department. In other words, the Irish taxpayer will yet again have to pay while Mr. Goodman, who was wrongly enriched by the payment of the refund, is allowed keep his ill-gotten gains. These refunds mostly date from the 1987-9 period. Some fines have already been imposed.
Why is forgery of official documents by some officials of the Department of Agriculture and Food not a matter of concern? No officials were ever prosecuted, dismissed or even disciplined for forgery. It must, therefore, have been officially approved. Why was this? Why are the actions of the Revenue being examined in this tribunal and not the actions of the Department of Agriculture and Food?
As an individual I cannot provide all the answers but, as somebody who has carefully looked at this scene for several years, I can provide some of the questions. For too long part of the problem was that we would not even ask the questions. That is why we find ourselves in this unseemly pickle.
I record my thanks and appreciation, and that of my party, to Mr. Justice McCracken and his team for this landmark report. It is a model of clarity and common sense. It rescues our democracy from growing uneasiness that a small group of powerful and wealthy individuals had come to regard themselves as the beneficial owners of the State while nobody in authority was prepared to call a halt. We do not conclusively know the identity of those who have acquired or bought mastery of the system but the genie is out of the bottle. Despite ignorant comment to the contrary, the report of the beef tribunal was a devastating critique of the conduct of public affairs. How Ministers interacted with big business, civil servants, State agencies and with this House was subjected to public scrutiny for the first time. The issues included the economic well-being of one of our major industries, our reputation as a trading nation, the behaviour, competence and practices of our most senior politicians and the propriety of relationships between senior Ministers and a prominent businessman who was a major financial contributor to the political party of the Ministers concerned, a businessman whose stated objective before the tribunal was to persuade the Government of the day to confine enormously valuable State assistance to his own companies. All of this was immensely valuable but, where the beef tribunal failed, the public test is perhaps best expressed in the following comments of the Church of Ireland Gazette of 19 August 1994:
Throughout this report there is a reluctance to express opinions or pass judgment where the weight of evidence appears to warrant it. That reluctance allowed central figures to rush out exculpatory statements proclaiming their vindication.
No such reluctance is demonstrated by Mr. Justice McCracken. Ordinary people are most energised by his willingness to call a spade a spade. Mr. Justice McCracken knows a brazen liar when he sees one. He can spot a tax dodger at the same distance as Mr. Haughey can shoot duck on his estate. When something is plainly incredible, unbelievable, contrived or untrue, then the tribunal report calls it incredible, unbelievable, contrived or untrue. If the evidence is manifestly implausible, as so much of the evidence to the beef tribunal plainly was, then Mr. Justice McCracken calls it implausible. No matter how powerful the individual, how prestigious his residence or occupation or how large his house extension, there is no reluctance to express opinions or pass judgment where the weight of evidence warrants it. This will do much to reassure the public who pay their taxes as best they can. The rest is up to this House and to the independent organs of the State such as the DPP and the Revenue Commissioners.
When it did not prove possible to find corruption, Mr. Justice McCracken states as much but quite properly does not leave it at that. Mr. Haughey's entire lifestyle was dependent on the receipt of substantial gifts from business people. He was therefore in "a position of dependency" in relation to these wealthy individuals and if such a position were permissible "the potential for bribery and corruption would be enormous". Of equal importance is Mr. Justice McCracken's stated view that democracy itself can be corrupted by the perception that those who make the law are willing to break it. Within his terms of reference, there was little else Mr. Justice McCracken could do. Further action lies with this House. Perhaps it can be said that more consideration might have been given to the making of recommendations for the future.
The picture painted by Mr. Justice McCracken and by Deputy O'Malley's direct experience is a long way from Mr. de Valera's vision of a nation whose citizens might live in frugal comfort. What would Mr. de Valera have thought of the Gandon mansion, the estate with the roaming thorough-breds, the island, the fine wines and the yacht? A successor of Mr. de Valera posing as a country squire, a man of the arts, a man of the turf, a great helmsman who embodied the spirit of the nation and who was born in, or with an affinity to, a county in each province, a man who was the possessor both of the common touch and wealthy benefactors. The persona which Mr. Haughey affected, where Micheál Mac Liammóir meets the Great Gatsby, seemed to regard the huge private payments not merely as being permissible but as being the natural order of things. Just as the chieftains of ancient times lived off the fat of the land, our modern day warrior took it all as his due entitlement. Others, while almost certainly not knowing any of the details of Mr. Haughey's financial chicanery, also seemed to regard it as the natural order of things. This was the high point of the new political culture ushered in when the men in mohair suits took over from the men with no arses in their trousers.
Charles J. Haughey was the arch-practitioner of the new culture in a party where only a few rebelled and a majority willingly did his bidding. Since Mr. Justice McCracken's report, we have been treated to several images of an oppressed Cabinet where grown men and women cowered like children, dreading the footsteps of a drunken, tyrannical father.
Máire Geoghegan-Quinn, writing about his volcanic impatience, tells us that Mr. Haughey "created a largely anonymous force of high energy individuals bonded to him in a conspiratorial collegiality". The only thing one can say about that is that it lets most of the Cabinet off the hook. Lest it does not, Mrs. Geoghegan-Quinn goes on to explain that there were "degrees of closeness to him". There were the people, she said, who had visited Kinsealy only once, which included Mrs. Geoghegan-Quinn on one occasion for just a half an hour according to herself, and there were the people who had "spent the evenings at the bar in Kinsealy". The latter group she says were "the real insiders. they were the ones who must have been conscious of the distance between income and spend. The rest of the party had little sense of the scale of the art collection, the good wines in the cellar or any other evidence of great wealth". Whatever about the fine wine, the purpose here is clearly to put enough clear water between the columnist and the grand old villain. In any event, Mrs. Geoghegan-Quinn demonstrated her independence by continually talking to Deputy O'Malley during divisions. This unparalleled bravery must be viewed against Mrs. Geoghegan-Quinn's memory of watching "senior Ministers trembling after Haughey had erupted at them and see them later rush to be near him much as a beaten dog returns to its master"— what an enduring image. This is how the former Minister for Justice characterised those who served with her under Mr. Haughey's rule, the present Taoiseach, Deputy Ahern, Ministers Burke, O'Rourke, Woods, Brennan, Walsh, Deputy O'Kennedy and others. I accept that only those who were called to the bar at Kinsealy can say if former Deputy Geoghegan-Quinn's characterisation is fair.
The refrain has become all too familiar "I am clean because I really didn't know him that well and I don't have a wine cellar in the house". This refrain fundamentally misunderstands what is at issue. It is not being suggested by anybody in this House or outside of it that when the wine merchants were finished replenishing stocks at Kinsealy they were then despatched to fill up at Athlone, Renmore or Drumcondra with the bill being forwarded to Des Traynor. The issue is what decisions other Ministers colluded in which they knew, or suspected, were wrong. Did anyone object to the Carysfort deal? Did anyone question why countless millions in State aids were conferred on one beef company to the disadvantage of others? Why was the IDA unlawfully pressurised to help Mr. Goodman? Why was up to £200 million of public money put at risk to underwrite beef deals with the Saddam Hussein regime for what Mr. Justice Hamilton found to be "no economic benefit" and when much of the beef was not even Irish? Did anyone query the manner of the acquisition of the lands and the manner of the awarding of contracts for the IFSC? Did anyone get curious about who was signing the passports for sale, to whom and why were they being sold and for what benefit? It appears that when the Masri affair flared most Ministers in Haughey Governments did not even know of the existence of the passports for sale scheme. When one financial guru sought to justify a fee of £2 million for the Pernod Ricard case by claiming that he had used up his political clout at the highest level, did any serving Minister raise any questions about this?
What questions were asked about the Telecom affair? Can the Taoiseach tell the House whether the last minute amendment to the 1994 Finance Bill, introduced by him in respect of provisions relating to the residence of individuals in this State for tax purposes, was designed to help certain wealthy individuals, at least one of whom was connected to the Telecom controversy and who was disclosed to have substantial funds in an offshore account on which significant taxes ought to have been levied?
Throughout all these controversies we did not hear one word of criticism about the conduct of the main players from any senior figure in Fianna Fáil. When in Opposition, the Progressive Democrats had no doubts about the reason this was the case, as their then Finance spokesperson, Michael McDowell, made clear in the Goodman debate of 2 September 1994. He stated:
We have never heard it and I dare say we never will because the reality is that they were bought and stay bought. They know that Goodman knows where the bodies are buried; they dare not even rebuke this man because they know in their hearts that he has information on them and that he would bring them down like a group of skittles if the truth ever emerged.
That was the Progressive Democrats in Opposition. In Government there are two positions — one fomented in the experience of Deputy O'Malley and the other in that of the Leader of the Progressive Democrats, the Tánaiste, Deputy Harney, who sees no evil and hears no evil these days. For a politician whose antennae were so sensitive to scandal in Opposition, this is quite remarkable. Every morning she does a rain check with the Taoiseach that everything is well with the world and then faces into the day personally fortified.
It is the task of this House to agree the most appropriate terms of reference for a new tribunal of inquiry. It is not the business of this House to tell the tribunal how to go about its duties. However, the terms of reference are designed to flush out Mr. Haughey's other benefactors and then examine in detail certain transactions, some of which have been adduced in the debate so far this evening. It may be helpful to suggest that Mr. Lawrence Goodman, Mr. Dermot Desmond and Mr. Pino Harris be invited at the outset to submit statements to the tribunal setting out, in the context of the terms of reference, whether they can be of assistance to the tribunal. All three have been involved in controversial transactions during Mr. Haughey's time as Taoiseach, and a vivid one has been presented to the House this evening by Deputy O'Malley.
Having acknowledged that the Government has come some way to meet the Opposition parties in the matter of the terms of reference, there remains cause for concern. I acknowledge that the Government has come some way to meet the Opposition parties. This is a fair effort by the Government and the direction of what it is seeking to do is right, but there are some specific matters with regard to the terms of reference about which concern still exists. First, there is the important matter of the preliminary investigations being held in private rather than being left to the discretion of the tribunal. Second, there is no explicit reference to certain controversial transactions which prima facie would seem to warrant investigation. Third, it would appear that the Ansbacher accounts may only be investigated as they relate to Mr. Haughey. This last restriction in particular seems to be mistaken. Whereas the argument in respect of the reason these accounts as they relate to a former Taoiseach must be investigated is clear, why should other wealthy Irish residents suspected of tax evasion escape scrutiny?
The paragraph providing for an investigation of how the Revenue Commissioners availed of their powers in respect of Deputy Lowry and Mr. Haughey will provide comfort for tax compliant citizens who are puzzled as to how such conspicuous consumption could have been paraded for so long. The question arises, however, as to whether the compliant taxpayer is expected to acquiesce in the non-investigation of certain wealthy figures suspected of tax evasion but who happen not to be politicians.
The focus inevitably in the debate today, in the commentary in the media — I have not yet heard it — and in the print media tomorrow will be on politicians, but the ordinary taxpayer finds it difficult to understand how one accountant working for one small bank could assemble a portfolio of £38 million, salted away offshore presumably, and, in the case we know of, evade tax. That is not to be inquired into in full. We have an amendment before the House in this regard. Mr. Justice McCracken was not in a position to conclude that all of that £38 million is evading tax but he clearly stated that the motives of some of those depositors are questionable. If one is in public life and making laws in this House, and one breaks laws, it is obvious why that ought to be inquired into, but what if we cannot inquire into a particularly wealthy individual who, for example, might have accumulated some money from illegal purposes and salted it away in the same Ansbacher accounts? I suggest to the Minister for Finance and the Taoiseach, who has been quite forthcoming in the discussions he has had with the other party leaders, that this should be examined. Why the narrow focus? Why restrict the investigation of the Ansbacher accounts as they relate only to Mr. Haughey? That matter must be dealt with.
I am also concerned about public administration and administrative action in relation to the Ansbacher deposits. In particular, will the Minister for Finance tell us what the Central Bank knew about this matter? The disclosure that at one stage the deposits comprised almost 35 per cent of the liabilities of Guinness and Mahon Bank would appear to breach the Central Bank's licensing and supervision requirements and standards for banks. I ask the Minister for Finance or the Taoiseach to reply to this question and in particular whether rules 16, 17 and 18 of the supervision requirements and standards were breached. Is the Central Bank satisfied that it acted in conformity with rules 7 and 10? Given what is contained in the 11th and 12th schedules of the McCracken report it would seem there are serious questions about the functioning of the regulatory and supervisory system. There would appear to be serious questions hanging over the role of all the directors and senior management of Guinness and Mahon, both from the point of view of banking law and regulations as well as under the company law code. Will the Taoiseach say if it is the case that it was the Guinness and Mahon internal auditors in London, and not the Irish management, auditors or authorities, who blew the whistle? We know now that Innisvickillane was not the only offshore island of interest to Mr. Haughey. We know now that Mr. Bernard Dunne was not Mr. Haughey's only benefactor, although it is possible that he gave better value than the others.
