Dáil Éireann díospóireacht -
Thursday, 29 Jan 1998

Vol. 486 No. 2

Private Members' Business. - Ansbacher Accounts: Motion (Resumed).

The following motion was moved by Deputy J. Bruton on 28 January 1998:

That Dáil Éireann — recalling the serious public concern which arise from the Report of the Tribunal of Inquiry (Dunnes Payments) published on 25 August 1997 which established that irregular payments were made to, and benefits conferred on, certain persons who were Members of the Houses of the Oireachtas between 1 January 1986 and 31 December 1996,

noting that the tribunal established that money was held on deposit in certain Irish banks by offshore banks in memorandum accounts (the Ansbacher accounts) for the benefit of Irish residents including Mr. Charles Haughey (the history of which deposits is set out in chapter 6 of the report of the tribunal),

noting further that the Dunnes payments tribunal was unable by reason of its terms of reference to investigate the source of the Ansbacher accounts, other than in respect of