The preliminary task of the new tribunal is to uncover the identities of the other main benefactors who kept Mr. Haughey in the style to which he had become accustomed. In this regard I must express serious reservations, as we have done in direct discussions with the Government, that as the terms of reference now stand these preliminary investigations will be carried out in private. I cannot understand why the words "in private" have been inserted and why the matter cannot be left to the discretion of the tribunal. It was left to the discretion of Mr. Justice McCracken and that worked quite well.
In his contribution to the House this evening the Taoiseach set out an explanation for the reason the sifting process at the preliminary investigation stage is being conducted in private. He stated: "This merely reflects what has become the practice of tribunals in that before taking the oral evidence, counsel for the inquiry, at the direction of the chairman of the tribunal, undertake the collecting of evidence relevant to the tribunal by means of the issuing of orders of discovery or letters of request to examine the witnesses abroad".
The Taoiseach said it has become the practice to carry out this sifting process or preliminary investigation in private. It worked well in the case of McCracken but none of us who was closely involved with the beef tribunal would say it worked particularly well there. Deputy O'Malley dealt with this at some length and I spoke on it for two hours the day the ceasefire was conveniently called in September l994. If this is the practice then why insert for the first time the words "in private"? Why not leave it to the discretion of the judge? If the tribunal has had that discretion up to now — and it has worked well at least in the case of McCracken — then why not leave it to its discretion in this case also?
This raises the question already raised by Deputy John Bruton about the membership of the tribunal. His words are on the record and perhaps they carry more weight than if I said them. However, I wish to underline one aspect of what he said, if it is true that the Government is contemplating the appointment of two or three members to the tribunal then it should think again. The sole member of the tribunal in this case worked very well. It also worked very well in the case of Finlay and the hepatitis C issue. I counsel that the Government should make available to the sole member of the new tribunal technical expertise, for example, in the form of a chartered accountant who has no conflict of interest. It does not appear to be easy to find such a person in this small town but I am sure such a person exists. The Minister for Finance is better placed than most to run down through a list of names. If progress is to be made in carrying out the very difficult job we are entrusting to the new tribunal then technical expertise should be put at the disposal of the tribunal.
The euphoria about the McCracken tribunal is partly due to the shock of finding a judge who calls a spade a spade and is prepared to draw sensible common sense judgments and informed opinion, which was not our experience in the case of the beef tribunal. There is a euphoria outside this House that because McCracken was successful the next tribunal, McCracken Two, will automatically be successful. I am afraid this does not follow. The chances of getting the same kind of entrepreneur benefactor with the same eccentric proclivities as Mr. Ben Dunne are not too high. There was a story in the public press about an attempt to nobble Mr. Dunne. I do not know if that happened but I would not draw the conclusion that every benefactor will be as forthcoming as was Mr. Dunne in this case.
I welcome the Government's acceptance at paragraph (k) of the proposal by Democratic Left that the tribunal be asked to make whatever recommendations it considers necessary for the reform of company law. Whereas the focus has been almost exclusively on politicians and the purchase of political influence, once again the McCracken report gives rise to serious questions about compliance and the adequacy of company law.
It also gives rise to serious questions about the conduct of some professionals. Yesterday's move by the Institute of Chartered Accountants to get its retaliation in first simply does not impress. The well timed announcement that "several accountants are to appear before a disciplinary committee due to be set up later this month" arising from McCracken is of some interest but I counsel the House not to hold its breath. When various kinds of skulduggery were unearthed by the beef tribunal what action was taken by the Institute of Chartered Accountants of Ireland? The answer is none.
It is not only the company law provisions governing the actions of directors and executives of companies which require examination but also of accountants and accounting firms in their role as auditors, financial advisers and consultants and the accountancy profession representative organisations as self-regulatory bodies. For example, in regard to the relationship between Mr. Dunne and Mr. Lowry and their companies the tribunal concluded: "It is clear that once the overall contract was agreed Streamline Enterprises existed for one purpose only, namely to perform the contract with the Dunnes Stores group". Critically it went on to report that: "It was agreed that Streamline Enterprises would make a small profit which was envisaged as between £20,000 and £50,000 per annum". This picture makes a mockery of the theory and conventions of accountancy which is that company accounts convey an objective picture of a company's affairs. What it conveys is a picture of company executives sitting down together to fabricate a fiction, the declaration of a small profit. This raises profound questions about the behaviour of the financial director and the common auditors of both Dunnes and Streamline. The provisions of section 94 of the Finance Act, l983, are absolutely relevant here.
At least three issues arise. The treatment of the Faxhill Homes refurbishment raises questions in relation to the behaviour of Mr. Dunne and his financial controller from the point of view of section 94 of the Finance Act, 1983. Again there are implications for Mr. Dunne from the point of view of his responsibilities and duties as prescribed under the company law code. In the aftermath of two inquiries into major indigenous Irish enterprises, Goodman and Dunnes, it is difficult to avoid putting the question to Irish business whether these revelations suggest a mode of behaviour in the Irish business community and also among the regulatory professions, in particular the accountancy profession, that calls for deep examination.
Tax evasion is not a victimless crime. Deputy Lowry's conduct has let him, his party and this House down. It is not a defence to say that "if I had not entered the public realm everything would be fine and I would today be a wealthy businessman". However, it begs the question, how many other suppliers had Mr. Dunne in a similar bind? A further tribunal is painfully necessary to show that our democracy cannot be purchased no matter how impetuously generous the supermarket owner, no matter how dominant the beef baron, no matter how exotic the offshore accounts of the financial guru, no matter how many Japanese trucks are imported or how many race horses are trained or how many acres rezoned.
It is still an honour to be elected to this House and a privilege to participate in the making of laws which are intended to apply equally to all of our citizens. A further tribunal is necessary to keep faith with the citizens of this Republic who do their best to pay their taxes. They need to be reassured that there is not one law for the rich and a different law for the rest. If a Member of this House is for sale there is nothing we can do to prevent him finding a purchaser if he is determined to do so, but by our words and actions we can demonstrate our conviction that Dáil Éireann will not become the play thing of any puppet master, elected or unelected. We can demonstrate this conviction not merely by a determination to purge the wrong doing of the past but by the rules we establish for the conduct of our affairs, how accountability for decisions of the Executive will operate and how the political process is funded.
There are three Charlie McCreevys speaking in the debate today on the issues before the House. One of them is the Minister for the Finance who carries responsibility for the Revenue Commissioners, for exchange control and also for certain institutional aspects of the recommendations of the McCracken tribunal. Another is the elected representative for the people of North Kildare. That constituency and others have benefited from the upsurge of economic activity and the rising standards of living which flowed from a process begun by Fianna Fáil in 1987 and broadly pursued by various Governments since that time. My constituents want the upward spiral of economic betterment to continue and my responsibility to them requires me to approach the issues raised in this debate in a way which ensures that what is said in, and done by, this House does not inadvertently jeopardise what we have gained from the transformation of our economic status or what we stand to gain from its continuance.
Finally, among the Members of this House, I was probably the most assiduous critic of the acts, omissions and political approaches of one of the two former office holders who are the subjects of the motion before the House. It is no secret that I was a long-standing critic of Charles Haughey, on one occasion being suspended from the Fianna Fáil Parliamentary Party for a brief period for voicing my opinions freely. I was never intimidated — perhaps I was meant to be. I lived with my principles on the backbenches for all of C.J. Haughey's reign as leader of Fianna Fáil. Life for a backbencher who regularly challenges the leader or the leadership style of a parliamentary party, whether in power or hoping shortly to attain it, is never easy. That is not unique to this country, to Fianna Fáil or, in all honesty, to Charles J. Haughey. Hannibal set out over the Alps with his convoy of innumerable elephants to mount a challenge in the plains. I did the political equivalent during Mr. Haughey's leadership, but when the day of battle dawned only a band of stragglers remained and I was routed.
The prospect of some day dancing on the political grave of a triumphant adversary may at times provide the motivation to survive the black night of a backbencher so circumstanced or the incentive to hold on to life in a parliamentary gulag. If today that opportunity has come, I would willingly forego it. I feel only sadness and regret at the shadow which recent discoveries have cast over so much achievement by a man who for so long dominated this House, and at the devaluation in the public mind of his sustained contribution to the public good.
It has been argued that the press and the media were remiss in not pursuing certain issues; that they were subservient to, or soft on, Charles J. Haughey. Remiss they and we may have been at times but let us not forget two things. Outside the limited area of personal finance, the general thrust of the media over several decades ranged from outright hostility to acknowledgement tinged with begrudgery or innuendo where both Charles J. Haughey and the Fianna Fáil Party were concerned. Let us remember that there exists a category of media which is uninstitutionalised, unaccountable but tremendously effective — the medium of rumour and of pub talk — which can carry clout within this State beyond the wildest dreams of an ambitious press baron.
My grounds for dissent were twofold. I had expected Mr. Haughey, when he took over as Taoiseach, to call a halt to the profligacy of the 1970s, which created some of the mountain of debt which we face today. After a brief pause in 1980, when we were eloquently told that as a nation we were living beyond our means, the rake's progress was resumed and the mounting debt further compounded. The same has to be said of his Fine Gael and Labour successors up to 1987, despite their equally fine rhetorical opening.
My second ground for dissent was a disagreement with an old style of authoritarian leadership which seemed to demand and reward unquestioning loyalty and obedience, once summed up by a good friend of mine as uno duce, una voce. Despite its apparent revival in certain other jurisdictions, I do not believe it is appropriate to a modern democracy. Political wisdom does not reside solely in one place. The appropriate course of action in given circumstances needs to be argued through openly and debated in a free atmosphere before collective decisions are taken and supported.
I would like to acknowledge some of Mr. Haughey's more lasting achievements. In his support of Ray MacSharry in 1987 and 1988, he succeeded in putting the economy and the national finances back on a sound course and working with Deputy Bertie Ahern as Minister for Labour he secured the support of the social partners for this. Since the decisions taken in the late 1980s, the economy has never looked back. The only pity is that they were not taken much earlier.
I also pay tribute to the success of his diplomacy with EU Commission President, Jacques Delors, which led to the first round of Structural Funds on a hitherto unknown scale. His successors were able to build on this in the second round in Edinburgh. Imaginative institutions such as the Financial Services Centre and Temple Bar have helped transform the city, not to mention the major contribution of the IFSC to the Exchequer. As a former Minister for Social Welfare, I am conscious of what he did for the elderly. None of this detracts from the serious position which we are now facing or provides a defence for the matters investigated by the tribunal. In recalling his undoubted service to the State, we must equally in other matters before us today "nothing extenuate".
Our success as a small nation in a world of competing economies depends on the economic policies which we pursue, the industry and skills of our people and our industrial relations climate. Everyone would accept that, but it is equally and increasingly dependent on the reputation and credibility of our institutions. Various organisations produce league tables of countries in terms of their comparative institutional probity. We rank high on those tables, a fact which influences decisions on investments, job location and the purchase of our products.
What has been disclosed before Mr. Justice McCracken may well have caused some slight slippage in our position on those league tables and, in consequence, created a less benign perception of us in boardrooms across the world. Let us not, through over-reaction or the quest for partisan advantage, set in train arrangements which, on the basis of nothing more than rumour or hunch, will alter our standing as an investment destination or make life more difficult for Irish companies.
If there is corruption or wrongdoing in our public life, let us set out rationally and clearly to locate and eradicate it. Surgery is sometimes essential to the health of the body politic, but we must not give vague rumours, pub talk or malicious allegations a status they do not deserve by embarking on a series of investigations for which they alone provide the fuel. Exploratory operations weaken the healthy. We should not embark on them unless some sound diagnosis precedes them. That is the approach the Government is proposing in this House today. Our motion equips a tribunal to investigate specific material which has come to light from Justice McCracken's investigation and enables that new tribunal to determine, where it sees a prima facie case for the investigation of connected matters, to pursue whatever lines of inquiry it thinks appropriate.
The success of the McCracken Tribunal, the speed with which it was completed and the succinctness of its findings should not blind us to the fact that previous tribunals have taken much time and resulted in findings which did not always allay public disquiet. Wide-ranging terms of reference for a tribunal may require a cast of hundreds of witnesses and the gap that can arise between the taking of evidence on a particular matter and the publication of findings can create difficulties for persons and businesses which are called to provide evidence even where the findings exonerate them.
I know from my time as Minister for Tourism and Trade that foreign competitors are not slow to exploit this situation to the detriment of Irish businesses. The formula which the Government has put before this House, and which factors into the terms of reference a stage of preliminary investigation in which the procedure and reporting arrangements will be substantially at the tribunal's discretion, is designed to minimise the danger of damage to individuals or firms from unwarranted public attention.
I will deal with two aspects of the report of the tribunal, namely, the findings regarding tax evasion on the part of the individuals concerned and the recommendation that candidates for the Dáil and Seanad should be "tax cleared".
The pursuit of the tax affairs of the individuals in question and any individual in the State is a matter solely for the Revenue Commissioners. The Minister for Finance does not get involved in such cases for obvious reasons. This is the position which has been accepted in the House since the foundation of the State. I understand that my predecessor, Deputy Quinn, on radio recently entirely endorsed that position.
The Revenue Commissioners have already made it clear, following the tribunal report, that any action needed to uphold the implementation of the tax code in the light of the information contained in the report is being taken. This does not prevent me from expressing a view on the total unacceptability of tax evasion no matter who engages in it. This unacceptability is all the more reinforced when the persons accused are, or have themselves been, lawmakers passing laws to levy and collect such taxes. Nor am I prevented from seeking a review by Revenue of their existing powers, which are substantial, in the light of the findings of the tribunal.
Immediately on publication of the report, my Department requested the Revenue Commissioners to carry out such a review in conjunction with the Department of Finance. If additional powers are required and these are shown to be desirable and likely to be effective they will be included in the Finance Bill.
I will briefly refer to what the leader of the Opposition, Deputy John Bruton said in the course of his address relating to the tax amnesty of the 1990s. He said:
These accusations of tax evasion were publicly known to be before the beef tribunal in 1993 when the then Minister for Finance, Deputy Ahern, drew up the detailed terms of his tax amnesty. The justification for this unjust amnesty was that it was supposed to bring in unknown potential tax liabilities. The then Minister knew that the Goodman Group had been accused of tax evasion before the beef tribunal. This was a known potential tax liability, not an unknown one. Despite this knowledge, he carefully drafted the tax amnesty provisions of his Finance Bill not to exclude firms from eligibility even though the taxes which might have been evaded were the subject of investigation before a tribunal.
Perhaps Deputy Bruton, or someone on his behalf, has inadvertently made an incorrect assumption in researching his speech. The tax amnesty Bill known as the Waiver of Certain Tax, Interest and Penalties Act, 1993, was commented upon following the publication of the beef tribunal report. The Revenue Commissioners then issued a statement on 4 August 1994 which stated:
In view of comments and speculation in the media arising from the references to the tax liabilities of the Goodman Group in the report of the beef tribunal, the Revenue Commissioners wish to clarify certain matters relating to the tax amnesty.
The relevant legislation provided essentially for two types of amnesty. The first amnesty did not apply to companies. It allowed individuals to settle their tax affairs by paying 15 per cent of the relevant income or gains. The second, or general amnesty applied to both individuals and companies. It allowed them to settle their liabilities by paying all outstanding tax in full. They did not, however, have to pay interest or penalties.
In order to avail of the general amnesty, the taxpayer had to pay the full amount of tax in question by 14 January 1994.
Perhaps Deputy John Bruton and his advisers were misled on this matter. From my professional knowledge, I can assure him the incentive amnesty, which the hullabaloo concerned, did not apply to companies, as is referred to in the Revenue Commissioner's statement. The Revenue Commissioners found it necessary, immediately on publication of the beef tribunal report and following comment in the media, to issue that statement. What Deputy John Bruton said tonight is incorrect in so far as it relates to companies. He said then Minister for Finance, Deputy Ahern, carefully drafted the tax amnesty provisions of his Finance Bill not to exclude firms from eligibility. This is incorrect as regards the incentive amnesty. The Revenue Commissioners issued its statement to explain the position, which upheld what was in the tax amnesty of 1993. The incentive amnesty did not apply to companies, which I and most accountants would know.
The last major change in revenue powers was given effect in the 1992 Finance Act, brought in by the current Taoiseach when he was Minister for Finance. The principal new powers were; the provision on an automatic basis of "third party" returns to revenue by certain persons receiving income on behalf of others, or persons making payments to, or on behalf of, others, for example, letting agents, traders making payments for services, persons receiving income belonging to others — such returns were to be made previously only on request by revenue; reporting arrangements for domestic institutions in relation to the opening of foreign bank accounts by Irish residents; extra powers for revenue to enter business premises to search for and examine or remove tax records; powers for revenue, when dissatisfied with the tax accounts of a taxpayer, to seek details from business suppliers or customers; increased powers for revenue, when dissatisfied with the return, to require a person to give a statement of affairs showing his or her assets and liabilities; wider powers of attachment of amounts owed by a third party to a taxpayer who has defaulted in paying tax; the introduction of tax clearance requirements for pub licences which extended to other excise licences, for example, betting shops, in the Finance Act, 1993; new penalties to counter the destruction, defacement and concealment of business records and books and imposed minimum mandatory fines in certain circumstances, and extended inspection powers for revenue in relation to tax records and in particular in relation to computer records and accounts. Members of the House may recall there was a considerable outcry, both in and out of the House, against the then Minister when he introduced these provisional measures in the 1993 Act. Many people were disconcerted and said the powers went too far.
The powers were further extended in 1993 and penalties for tax evasion were significantly increased, in conjunction with the introduction of the tax amnesty. In relation to bank accounts, the Revenue Commissioners are empowered to seek access through the courts to the bank accounts of named individuals resident in the State.
I understand from the Revenue Commissioners that the existence of these powers is an important factor in underpinning voluntary compliance with the tax laws by the vast majority of taxpayers. Where necessary, the powers are formally brought into play by revenue in support of their investigations. It is important that the right balance be maintained so that adequate powers are available and their use is targeted mainly on those actually evading tax.
I know the Revenue Commissioners have been active in recent years in streamlining their operations to facilitate pursuit of tax evasion. A large number of staff has been placed on audit and investigation work. In 1996 this work yielded £133 million in tax receipts. I know from personal observation, and I am sure the House knows, that Revenue have transformed their whole approach to tax administration in the past ten years and how this has played a significant part in the increased tax revenues we are now experiencing. We should compliment Revenue for the professional and practical approach they take and for the way they have made the changes to tax collection and administration in recent years.
I have been informed by the commissioners that in keeping with their commitment to show they are tough on tax evasion, Revenue has designed and put in place arrangements to secure a more effective prosecution policy. As part of this a prosecution policy unit established during 1996 now directs the approach to prosecution of tax cases and provides guidance and support to the field officers. Officers have been trained during the year in matters relevant to criminal investigation, in particular on the evidential requirements to achieve a successful prosecution. Under the new arrangements some cases will now be handled by Revenue without the involvement of the Garda. A number of such cases have already been reported to the DPP and court proceedings have been initiated.
I acknowledge the part played by my predecessor, Deputy Quinn, in promoting a number of these changes and in making clear his interest and concern that more resources be devoted to the prosecution aspect of serious tax evasion cases. I too have made it clear to Revenue that the recent innovations should be developed and built upon. It is important to be able to show clearly to people who obey the law that those who do otherwise in their tax affairs will face a real and imminent possibility of prosecution.
Turning to tax clearance for individual candidates for Dáil and Senate elections, the Government accepts the tribunal's recommendation on foot of a proposal put to the tribunal by counsel for Fianna Fáil. Tax clearance is already widely used for applications by individuals or companies for grants of more than £500 from the State and for the issue of licences such as excise licences. It also applies to awarding of public sector contracts exceeding £5,000 in any 12 month period. My Department has asked the Revenue Commissioners, who administer tax clearance, to examine the practical aspects of applying tax clearance in the case of Dáil and Senate candidates. Such practical issues relate, for example, to the information or declarations to be required from applicants and the time schedule which would be involved for applications, given the limited time before an election in which tax clearance will be sought. I am sure both Houses will wish to debate this proposal in detail when legislation comes forward to give effect to it.
On the exchange control issues raised by the tribunal report and referred to by Deputy Rabbitte, the report said two payments were made into Isle of Man bank accounts by Mr. Ben Dunne for the benefit of Mr. Michael Lowry. It said "these accounts were opened and the monies paid in this way with the intention of enabling Mr. Michael Lowry to have money in an offshore account, contrary to the exchange control legislation then in being, and to assist him in evading tax". It made no such statement about the payments to Mr. Charles Haughey.
Exchange controls existed here under the Exchange Control Acts, in force from 1954 to 1992. Exchange controls were fully in force until 1988. In that year a process of liberalisation was initiated, which eliminated all exchange controls by the end of 1992. Exchange controls were directed at transactions which involved the transfer of funds either to or from the State which did not relate to normal travel, trade or other commercial activities. Irish residents were not permitted to hold offshore accounts without specific authority.
On Monday, 25 August 1997, the day the report was published, my Department wrote to the Central Bank, to which in 1965 day-to-day administration of exchange controls was delegated on behalf of the Minister for Finance. The Central Bank was asked to instigate a detailed investigation of the issues raised by the report in its references to exchange controls. My Department asked that the report of this investigation be conveyed to it as soon as possible. Contacts with the Central Bank in recent days indicate that, in view of the volume of records to be examined and the need for the Bank to consult a number of banks, the process will take some time. However, the Central Bank has informed me it hopes it will be possible to send a comprehensive reply to the Department by the end of this month.
If the Central Bank finds that apparent breaches of exchange controls occurred, my Department will then send the papers to the Director of Public Prosecutions for consideration as to whether proceedings on indictment should be initiated.
On the institutional front, the tribunal felt that rather than have a new institution investigate breaches of the Ethics Act, that task might be entrusted to the Ombudsman. While I have every sympathy with Mr. Justice McCracken's anxiety to avoid the creation of yet another organisation, I must admit to some doubts about the appropriateness of assigning that task to a single nonjudicial office holder whose office has a radically different basic function. The Government has already signalled its intention to establish a Public Ethics Commission and its precise form and powers will be set out in legislation which I will shortly put before the Government.
In the past, passionately held views on the Constitution and external relationships of this State divided our people. In the absence of such fundamental divisions, it is probably inevitable that personality should now provide much of the focus for political discussion in this House or in the country at large. Nevertheless, the level of personal as distinct from political antagonism in this House has been mercifully low in my years here. The work we are doing today is unusual in that it requires all of us to acknowledge circumstances which may call into question the personal actions of two men who served with us in this House. Most of us are grateful the task of sifting the evidence and reaching a conclusion on it falls, quite properly, to an independent tribunal. My colleagues and I believe the mandate we are giving to that body is crafted, as far as is humanly possible, to ensure a fair and prompt conclusion and to provide both Deputy Lowry and Mr. Charles Haughey with every opportunity to vindicate their names which stood high in the esteem of this House.
As many people in the House have said, the Honourable Mr. Justice McCracken has done an excellent job. This House owes him a debt of gratitude. I thank the members of the legal team who assisted him, the registrar of the tribunal and the administrative staff. The report is a model which I have no doubt will be emulated by those who have the onerous task of drawing up reports of any other tribunals which the Houses of the Oireachtas may put in place.
The terms of reference drawn up by the rainbow coalition Government, and in particular the input of the Attorney General to that Government, Mr. Dermot Gleeson, have had a major bearing on the efficacy of the McCracken tribunal. Comparisons have been made between the McCracken tribunal and the beef tribunal and their respective reports. The key difference was in the terms of reference. The beef tribunal's terms of reference were broad and ill-defined. The terms of reference given to Judge McCracken were focused and measured. The then Government decided what precisely it wanted the tribunal to investigate and because the tribunal and its personnel had a clearly defined job they were greatly assisted in the performance of that task by the riding instructions they received in the terms of reference.
We should all remember that in the course of this debate. It is almost a rule of tribunals that their efficiency and success will be in direct proportion to the clarity of the terms of reference under which they operate. I will return to this issue later.
The McCracken report established that Mr. Ben Dunne made payments both to Mr. Haughey and Mr. Lowry. It established the manner in which these payments were made. It established that the payments made to Mr. Lowry were payments for work carried out by him for Dunnes Stores. There was no commercial relationship, however, between Mr. Haughey and Dunnes Stores. The payments made by Mr. Dunne to Mr. Haughey originated from Mr. Dunne's generosity.
The McCracken tribunal also established that in the cases of both Deputy Lowry and Mr. Haughey no evidence exists that either acted in office to confer any favours on Mr. Dunne or Dunnes Stores as a result of the payments made.
The report paints an appalling vista of the former Taoiseach, Mr. Haughey, receiving huge sums of money to support his extravagant lifestyle. It shows how these sums of money were channelled through offshore accounts and how Mr. Haughey denied all knowledge of this until the tribunal had established independently that he had received the sums of money claimed by Mr. Dunne and in the manner described by Mr. Dunne.
The tribunal has left much unfinished business. It has not, however, dodged any of the issues and it indicates clearly what must now be done. It states in the most unambiguous terms that Mr. Haughey obstructed the work of the tribunal. It states quite unambiguously that the tribunal does not believe Mr. Haughey's evidence. Most importantly, it has referred the report to the DPP and has requested the DPP to adjudicate on whether Mr. Haughey has committed an offence under section 1(2) of the Tribunal of Inquiry (Evidence) Act, 1921 as amended by the Tribunals of Inquiry (Evidence) (Amendment) Act, 1979.
In respect of both Mr. Haughey and Deputy Lowry the report makes it quite clear that there is prima facie evidence of tax evasion and that the Revenue Commissioners have an obligation to investigate the financial affairs of both men. It is quite clear also from the McCracken report that Judge McCracken does not regard this as the end of the affair. While he does not specifically recommend another tribunal to move forward from the destination at which he has arrived, it is clear from the tone of the report that he believes a new tribunal is necessary.
I welcome the Government's decision to set up a second tribunal. I also welcome the consultations which the Government had with Fine Gael regarding the terms of reference.
We agree with the broad thrust of the terms of reference. We want terms of reference which are sufficiently focused to ensure that the tribunal's work is carried out as efficiently as that of its predecessor. However, they must also be wide enough to ensure that all the matters of public concern which arise from the McCracken report are dealt with in a new tribunal. Fine Gael believes the terms of reference are deficient in two major areas. We have tabled amendments to widen the scope of the terms of reference and to amend what we regard as the deficiencies.
We are proposing to include the question of whether the parliamentary allowance, known as the leader's allowance, paid to Mr. Charles Haughey as leader of the Opposition in the 1980s out of State funds was used either in whole or in part to discharge moneys or debts due by Mr. Haughey, by any company of which he was associated or by any connected person to Mr. Charles Haughey within the meaning of the Ethics in Public Office Act, 1995. In the event that the tribunal finds that such funds were used either in whole or in part in such manner, we propose that it should make whatever recommendations it considers necessary to ensure that in future such funds are not used for personal or non-political purposes. We believe there is some evidence to suggest that the leader's allowance paid to Mr. Haughey while in Opposition was not used solely to cover expenditure by the Fianna Fáil Party but was spent by Mr. Haughey at his sole discretion to cover political and non-political liabilities. If this is not so, the present Taoiseach can correct the record quickly by showing that the leader's allowance was properly dealt with within the Fianna Fáil Party. If the Fianna Fáil Party accounts do not put this issue beyond doubt, then it should be inquired into by the tribunal.
All parties in this House are agreed that the best way to proceed is to follow the money trail to establish if large donations, other than those paid by Mr. Ben Dunne, were used by Mr. Haughey to underpin his extravagant lifestyle. The leader's allowance is part of the money trail. Its accumulated value during those years in the 1980s when Mr. Haughey was leader of the Opposition amounted to approximately £1 million. Fine Gael believes this must be investigated at least in the initial stages during the private sessions of the new tribunal. If prima facie evidence is established that the money was not spent for the purposes for which it was intended, that is, for normal political expenses of the biggest political party in this country, then it should be included in the full public inquiry which is envisaged under the terms of reference of the tribunal.
Fine Gael believes that the aspect of the tribunal report which has shocked compliant taxpayers more than any other is the revelation that £38 million was lodged by Irish residents in offshore accounts, yet they had full access to the money through so-called memorandum accounts at Guinness Mahon. There is widespread belief that there is massive tax evasion. This belief by compliant taxpayers has been reinforced by the enormous amounts of money which accrued to the Exchequer in the course of the two tax amnesties introduced by Fianna Fáil Ministers for Finance. Despite the best efforts of the Revenue Commissioners in recent years, compliant taxpayers still believe there is one set of rules for PAYE taxpayers and that other rules or no rules at all apply to certain fat cat residents.
The revelations in respect of the Ansbacher accounts have added to this belief and have angered taxpayers. The public wants the Ansbacher accounts investigated. The terms of reference proposed by the Government will only allow investigation of any donation which may have been made to Mr. Haughey or to current or former office holders. The present terms of reference will not allow the new tribunal to investigate the non-political Ansbacher accounts. Mr. Justice McCracken points out that he has no doubt that some of these accounts were held for legitimate purposes, but he also clearly indicates that he believes others were not held for legitimate purposes.
Fine Gael is proposing an amendment to widen the terms of reference to enable the tribunal to investigate the Ansbacher accounts, as referred to and identified in chapter 6 of the report of the tribunal of inquiry, to identify in so far as possible the procedures used whereby Irish depositors of such accounts could have their moneys offshore with no record of their deposits in Ireland, to report whether such a system was used by the depositors to evade the payment of tax or was in contravention of exchange control legislation and to recommend all necessary steps to prevent such mechanisms being used to avoid the payment of tax. We believe the public interest requires the broadening of the terms of reference to empower the tribunal to carry out this investigation.
I cannot establish what the Government's position is on this matter. In an interview on the "News at One", which I understand was pre-recorded, the Minister for Social, Community and Family Affairs, Deputy Dermot Ahern, was of the view that Mr. Justice McCracken could continue his work under the terms of reference of the original tribunal, that he was empowered to identify the beneficiaries of all the Ansbacher accounts and that he could require the Revenue Commissioners to investigate possible cases of tax evasion. The Minister is clearly in error in his belief. The terms of reference of the McCracken tribunal confine Mr. Justice McCracken's inquiry to payments made by Mr. Ben Dunne, Dunnes Stores and associated companies. The McCracken tribunal has no power to investigate the accounts of other citizens unconnected with Mr. Ben Dunne, Dunnes Stores or the associated companies.
I am strongly of the view that a new tribunal acting in accordance with the terms of reference proposed by the Government may only investigate the Ansbacher accounts in so far as they relate to Mr. Haughey or current or former office holders. It may not investigate Ansbacher accounts opened for the purpose of tax evasion or for avoiding exchange control regulations.
The public has been horrified by the revelations contained in the McCracken report. The public wants to ensure a clean political system and that holders of public office are not corrupt. This is the public's first priority as it examines what we are doing in the House today and the terms of reference we put in place for the new tribunal. They will not forgive this House, however, if we miss the opportunity to enable the new tribunal to investigate the Ansbacher accounts and to expose tax evasion or breaches of exchange regulations, if that occurred. The Fine Gael amendment will enable the new tribunal to do this.
I strongly recommend that the Government accept this change in the terms of reference because the public, who will scrutinise us more critically now than ever before, will not be satisfied if we confine this solely to the issue of possible political payments through the Ansbacher accounts and possible favours conferred on foot of those payments. They will want the wider issue of the possibility of tax evasion and breaches of exchange control regulations to be examined also. Compliant taxpayers will not be satisfied with the terms of reference we are now debating. In the interests of having a proper tribunal which will satisfy public concern, I recommend that the Government accept the Fine Gael amendment and widen the scope of the terms of reference along the lines suggested.
We are also proposing other constructive amendments which will improve the clarity of the terms of reference. I will deal with those at the end of my contribution. The two amendments I have dealt with in some detail are different from the others as they significantly extend the scope of the next inquiry without damaging the focused nature of the terms of reference. As I have already said, they accord fully with the major public concerns which remain in respect of the terms of reference.
I will now comment briefly on the recommendations made in the report. The action taken by the previous Government in the Ethics in Public Office Act, 1995, and the Electoral (Amendment) Act, 1995, has provided Members of this House with a new and crystal clear mandate in respect of what is ethical or unethical in public office or in the conduct of general elections, particularly in respect of expenditure and donations connected with election campaigns. The tribunal in its recommendations acknowledges this and "considers in particular that it should be highly effective in monitoring ordinary political donations". Mr. Justice McCracken also said that the combined effect of the two Acts put in place by the Government, of which I was proud to be a member, amounts to a "commendable attempt to ensure that the unacceptable elements of the financial transactions of which Mr. Michael Lowry and Mr. Charles Haughey were part will not be repeated". It points out, however, that the legislation may not go far enough as many of the payments made to Deputy Lowry and Mr. Haughey were made offshore, in a manner veiled in secrecy and in an attempt to ensure they remained undiscovered.
What Mr. Justice McCracken is saying, in effect, is that those who would get involved in offshore accounts and mechanisms of such secrecy are unlikely to comply with the law in respect of the Ethics in Public Office Act, 1995, unless the sanctions are particularly onerous and he recommends a strengthening of the sanctions. Fine Gael welcomes the recommendations of the tribunal to make sanctions and penalties for breaches of the Ethics in Public Office Act, 1995, more onerous.
We also welcome the suggestion that consideration should be given to extending the jurisdiction of the Ombudsman to enable an independent third party to investigate possible breaches of the Ethics in Public Office Act, 1995. I have just heard the Minister for Finance expressing a different view. It is obviously a matter which would concern everybody in the House and it should be debated fully. We should find an agreed way of going further than the Ethics in Public Office Act, 1995, has gone in the light of the new information and circumstances which prevail.
Fine Gael also agrees that it should be mandatory on candidates for election to either House of the Oireachtas to produce to the Clerk of the Dáil or Seanad, as the case may be, a certificate from such person's tax inspector that his or her tax affairs are in order and this should be accompanied by a statutory declaration by the person concerned to that effect.
The section dealing with the recommendations in the McCracken report is a very short one. There are no earth-shattering proposals to clean up Irish politics contained in these recommendations. Mr. Justice McCracken believes, quite rightly in my opinion, that the two Acts introduced by the previous Government and enacted by the Oireachtas, to which I have referred, have provided an adequate framework for those of us now in the Dáil and Seanad. It is a tribute to the thoroughness of both Acts that Mr. Justice McCracken makes only a small number of recommendations and that none of them is an issue of magnitude.
When the McCracken report was first published many Members of the House and commentators in the media were of the view that a new tribunal should investigate a series of controversial Government decisions made while Mr. Charles Haughey was Taoiseach. These range from the sale of Carysfort College, the Masri affair, the passports for sale scheme and the beef tribunal, and we heard the list recited again in this House this evening. Every commentator and every Member of the Opposition seems to have his or her own list but there are a number of issues which appear on all lists. Wiser counsel has now prevailed and the tribunal in the first instance will operate along the lines of the advice given by the Leader of the Opposition, Deputy John Bruton, and follow the money trail. If the money trail leads back to the beneficiaries of those Government decisions, then a prima facie case will have been established that these decisions were not due merely to political incompetence but that political corruption occurred, and that is where the circle would be completed and the tribunal would get down to very serious business.
I want to examine two issues arising from the beef tribunal in which I have a strong interest to illustrate what I mean, namely, the issue of export credit insurance and the IDA package for the beef industry. In both cases the Goodman group of companies was the principal beneficiary.
I, as Minister for Industry and Commerce, abolished export credit insurance for beef exports to Iraq in May-June 1986. I did this after a thorough examination of the risk of continuing the cover after being advised to do so by my officials at the Department of Industry and Commerce and after consultation with Government colleagues. The incoming Government led by Mr. Charles Haughey, with Deputy Albert Reynolds as Minister for Industry and Commerce, restored the export credit insurance scheme in respect of beef exports to Iraq and the principal beneficiary of that action was the Goodman group. The facts in respect of these events have been frequently recited in this House. Charge and counter charge have been made and nothing has been proved beyond reasonable doubt. It is appropriate that the issue should be revisited in the context of what we now know about payments made to Mr. Haughey. I am not challenging anybody's moral worth or the personal integrity of Deputy Reynolds as I revisit these issue. I believe, however, that the public has never been fully satisfied in respect of these decisions and if the new tribunal, as it follows the money trail, arrives at the beef industry, then the decisions made by the Fianna Fáil Government in 1987 must be examined by any new tribunal in this light and context.
During the debate on the beef tribunal in 1994 when the Dáil was recalled at the end of the recess, the Leader of the Opposition, Deputy John Bruton, set out the charges arising from Mr. Justice Hamilton's report which Deputy Bruton and Fine Gael believed Deputy Reynolds should answer. Deputy Reynolds failed to answer them then or since and I would like to recall some of these for the benefit of the House. In this section of my speech I will refer extensively to the speech made by Deputy John Bruton in the course of the debate on the Tribunal of Inquiry into the Beef Processing Industry on 1 September 1994.
On 8 September 1987 the Cabinet agreed to raise the ceiling on export credit insurance to Iraq to £150 million. In so doing, it left the overall limit for export credit insurance generally unchanged at £300 million worldwide. Therefore, the Cabinet had decided that Irish exporters to markets other than Iraq were to be denied cover because so much of the cover was now to be concentrated on Iraq, a market in which the risk of non-payment was exceptionally high. This serious Cabinet decision was proposed by Deputy Reynolds on the basis of a memorandum circulated by him at the Cabinet meeting on 8 September 1987. This memorandum set out the special conditions on which this extra cover for Iraq was to be granted: (a) a maximum of 70 per cent cover would only be allowed for any contract; (b) a maximum credit period of one year as opposed to the normal six months for low risk countries; (c) a claims waiting period of 12 months as opposed to the normal six month period for low risk countries; (d) a minimum premium rate of 4 per cent of full contract value as opposed to the usual 0.04 per cent for good risk countries; and (e) cover would be provided only to exporters in respect of whom claims because of non-payment had not arisen in Iraq or who had been subsequently paid. The increased cover for Iraq was specifically agreed by the Government on these five conditions on 8 September, yet that very afternoon Deputy Reynolds, as Minister, started to break the conditions of the Cabinet decision. At 4 p.m. that day he met Mr. Oliver Murphy of Hibernia Meats and Mr. Paschal Phelan of Master Meats, a man who was not unknown to him. At that meeting he awarded £10 million cover to Hibernia Meats with a credit period of 18 months. By doing so, he had within hours broken two of the conditions on which the Cabinet had on that morning agreed the extra cover for Iraq. First, he had granted a credit period of 18 months whereas the Government had decided that the maximum period was one year. Second, he had awarded cover to Hibernia Meats, a company from which claims had arisen in Iraq and in respect of which payments were still outstanding.
Six days later, on 14 September, Deputy Reynolds, as Minister, broke even more of the conditions set by the Government on 8 September, this time for the benefit of the Goodman organisation. He agreed to give Goodman 80 per cent cover whereas the Government conditions specified 70 per cent. He cut the claims waiting period for Goodman to six months, not the year specified at Government. He cut the premium charged to Goodman on the Iraqi contract to 1 per cent as against the 4 per cent specified by the Government. This premium concession constituted on its own a gift of £2.74 million from the taxpayer to the Goodman organisation. This cut-rate premium of 1 per cent contrasted not only with the 4 per cent being charged to other exporters in the scheme but with a market rate premium of between 15 and 24 per cent which Mr. Goodman would have had to pay if he had insured his contract for Iraq on the commercial market. The Goodman organisation was getting a clear cash benefit as a direct consequence of Deputy Reynolds breaking the terms of the Cabinet decision. This special 4 per cent premium was advanced in the memorandum for Government as one of only three arguments in favour of giving Iraq a larger share of the total amount of export credit available, almost half of the total market. Yet that argument was ignored within hours of the decision being taken. No additional jobs would result from the gift of £2.74 million to the Goodman organisation because the Goodman group had the deal which was going to create the jobs in the bag for the previous two months.
The Minister's actions were a clear and deliberate breach of a Cabinet decision and this has never been fully explained.
The way in which Deputy Reynolds dealt with granting export credit to other companies was arbitrary and unfair. At the meeting on 8 September between Deputy Reynolds and Mr. Paschal Phelan, the owner of Master Meats, Mr. Oliver Murphy, the owner of Hibernia Meats, was also present. Mr. Murphy had been making representations, directly and indirectly, to Deputy Reynolds to no avail. He was trying to get a piece of the action in respect of export credit insurance cover which, until then, had been made exclusively available to the Goodman organisation. The difficulty was Hibernia Meats was owed money by Iraq and the Minister had made it clear up to then that any company owed money by that country would not receive cover.
However, at this remarkable meeting, to which no officials from the Minister's Department were invited to attend, out of the blue and without explanation Deputy Reynolds did an about face on the question of issuing export credit insurance cover to Hibernia Meats. Suddenly the Cabinet decision did not matter and Deputy Reynolds, at a meeting attended by himself and two others but not by officials from the Department of Industry and Commerce or a representative of the insurance company ICI, decided to issue export credit insurance to Hibernia Meats. At that meeting the Deputy agreed to provide £10 million export credit cover to Master Meats, the company of his friend Mr. Paschal Phelan who was also present. This was an amazing decision because there was no record of Master Meats having applied to the Minister, the Department of Industry and Commerce or ICI for export credit insurance cover in respect of Iraq. Master Meats had no contract to export beef to Iraq when it was offered the £10 million cover and subsequently made little attempt to negotiate a contract.
It must be remembered that, shortly after, a host of beef exporting companies which had negotiated contracts with Iraq were refused cover. Master Meats did not use the cover provided by Deputy Reynolds but transferred it to Hibernia Meats. We do not know whether this was done at no cost or for a commercial consideration. However, the worth of what was transferred to Hibernia Meats in terms of cover in the marketplace amounted to £1.7 million. Master Meats never applied for cover. However, due to the attendance of its principal officer at the meeting in question, it received such cover.
From this series of decisions, it can be seen that Deputy Reynolds flagrantly overrode the Government decision he sought in Cabinet that morning. He did so in the absence of civil servants and, therefore, no minutes of the meeting were taken and there is no record of the decisions made. Deputy Reynolds played favourites in issuing export credit insurance. He favoured the Goodman companies, Hibernia Meats and Master Meats to the exclusion of other beef companies. He also provided exclusive advance information about future Government plans for export credit to the Goodman Group, which gave it the inside track and amounts, in effect, to insider dealing. The Goodman Group knew the price it could charge in Iraq because it knew it would receive cover. This is plain from the written evidence presented to the beef tribunal.
Other aspects of Deputy Reynolds' decision in respect of export credit insurance have been debated in the Dáil on a number of occasions. However, in light of the findings of the McCracken tribunal and if in pursuit of the money trail a personal money link is established between the favoured meat companies and the then Taoiseach, Mr. Haughey, the issue of export credit insurance already investigated by the beef tribunal would have to be re-investigated by the new tribunal. I believe that the infamous package in respect of the Goodman Group of companies forced on the IDA by the then Government will also have to be re-investigated.
The beef tribunal report shows that while Deputy Reynolds was the Minister responsible for protecting the statutory independence of the Industrial Development Authority he allowed the then Taoiseach to pre-empt the role of the IDA by meeting the Goodman Group in connection with details of its negotiations with the IDA without the knowledge of the authority. Deputy Reynolds allowed a press conference to be called in respect of the Goodman beef project before the grant agreement was signed and before the authority had met to decide whether to accept his decision. This completely compromised the statutory independence of the IDA, an independence which, as Minister for Industry and Commerce under the 1986 Act, the Deputy had overall statutory responsibility to protect. Before that he allowed the Goodman package to go straight before Cabinet over a weekend. This allowed the Department of Finance one working day to examine the package worth £120 million.
Deputy Reynolds was involved in a Government decision which, in the words of the beef tribunal report "wrongly and in excess of its powers directed the IDA to remove the performance clause from the grant agreement being negotiated between the IDA and the Goodman Group." This was another extraordinary decision which could be put down to a mixture of high-handedness or incompetence.
In retrospect, as the new tribunal proceeds with its work, if the money trail ties in the favoured beef companies with significant payments to Mr. Charles Haughey to underpin his lifestyle, the door will again open on these incidents. There are an entire series of such incidents and I could refer to them at length. However, I referred to one example with which I am particularly familiar. I have made my point and I am aware that other Members of my party will do likewise in respect of other inexplicable decisions.
I propose to share time with Deputy Seamus Brennan.
Is that agreed? Agreed.
In discussing the serious issues being addressed we would all do well to recall how this House and the institutions of the State came into existence. The republican democracy we cherish today was won for the Irish people by deeply committed and dedicated men and women who, during years of struggle, put their lives on the line to create a new Irish state in which all citizens would stand equal under the law. The leaders included visionaries and scholars, but the broader ranks of those who bore the brunt of the struggle were very ordinary people — trade union members from urban factories, sons and daughters of small farmers, tradesmen and shop assistants.
I am sure that, while these men and women were decent and courageous, few of them would or could claim to be saints. I imagine, for instance, that very few of them would presume to personify the ideal held by Pearse when he said that "splendid and holy causes are served by splendid and holy men". They understood that among the broad mass of humanity, very few could ever meet that idealistic concept of Padraig Pearse. However, they had lived under an alien regime where class and privilege entrenched its own form of inequality and corruption. They rightly expected that those who would serve in the political life and administration of the new Irish State would adhere to high standards and that their prime motivation would be, at all times, the public good.
Looking back over the decades since the State was established, we can take pride in the fact that the overwhelming majority of those of all political persuasions who served the State have done so with integrity and honour. This is as it should be. It is what our people have a right to expect. That is why the matters which came to light during the McCracken tribunal have caused so much public dismay. They have also inevitably led to much questioning of our political and administrative system and, as is evident from recent opinion polls, much cynicism about the motives and bone fides of those of us who have chosen to make politics our life's work. That cynicism is unjustified and unfair not only to the overwhelming majority of the Members of the Houses of the Oireachtas but also to the many hundreds of men and women who give dedicated and often scantily acknowledged service as members of local authorities.
While, as I stated, that cynicism is generally unjustified, it is, in the current post-McCracken climate, understandable. For that reason, we have a duty to ourselves and to all who serve in political life at national and local level to address its root causes and explore these particular instances of inappropriate behaviour. By so doing, we give a clear signal to the community at large and to all those aspiring to political office that we expect and require correct and proper standards from all who are privileged to discharge the affairs of the nation. In Government and in this House we are about the people's business, not our personal business.
The proposed tribunal is mandated and empowered to go as far as is possible and practical in its investigation of the many questions which arise following the outcome of the McCracken tribunal. The terms of reference of the new tribunal are broad enough to focus in a realistic way on finding answers to them and, yet, specific enough to ensure it does not wander and remain in session following various leads until we are dead and gone.
The McCracken tribunal deserves the many commendations it has received. It has set a head-line and provides an example of how such tribunals should go about their business. I am confident the proposed tribunal will be equally effective. Its terms of reference reflect a reasonable consensus of the views of all parties and Deputies. I am confident that Members of the Oireachtas and the citizens they serve will be satisfied with the work of the new tribunal and its outcome.
In dealing with these matters I have tried to avoid political acrimony. It is a pity the adversarial traditions of our parliamentary system and the competitive prompting of human nature should cause Deputies to indulge in partisan political point scoring when issues such as these are discussed in the House. I accept to a certain extent this is inevitable but that should not be our general approach — too much is at stake for that. Opinion polls show that the revelations prior to and during the McCracken tribunal have diminished us all in the perception of the public. Our approach, whatever our political allegiance, should be to make sure public trust in our institutions and politicians is not misplaced. It follows that systems and mechanisms must be provided which ensure that if public office holders abuse their office there are means to discover and expose such abuse. The tribunal proposed in the motion is one such mechanism.
Since the State was established, the need for tribunals of this nature has only arisen on relatively rare occasions. As the proverb has it, big oaks from little acorns grow. People rarely set out to misbehave from the start. As is the case with all temptations, people fall little by little as one misdemeanour leads to another. It would be to our advantage if we had the means of nipping things in the bud in the House. That is why I am attracted to the idea put forward by the Taoiseach of a committee or similar body which would be available on a permanent basis to examine allegations of irregularities as they arise. The existence of such a body would be a salutary deterrent to anyone tempted to stray from the straight and narrow in discharging his duty to the electorate. More importantly, from the standpoint of the great majority of well motivated politicians, it would provide the means to deal readily with and dispose of malicious rumour and unsubstantiated accusation. People in public life make easy targets for purveyors of rumour and insinuation. Decent men and women who work hard and honestly in the service of their constituents should have a means of defending themselves from baseless charges or from the deadly inference conveyed by nod and wink.
Through this tribunal we rightly seek to thoroughly investigate inappropriate behaviour by people who hold high office and try to establish whether important policy decisions could have been influenced by contributions or donations along the presumed money trails. They must be thoroughly explored whatever the consequences. When that is done and a regular investigatory body is eventually set up, this phase should be put firmly behind us.
If public life comes to mean living constantly at the mercy of rumour mongers, what sane young men and women will want to embark on a political career? Watching events in the United States over several years, one is struck by the time and energy devoted to the seemingly endless pursuit of scandals, real or imagined. Accusations of scandal have become a regular weapon in the American political armoury and we should not go down that road. We must be careful not to replace democracy with, to coin a word, "enquirocracy".
This evening in our bid to host the Special Olympics in 2003 I had the opportunity to address most of the overseas ambassadors in Dublin. A few of them made the point that we are fortunate to have a press and media which are by and large models of responsibility in comparison with those in other countries. I hope this enviable reputation enjoyed by the great majority of the Irish media will long continue.
I am afraid some members of the Opposition, particularly in the Fine Gael Party, see inquiries and the hint of scandal as a means of gaining the glittering prize of office repeatedly denied them by the electorate. Some people in Fine Gael have not yet been able to come to terms with the recent and emphatic verdict of the electorate. They recall that three years ago following an incomprehensible administrative foul-up which had hardly anything to do with politicians a good Government was put out of office. As a result Fine Gael to its amazement found itself in Government. Some of its members seem to harbour the illusion that they can make history repeat itself. The situation and parliamentary mathematics are quite different today from what they were three years ago but hope springs eternal. Having cast aside their one time great white hope, Deputy Lowry, into outer darkness they have re-adjusted their plastic halos which melted in the heat of Government, donned their familiar but badly dented armour of righteousness and with the help of certain sections of the media and a long time disagreement between two very elderly gentlemen have targeted the Minister for Foreign Affairs.
Fine Gael has a predictable time worn and never varying strategy in attacks on Fianna Fail. It is based on a mythology it has cultivated since Fianna Fáil first entered the Dáil. In it Fianna Fáil politicians and supporters are all a bit dodgy. Fine Gael strides to the attack with all the disdain and pious suspicions of old money confronting pushy tradesmen who do not know their place and need to be taken down a peg. Of course, we must never ask where the old money came from in the first place.
However, down the years, the public has not been taken in by these boring attempts to demonise Fianna Fáil. People know that Fianna Fail is the party which has always led the national advance and which has transferred this country from an economic backwater into a thriving modern State.
To the sound of trumpets.
Almost every major initiative in economic and industrial development over the years has been promoted by Fianna Fail.
The same is true in regard to the provision and growth of our health, education and welfare services.
Has the Minister a new script-writer? He should come into the 20th century.
The Deputy should not use up my time, I am anxious to contribute.
Acting Chairman
I ask Deputy Bruton to restrain himself.
Fianna Fáil is proud of that record. Our detractors can show little to match or compare with that record and the people know it. Our detractors play a classical game of political chess. Is it any wonder we politicians find ourselves in the basement of political opinion? Our conduct in this House has recently been of a nature of personal political attacks rather than policy political attacks as it should be and on which the good name of this institution as a proud Republic was built.
I listened carefully to the Minister for Foreign Affairs, Deputy Burke, as he made his statement and dealt with the questions put to him today. It was a comprehensive and formidably delivered rebuttal of the accusations made against him. The Taoiseach had already carried out his own inquiries and is satisfied that the Minister has accounted fully for the transactions in question. Following his convincing Dáil statement it is not Ray Burke but his accusers who have questions to answer. I have known the Minister as a colleague for a number of years. There is nothing in the way he carries himself that suggests anything that smacks of the devious or conniving. If anything Ray Burke is blunt to a fault.
Acting Chairman
I ask the Minister to refer to Members by their title.
In dealing with this controversy the Minister has been forthright and direct, his accusers have not. If the accusations made against him had any substance we would expect him to be a man of conspicuous wealth. In the course of my many conversations with him over the years, I have always found he had the same mundane worries about the cost of things, such as school fees, car repairs and household expenses, as the rest of us. I saw no evidence of the Midas touch in the Minister for Foreign Affairs.
The Minister came to this House as the son of one of the most highly regarded and decent Deputies who ever served in the Oireachtas — the late Deputy Paddy Burke. He inherited a great tradition of service to the country and to his constituents from his late father. The resounding votes of confidence he has received from the voters of north County Dublin in election after election, is telling evidence of how well he has followed in his father's footsteps.
The new tribunal can do a valuable service for Irish democracy in demonstrating our determination to ensure high standards. I was never more proud of Fianna Fáil than on the occasion of our recent Ard Fheis when the Taoiseach, the leader of my party, set out in unambiguous terms his determination that Fianna Fáil would always respect the trust and confidence placed in it by the people and that no wrongdoing would be condoned, no matter how eminent the individual involved might be. He will continue to operate in that vein and this House and all its Members will benefit as a result.
I do not feel diminished by what has been happening nor should the vast majority of Members from all parties. The Members, out of 166 TDs, who might be guilty of some mis-demeanour would be in the minority, probably much smaller than in any other profession or occupation here. The people have been well served by the vast majority of Members over the years. It is important that all of us work to restore the confidence of the people in the institutions of the State.
This year between my father and myself, we have given 70 years of unbroken service to this country. When I became a Member in 1965 I had the honour to serve with Members who had put their lives on the line to create this State. My late father, Robert, was one of those people. He served the people for 38 years; I have served for 32 years and I am proud of that. I am proud too that no taint of scandal has ever touched my name or that of my late father. I have the same confidence in most of the Members. Most of us believe in high standards in public life.
It is time to give consideration to the setting up of what is popularly known as a whistle blower's charter for any member of the Civil Service who considers a Cabinet Minister is behaving in a way which is detrimental to the office and to the country, that such officials will have a committee to which he or she can report. We should consider also setting up a sub-committee of the Committee on Procedure and Privileges to examine complaints. Rather than having such complaints dealt with outside they should be heard by an all-party committee. If questions deserve further attention they should be passed on to an outside body for adjudication. That would be preferable to a series of tribunals year after year. I stress that I support the tribunal.
There are many bodies that may need closer examination. I do not believe, for example, that every semi-State company is as pure as the driven snow. There may have been abuses by a small number of people. I do not wish to turn this into a police State but a watchdog system would enable people to report wrongdoing without fear of losing their jobs.
Some years ago a young accountant working in a company came to see me. He was troubled because the company had asked him to do something he considered to be dishonest. He was told if he did not comply he would be fired and would not get a job anywhere else. I sent him for legal advice and it was suggested to him that he resign from the company. The number of companies that tempt people to perform dishonest deeds for reward is probably greater than we believe.
Our first priority is to restore public confidence in the institutions of the State. As the Taoiseach said we are grateful to those in the media who have highlighted the wrongdoings of recent years. Certain members of the press have a responsibility for the role they played in supporting wrongdoing over the years. I will not mention any particular journalist by name but the person who comes to mind has long since gone to his eternal reward. That person was doing things that, had a Member of this House done them, would have resulted in him being called a rascal. No profession is free of its rascals. The journalists have their rascals, the semi-State companies have their rascals and I am quite sure there are civil servants who are also rascals. However, we have been served well by the Civil Service, and it is wrong that a civil servant may find it difficult to report wrongdoing. That is why it is important to have a whistle blower's charter under which people can make their fears known in confidence.
Governments will have to examine the pay of Dáil Deputies. I am a full-time TD as are a number of other Deputies. The pay of a TD is less than that of middle management in a supermarket. A Quinnsworth manager gets more than a TD. Garda Superintendents are paid more than a TD. It is ridiculous that Deputies are confined to such a low pay structure, that many TDs, where they have large families, cannot afford even to send their children to university. If we want people of quality to go into politics full-time we have to pay them. Why should they work at a career in politics if politicians are so badly paid, when there are other occupations they could take up which would benefit them much more? I have been a TD for 32 years but anyone who is elected gets as much pay on the first day as I get having served 32 years — there is no such thing as an incremental increase for a Deputy, no such thing as service pay. If I were in the public service I would probably have been kicked out years ago for inefficiency if I were still of the same rank at which I started. If I worked in a lawyer's office or in an accountant's office I would not expect to be on the same salary after 32 years unless I were doing something very menial.
We appointed people to look into the conditions and pay of Dáil Deputies, but we appointed the wrong people. Within the past few years a lawyer recommended £15 a week to cover our constituency expenses. That man had no difficulty in taking £1 million in fees for himself. I was insulted when I saw that report. We have not had the courage to give a decent salary to Deputies. Interestingly, the backbenchers in the House of Commons gave themselves a substantial increase, and there was nothing the Government of the day could do about it. Perhaps it would be a good idea for us to set up an all-party backbenchers' committee with some power. There will always be people who will oppose increases, but somebody who did that lost his seat at the next election. Anyone who cares to look through the record will find that is true. It is sometimes said that for people to stay honest one has to pay them, but that is not necessarily so. People are either honest or dishonest. My point is that honest people should not be penalised, and most people who go into politics are honest and should not be penalised because they have an idealistic bent.
(Dublin West): There is no doubt the McCracken tribunal confirmed a series of scandalous actions by Mr. Haughey and Deputy Lowry. I am extremely concerned that the steps being proposed by the Government in the terms of reference before us do not in any sense address the real concerns ordinary people want addressed in the dealings between politics and big business. It is correct to further inquire into the affairs of Mr. Haughey and Deputy Lowry, but my concern is that confining further investigation to those two men is to use them as lightning rods to conduct the anger of ordinary people and to divert attention from wider questions that should be addressed in regard to the relationship between big business, wealthy individuals, leading politicians and political parties.
It was entirely accidental that Mr. Haughey and Deputy Lowry came to light in terms of their relationship with one business man. We will have had two tribunals because of that accident. We have dozens of leading politicians, hundreds over the past ten or 15 years, and hundreds of business people and powerful firms. Should it be left to a further accident to discover if other scandals remain hidden in regard to the relationship between other businesses and political parties or other politicians?
For many years it was known that a golden circle involving some of the most powerful people in the State was in existence. That golden circle was unmasked by the revelations at the McCracken tribunal, but how much of the circumference of the golden circle has been revealed and how much still lies hidden we can only guess at. Ordinary people want the truth. Unfortunately, an opportunity which now presents itself to get close to the full truth is not being taken by the Government in its proposals.
The Government speaks of following the money trail. There have been a number of extremely significant trails, not just one, in the past ten years in politics and business. The Ansbacher accounts constitute one important money trail that should be followed, the £38 million deposited by Irish residents in offshore accounts. According to the report of the McCracken tribunal, Mr. Haughey used this to evade tax. In the report Mr. Justice McCracken spoke about this being an ingenious system that other unidentified individuals or businesses use. He said perhaps some people used it for business but that no doubt there were others who deposited money in this way for other motives. That alone should have set lights flashing for the Government when it came to drawing up the terms of reference of a new tribunal. What other motives, and who? It seems clear that should be examined. No wonder the accounts were in codes rather than in names, in view of the other motives. The full glare of a public inquiry should be focused on the Ansbacher accounts and on those who deposited money in them. The Government's proposal narrows the focus essentially to Mr. Haughey and "to any other person who holds or has held public office during the period of his/her tenure". Why not hold an inquiry into all depositors and all aspects of Ansbacher? That is why I tabled an amendment which proposes that we should establish the beneficial owners of the moneys in the accounts and the motives for lodging the money there. I hope all parties support my amendment as the majority of people want what is proposed under it.
There is a curious restriction in the Government's wording. Why should the inquiry be confined to the period of tenure of an office holder? An office holder could have had significant accounts before or after his or her period of tenure. Those words should be deleted to enable a full investigation into funds held at any time by office holders before, during or after their tenure of office.
The tax amnesties of 1987 and 1993 are another significant money trail in Irish politics and business in the past ten years. The McCracken tribunal dealt with scandalous events at the interface of big business, politics, leading politicians and political parties in the State. It has uncovered serious scandals, but no event has revealed the scandalous undertakings at the interface of business and politics more than the two tax amnesties granted by the Dáil in 1987 and 1993 when up to £1 billion was wiped out in due taxation by super rich individuals and powerful companies. It is a scandal that because of the secrecy surrounding the amnesties we do not even know the amount of money that was written off. Those amnesties could be viewed as a direct robbery of taxpayers which cheated people of resources that could have transformed the lives of people such as the homeless. The £1 billion involved could have been used to reduce hospital waiting lists and to provide much needed facilities in working class communities. It could have been used on a multitude of causes that could have assisted people in need in our society. However, it enriched an elite by up to £1 billion. In the more blatant cases, top companies and super rich individuals benefited by many millions of pounds because they were able to write off large sums of money. It was similar to writing a cheque into their accounts.
It is incredible that political parties elected by the people of the State could foist such a cheating double cross on the majority of hard pressed PAYE workers who carry the brunt of the taxation system. The injustices are still obvious. I wonder if the elected Members for Dublin are aware that every week, local authorities drag decent PAYE taxpayers before the court because they refuse to pay water charges, which they consider intolerable and unjust double taxation. They are being prosecuted for the sake of £210 arrears in the South Dublin County Council area or £255 in the Fingal County Council area, and are threatened with mention in Stubbs' Gazette and other sanctions. While the backbone of the taxation system is treated in this way, not one millionaire taxation cheat has darkened the door of a court in this State to answer tax evasion.
The cheated PAYE taxpayers want to know whether support for the tax amnesties of 1987 and 1993 was swayed by contributions from the beneficiaries of those amnesties not just to politicians but to political parties. That is why I have drawn attention to this by proposing an amendment which would require an examination of whether any substantial payments were made, directly or indirectly, to any political party, public representative or Dáil candidate by any person who benefited from those amnesties. That is a simple matter to investigate since the identities of those people are available on the files of the Revenue Commissioners. If the inquiry about to be embarked upon is to mean anything to ordinary taxpayers that question must be answered.
Some speakers have said that many of the more blatant Government actions when Mr. Haughey was Taoiseach must be examined, and I agree. In particular I want an examination of the sale in 1992 of Glending Wood, near Blessington, County Wicklow. I have put down an amendment in this regard which I hope will be supported by all the Opposition parties and those Fianna Fáil and Independent Deputies who have publicly expressed concern about this matter. This is a scandal of major proportions which must be investigated and exposed.
The State secretly sold 147 acres of land owned by the Irish people to Roadstone Dublin for £1.25 million. Roadstone purchased the land in order to quarry the sand and gravel which exists in large quantities on the site. It is conservatively estimated that some 24 million tonnes could be quarried there. If one conservatively prices the material at £3 per tonne, the total receipts would be £72 million. Industry sources say the cost of extraction might amount to £1 per tonne, and if one subtracts £24 million from £72 million, this one company is left with a potential profit of £48 million from lands which were secretly sold without going to public tender. The sale price of the land amounts to about one penny per tonne.
That is not related to the priceless value of those lands for the people of Blessington, Wicklow and Dublin who would use them for recreational purposes. It is an area of beauty in which people can engage in recreation and relaxation.
Another price of this scandal would be a dramatic change in the surrounds of Blessington by the removal of sheltered areas close to the quarry. That could have an adverse effect on the microclimate of the area.
In the course of this episode an archaeological site, SMR 11, was delisted before the sale and has subsequently been restored. There should be a full investigation of the circumstances surrounding the delisting of that site to facilitate the sale to Roadstone. Who ordered it? By what mechanisms was it carried through?
During the negotiation of this sale Mr. Traynor was chairman of the parent company, Cement Roadstone Holdings, and manager of the Ansbacher accounts and Mr. Haughey was Taoiseach. In view of what has emerged in the McCracken report and the massive amounts of money and lands involved which belong to the people, all aspects of this matter must be included in the terms of reference of this tribunal.
I appeal to the Minister for the Environment not to await the outcome of the tribunal but to intervene now to set aside the scandalous rezoning of these lands last year by Wicklow County Council to facilitate quarrying by Roadstone. He has the power to set aside the rezoning and begin the process of returning those lands to the ownership of the people of this State.
I have also proposed an amendment that all political parties should make full disclosure for a period of, say, ten years of substantial contributions they received from wealthy individuals or business concerns. It is crucial that this happens. All the talk of accountability, transparency, restoring confidence etc. is just so much empty rhetoric if the parties which dominate political life in this State are not prepared to be upfront, put their hands in the air and say how much they received from individuals, businesses or powerful economic concerns.
There are many questions to be asked. The two leading parties in the State, Fianna Fáil and Fine Gael, have raised massive sums for their campaigns and to erase their debts over the past ten years alone. They should be upfront now and state from where the funds came and how much they constituted. I have tabled an amendment that that should be within the terms of reference of the tribunal.
The difference between personal donations and those to political parties is only one of degree. Leading members of the main political parties are always at pains — in fact, they protest too much — to differentiate between personal donations and those to political parties. I hope they know that nobody believes big business contributes substantial amounts of money to political parties because they are philanthropists and want to be nice. A number of years ago the banks contributed hundreds of thousands of pounds to five political parties. Dunnes Stores, one of the stingiest employers one could find, exercises huge largesse in the political arena. People believe they do so on a quid pro quo basis.
Corruption is not necessarily a secret deal behind closed doors where terms are clearly laid out in return for a political donation. In my view donations are given to create an atmosphere where the leading political parties will think favourably of the businesses which make them. For example, when it comes to framing a budget, the banks hope a levy will not be imposed on them, or if one is imposed that it will be several percentage points less than it might be otherwise. In that way they save millions if not tens of millions of pounds. That is the use of large-scale political donations by business to political parties. Businesses hope that when parties are in Government they will look with sympathy on their special pleadings.
This position arises from the nature of the economic structures which dominate society. I equate it to an economic dictatorship where big business interests, powerful millionaires and banks and financial institutions wield enormous power — almost to the extent of life or death — over ordinary people, particularly in terms of their jobs, income, living standards and other aspects of their lives. The philosophy of the conservative political parties in this State is at one with that system. They regularly received substantial funds from the main players.
This creates an atmosphere which inevitably results in the scandals of which we are aware and others which are still hidden. The details which emerged in Mr. Justice McCracken's report in terms of sheer cronyism and corruption rival the Philippines of the late President Marcos. There is utter cynicism among ordinary working, unemployed, poor and young people about the political system and the major political parties which dominate the State as a result of the link between business and politics and the scandals that have emerged.
Following the catastrophic death of Diana, Princess of Wales, there was an extraordinary outpouring of emotion and mourning by millions of people in Britain, Ireland and internationally. Did any Irish politician remove himself or herself from the atmosphere that was undoubtedly excessively hyped up by the media, which is among the most cynical players in society, to ponder the real meaning of the reaction which was so strikingly demonstrated on television and in the press?
Politicians should ask how a celebrity from an aristocratic background, whose status resulted from being part of the most conservative mon-archy that western Europe has ever seen, became a symbol of concern and compassion for the poor, the sick, the homeless, lone parents, the Third World and victims of landmines which are the result of cynical manoeuvrings by governments and the military-industrial complex.
The fact that this is where people reposed some hope is a crushing indictment of the leading politicians and parties in these islands. It means that they have left the vacuum which allowed this phenomenon to occur. They have failed utterly to address the concerns or problems of those people who have mourned for the past week. A majority of ordinary people have no faith that politicians have solutions for their problems and projected their hopes on to a celebrity who died tragically. That should be pondered carefully by politicians in this State.
The events leading up to the McCracken tribunal have added hugely to the cynicism of ordinary people regarding the established political parties. A new tribunal will not remove that cynicism but will add to it unless the terms of reference are widened to include some of the major concerns expressed by ordinary people who pay their taxes and live up to their responsibilities. Those concerns should be addressed, which is why I have tabled the amendments which I ask other Members to address in their contributions.
If it is agreed, I wish to share my time with the Minister of State at the Department of Education, Deputy O'Dea.
Is that agreed? Agreed.
I echo the comments of Deputies on both sides of the House congratulating Mr. Justice McCracken and his tribunal team on their excellent report.
I recall how when this tribunal was first established the sceptics suggested it would run into the sand and become lost in a maze of financial transactions. It is to the credit of Mr. Justice McCracken that these predictions proved ill-founded. Instead the tribunal team showed remarkable investigative zeal and in doing so rendered an important public service. The tribunal has produced a report that is comprehensive and succinct, and one with grave implications for the body politic.
All of us who believe in the vocation of public service will have been deeply dismayed by the contents of the report which raise grave issues of public trust that must be immediately addressed. The tribunal's investigative work was excellent but, with all due respect to Mr. Justice McCracken, much of the two pages of recommendations, which referred mainly to proposals made by Fianna Fáil's senior counsel to the tribunal, did not go far enough. Mr. Justice McCracken and his team could have made more detailed proposals.
The Government is united in its determination to ensure the truth will emerge and will ensure the full and speedy implementation of the report's recommendations. This is why we are establishing a new tribunal, why we have produced terms of reference that will ensure the fullest possible investigation, why we are to establish a permanent policing structure in the form of a public ethics committee and why we are holding a referendum on Cabinet confidentiality. We may uncover what happened in the past, although we cannot change it, but we can definitely find a cure for the future.
It is a great honour to be elected to this House and to hold a position of trust. Honesty and integrity must be our core principles. The majority of politicians, past and present, subscribe to these principles. This means that any behaviour not in accordance with these principles must be exposed to public view. Our democracy is a precious thing. It should not be taken for granted. Members of this House are the custodians of our democracy. We must ensure our democratic system is untainted and that it is seen to be above suspicion at all times.
However, our democracy depends on public faith in the political system and, unfortunately, at present cynicism is rife about political life here. The vocation of politics is not held in high esteem. This cynicism is corrosive and eats into the foundations of our democracy. There is a responsibility on all of us in this House to restore public faith in the political system and remove this atmosphere of cynicism. The public has a right to demand the highest standards from politicians and political parties. The public also has the right to a transparency which ensures that politicians are not being compromised in any way in regulating business or legislating for the public interest. Rightly or wrongly, for some time there has been a public perception of an elite golden circle operating in Irish society with direct access to the levers of power and the time has come to tackle this perception head on.
Perhaps in the short-term the findings of the tribunal may serve to increase this cynicism. However, in the longer term, the McCracken tribunal, and its successor, will vindicate the strength of our democracy and serve to reaffirm public faith in the democratic system. It shows that the Government, and all parties in the Oireachtas, are ready to address serious allegations about office holders, and former office holders, without fear or favour. The public expect nothing less and the Government will deliver nothing less.
Such are the findings of the McCracken tribunal that it is vital that a new tribunal be established without delay to bring this process to a full and transparent conclusion. However, the success of the new tribunal will depend on its terms of reference. If the terms of reference are not sufficiently focused the tribunal runs the risk of getting bogged down in a morass of red tape and losing sight of our original aim, that is, the disclosure of the truth.
The terms of reference for the new tribunal have been carefully considered. In framing these terms of reference the Government was particularly keen to ensure that any remaining anxieties about the conduct of ministerial office holders in recent times are fully resolved. The terms of reference will allow for a full investigation into the "money trail" revealed by the McCracken tribunal, including the Ansbacher deposits unearthed in the course of that inquiry. The new tribunal will have the power to investigate any further donations to Mr. Haughey or Deputy Lowry, and will ascertain whether such donors benefited from any Government decisions.
I wish to refer briefly to a number of points in regard to the terms of reference with which some Members may have difficulties. The first is the privacy provision; the second is the inclusion of private individuals in the inquiry into the Ansbacher accounts and the third is the failure to include a list of controversial decisions. These are, the privacy provision in the terms of reference, the non inclusion of private individuals in the inquiry into the Ansbacher accounts and the failure to include a list of controversial decisions. There are reasons the tribunal is being mandated to conduct its preliminary investigations in private. In effect this is putting in explicit terms, the procedure adopted by Judge McCracken when he conducted investigations in private. Private investigations will protect the integrity of the inquiry by not alerting those who are the subject of investigation until such time as the tribunal deems appropriate. Investigations in private allow the tribunal to sift the evidence, discard allegations where there is no evidence to substantiate them and only proceed in public with issues supported by evidence. This has the effect of protecting the good name of all persons who may be involved either directly or indirectly in such investigations. In effect, this concerns prima facie evidence. The more time spent in private investigation the less time will be spent in public hearings, thereby containing the cost of the tribunal.
It is incorrect to say there will not be an inquiry into the Ansbacher accounts under the terms of reference currently before the House. Such an inquiry will be made in relation to Mr. Haughey to determine whether there were sources other than Mr. Dunne who lodged money in these accounts for the benefit of Mr. Haughey. The accounts will also be investigated to determine whether any payments were made from money held in the Ansbacher accounts to any person who held public office during the period of their tenure.
The inquiry will not determine whether private citizens held money in these accounts, whether for the purpose of tax evasion or not. Such an inquiry falls directly within the remit of the Revenue Commissioners and should be left to them. If necessary they should seek further powers to enable them carry out their work. However, I do not believe they need further powers.
The new inquiry must focus on whether there is evidence of political corruption. The Government's view is that the McCracken tribunal should proceed to investigate what was referred to in the report as the missing links in the Ansbacher accounts. In this context there was reference by the Government to the McCracken tribunal having already lodged a notice of appeal against the decision made against it in the Cayman Island courts.
I accept the Opposition has a duty to make political capital out of an issue like this. However, listing six or seven controversial decisions would result in missing out on other issues. Even an expanded list could be attacked by the Opposition for being incomplete. It is not intended to refer to a list of transactions where there may have been corruption but where there is no evidence of such. Any list risks inclusion of transactions which are innocent, to the detriment of the good name of innocent parties while on the other hand excluding transactions which may have been tainted.
The terms of reference are drafted in such a way that the tribunal can investigate the circumstances of any payments found to have been made to Mr. Charles Haughey or Deputy Lowry and examine whether any transactions were influenced by those payments. The transactions which may be investigated are not, therefore, confined to an arbitrary list. The tribunal will be required to ascertain whether substantial payments were made, who the donors were, how much was involved, when the payments were made, whether any controversial decisions were made at that time involving that donor and whether, as a consequence, the tribunal believes that either Mr. Haughey or Deputy Lowry carried out any act or made any decision to confer any benefit on that specific donor in respect of that particular transaction.
The responsibility to address the matters raised in the McCracken report is shared by all parties and Members of this House. The Government has gone out of its way to achieve cross-party support on this crucial matter. The Taoiseach has engaged in an unprecedented degree of consultation with Opposition party leaders to achieve the broadest measure of agreement on how we should proceed. The public expects to see us work together in this regard and I am somewhat disappointed that the Opposition parties have seen fit to amend the Government recommendation. The fact that they have, in effect, endeavoured to play politics does them no service. The Opposition parties have acknowledged on the air-waves that the Taoiseach went far beyond their expectations in regard to the consultations on the terms of reference and the way in which he addressed them, yet they felt it necessary to table other amendments. They will not receive any kudos from the public as a result because the public believes that Dáil Members should unite on this issue and should endeavour to get the best possible terms of reference in order that we can allow a tribunal to get on with its work.
The manner in which we conduct ourselves during this debate is also important. I would caution against any attempt to make political capital out of this situation or to manipulate this debate for party political advantage. No one party has an exclusive claim to the moral high ground as parties on the other side of the House have found to their detriment. There is sufficient public distaste for political squabbling as it stands; to engage in it at this time would only serve to foster the public cynicism I spoke of earlier.
It is worth recalling that on 21 July, the final day of the tribunal hearings, senior counsel for Fianna Fáil outlined a wide series of proposals, including the establishment of a Public Ethics Commission. This followed directly on proposals made by the Taoiseach and then Leader of the Opposition, Deputy Ahern, when he spoke at a debate in Trinity College on the issue of public ethics in February. He effectively laid out his stall in regard to the way in which he viewed the issue of public ethics and the effort by politicians to turn around the cynicism which unfortunately exists among the public in relation to the profession of politics. The Taoiseach's views were amplified in the course of the final submission by our senior counsel to the tribunal. The proposals which were outlined were correctly described as radical by one senior political commentator. It is this radical approach to standards in public life which is the hallmark of Deputy Bertie Ahern's leadership of Fianna Fáil and his stewardship of this country.
In Opposition and in Government, the Taoiseach has been determined to establish the highest standards of probity not just in political life, but in public life generally. From the initial revelations regarding the Dunnes payments to date, the Taoiseach has acted decisively, setting the agenda in addressing these serious matters of public trust. In a speech to the Fianna Fáil Árd Fheis earlier this year, he set out, in blunt terms, what was acceptable and unacceptable behaviour in public life. Nothing less will be tolerated by this Government.
The Taoiseach's approach represents the politics of a new generation for a new generation. He has made it clear that no unethical behaviour will be tolerated in public life and that any deviation from these high standards is unacceptable and will be addressed upfront. In other countries, and in several American states, an independent investigative agency is an integral part of the policing of standards in public life. It is par for the course. The Government believes that such a body should be established in Ireland and become a permanent part of our political system. In February of this year, Fianna Fáil in Opposition proposed the establishment of such a public ethics commission with a remit extending beyond that set out by the Ethics in Public Office Act. We did that on the basis of the models already in existence in America for some years. In Government with our partners, the Progressive Democrats, we will make that commitment a reality. The commission would be independently appointed and would be headed by a senior public official who would have the status of a High Court judge or the Ombudsman. This body will be able to investigate, with the assistance of all the resources of the State, any accusations of impropriety that appear to have substance.
I was somewhat disappointed with the recommendations of Mr. Justice McCracken, particularly that which suggested that rather than setting up a public ethics commission we should give the Ombudsman the job of investigating these matters. We examined that recommendation but felt it did not go far enough and that a public ethics commission, preferably with a judge as its chairman, with powers similar to a High Court judge, should sit on a permanent basis to investigate complaints such as those we heard about earlier today in the House. A Member of this House had to come into this House to answer in effect unfounded allegations made by somebody who was not prepared to put his name to a statement. If a public ethics commission was established, the person who made those allegations could have appeared before it to make the complaint so that the person against whom it was being made could answer it. Such a body is absolutely essential if we are to move forward. The Minister for Finance is progressing that legislation and will bring it before the House quite quickly.
I am still at a loss to understand the criticism of this proposal by some of the more verbose Deputies. I will put this carping down to the party political jockeying I referred to earlier. The model of a public ethics commission has already worked well in America. Such a body would provide a permanent structure to ensure the highest standards in public life. It would allow for a wide range of information to be made available to the public and would provide a legal basis to oversee and ensure the integrity of public officials and elected representatives. It would also provide a mechanism by which to monitor the interests of those who seek to influence those in public life. Once again we will consult with the Opposition to ensure that any mechanisms established in this regard will be effective and efficient.
The Government has also pledged to relax the rules on Cabinet confidentiality in a referendum to be held on 30 October. This is another crucial step in the process of ensuring proper transparency. It should facilitate the new tribunal in its work by relaxing the absolute obligation imposed on Ministers not to disclose the content of Government discussions.
Taken collectively the new tribunal, the referendum on Cabinet confidentiality and the forthcoming public ethics commission represent a substantial response to the issues raised by the tribunal. These measures will allow for a more open conduct of political life and establish ongoing mechanisms for dealing with breaches of public trust.
The contents of the tribunal report make for painful reading. However, the report offers us an invaluable opportunity to lift the cloud of innuendo and suspicion that currently hangs over politics in this country. Through the establishment of a new tribunal we can get to the root of questions raised by the McCracken report and dispel the cloud of suspicion that hangs over political life. This would allow for a cleansing process, one that would restore public faith in our political system. The Government is determined to bring this cleansing process to a conclusion and in doing so usher in a new era in Irish politics, one exemplified by openness, trust and accountability and one in which the public will have full confidence.
This country currently faces tremendous challenges — the fulfilment of the peace process, continued economic growth and European Monetary Union. As Minister for Social, Community and Family Affairs I am anxious that the fruits of our economic prosperity are shared with the less well off and that the problem of social exclusion is addressed in a meaningful fashion. It goes without saying that we represent the ordinary people of Ireland. However, I want these objectives to be achieved in an atmosphere of public trust and confidence where politics is clearly perceived to be a force for good and justice. The initiatives outlined by the Government will serve to restore that bond of trust and usher in a new era in Irish politics for the new millennium.
I ask the Opposition to accept that the Government has made a genuine effort to strike the best balance possible in formulating the terms of reference. I accept that the Opposition probably has to play politics. Perhaps this is because there are more parties in Opposition in this Dáil than there were in the previous Dáil where it was repeatedly accepted that we provided reasonable and practical opposition. While we opposed some measures we were always constructive in our opposition. Even today the parties opposite have run with the latest agenda set by the media. I will say no more on that issue. The Opposition is doing itself no service by ignoring our efforts to ensure all-party agreement on this issue.
I thank Mr. Justice McCracken and his tribunal team for producing this excellent, succinct, lucid and compelling report. Let nobody be in any doubt that the Government intends to implement fully the recommendations of Mr. Justice McCracken and the recommendations which will be produced by the next tribunal. It also intends to go further.
The McCracken report has been compared with the earlier Hamilton report. The reason the tribunals adopted different approaches in their reports is that different terms of reference were given to them — those given to Hamilton were wide and diffuse, while those given to McCracken were focused. My constituency colleague, Deputy Noonan, claimed credit on behalf of the rainbow coalition for giving more focused terms of reference to the McCracken tribunal. I accept his point but it should be remembered that this was done with the benefit of knowing why the Hamilton tribunal had failed.
The Opposition has proposed a number of amendments to the motion. One amendment in the name of the Fine Gael Party suggests that the tribunal should investigate the then party leader's allowance. The Taoiseach dealt comprehensively with this matter. It is a question of balance. I know the people to whom he referred and their integrity and probity cannot be impeached. I sincerely hope that the Opposition, on reflection, will accept the statements made by those individuals to the Taoiseach.
Like banks, we do not keep records indefinitely and it is extremely difficult to examine some matters. However, the Taoiseach investigated this matter in so far as he possibly could. Again it is a question of focus. If the Opposition wishes to go down this road then it has to be said that Deputy Michael Lowry got money from Ben Dunne not only for himself but also for Fine Gael.
Those payments were investigated.
If we were to provide that the then Fianna Fáil leader's political allowance should be investigated——
They were investigated.
If the Deputy wishes to follow that argument to its logical conclusion, should we not investigate Fine Gael's activities in office to see whether contributions solicited on its behalf influenced decisions taken by its Ministers in office? By logical extension we should ask about the other contributions which brought Fine Gael from a state of bankruptcy when it first entered office in 1994 to a state of financial health. Should we not include a term of reference to ascertain who made those contributions to Fine Gael to restore it to financial health and if they influenced any decision taken by a Fine Gael Minister? If one were to go down that road, one could go down it forever. The tribunal would be unfocused and would not go anywhere. Some balance is required. A tribunal must be reasonably focused to ensure we not only get the information that must be got in the public interest but that it will come to a definitive conclusion in an efficient manner within a reasonable period. That is what the Government has proposed.
As my colleague, Deputy Dermot Ahern, said, the Taoiseach has consulted widely. His openness and willingness to consult widely has been lauded in the public media by the Opposition parties. Like my colleague I am surprised at the tone of some of the contributors to the debate in view of that recognition of the Taoiseach's openness and willingness to consult.
An amendment tabled in the name of the Fine Gael Party proposes consideration of everything relating to the Ansbacher accounts, but the terms of reference of the tribunal must be focused. I remind Deputy Bruton it is a matter for the tribunal, but we have encouraged and let the tribunal know that we wish it to appeal the decision of the court in the Cayman Islands. The Taoiseach has repeated today that the Government will provide every resource necessary for the tribunal to pursue that appeal. Deputy Bruton and others should be mindful that the tribunal we are setting up will be empowered to investigate any payments made from the Ansbacher accounts to Mr. Haughey and to any other person holding political office.
The Leader of Fine Gael has pursued a policy of discarding his former best forever friend, Deputy Lowry, and trying to taint Fianna Fáil with the sins of Mr. Haughey. I can speak as somebody who has been a consistent opponent of Mr. Haughey within the Fianna Fáil establishment. I had my reasons for opposing him, but they are irrelevant now. However, not for one moment did I dream what has been revealed by the McCracken tribunal was going on or anything like it. I assumed and was entitled to do so as was every other Member of Fianna Fáil, that Mr. Haughey had made money from a number of wise property investments in the early 1960s, that he had invested his money wisely and had a good source of income.
I also knew as did Members on all sides of the House, irrespective of whether they may seek to pretend otherwise now, that the Revenue Commissioners live in the real world. They were well aware of the magnificence and opulence of Mr. Haughey's lifestyle. No attempt was made to conceal it. I assumed if Mr. Haughey sent tax returns to the Revenue Commissioners that showed a level of income that could not support his lifestyle, that matter would have been investigated by them. In saying that I am sure I speak for all my colleagues.
We enthusiastically embrace and welcome the report of the McCracken tribunal. This party and Government will not shirk from any action that needs to be taken to restore probity to public life. We are moving to provide a referendum on Cabinet confidentiality, a matter that the previous Government ran away from for two years and now pretends it was difficult to find a formula. Anyone who read the heads of the decision in the Cabinet confidentiality case could have come up with that formula following an hour's reflection. We are taking a number of other measures which have been outlined by my colleagues and I hope this will be the start of a return to probity and a restoration of confidence in Irish political life. It will be a long road during which those of us who have nothing to hide will continue to suffer for the activities of the few.
I admit some surprise and amazement at the attitude of a number of Fianna Fáil Ministers. The Minister for Tourism and Sport, Deputy McDaid, treated us to antiquated language from the 1930s which did not address the issues. I am amazed that Deputy McDaid would accuse Fine Gael of illicit behaviour in putting questions to the Minister for Foreign Affairs at a time when several Fianna Fáil Ministers would like to see bankers revealing the fact that politicians are receiving unusual sums. They would like a permanent ethics commission to deal with allegations, founded or not, to satisfy the public. It is in sharp contrast to the attitude of some Ministers this evening.
There is serious concern about the Ansbacher accounts. Deputy Dermot Ahern genuinely wants consensus and he should look at the Fine Gael amendment as regards the operation of those accounts. The Revenue Commissioners do not have the power to address the Ansbacher accounts in a meaningful manner as we know from page 50 of the tribunal report that the records in Ireland have been destroyed. We also know from the description of how these funds were operated that Irish residents paid money to Mr. Traynor who maintained these accounts overseas. The tribunal expressed considerable concerns about the purpose for which they were used.
The case pursued by the McCracken tribunal in relation to accounts in the Cayman Islands is related to the narrow terms of reference and Judge McCracken cannot expose, on behalf of the Revenue Commissioners, the information Deputy Dermot Ahern suggests he can. The only way in which we can examine the mechanisms by which named Irish people are taking in deposits from Irish individuals, routing them overseas to be re-deposited in Ireland and then delivering instructions as to how those moneys are to be used, is if we authorise this tribunal to look at them.
Will the Deputy give way?
Yes.
Can the Deputy explain why his party and the Labour Party, up to today, did not ask for these matters to be included when they were asked for written comments by the Taoiseach on their amendments to the terms of reference? They are following an agenda.
We would not be having two days of debate if we had established information. The reality is that Fianna Fáil's Leader consulted with other leaders. We signalled at the time that there were a number of issues of concern. We have been working on this issue consistently since and we have availed of this debate to refine advice given to us. We are putting down these amendments in the public interest. The public is concerned that there are systematic mechanisms in place as regards offshore accounts, many of which are legitimate. There are plenty of legitimate reasons for having offshore accounts if one owns a company, but not if one is a private individual. Private individuals are taxable on their worldwide income in Ireland. That is the tax law here. An individual is not entitled to earn income in his own private account — not in a company account — and deposit it overseas while not declaring that to the Revenue Commissioners. That is an illegitimate use of offshore funds. It would appear from these Ansbacher accounts that there is a system in place where that was occurring systematically. The Government should think again.
I have great respect for Deputy Ahern. I have known over a long period that he does attempt to listen to what the other side is saying. Since he has specifically addressed that issue on behalf of the Government in his own contribution, unscripted as it would appear, he should reconsider the matter. He should take it on faith that this is not being put forward by our party for any ulterior motives but because there is a genuine concern that there may be systematic abuse of a mechanism.
Debate adjourned.
The Dáil adjourned at 10.32 p.m. until 10.30 a.m. on Thursday, 11 September 1997.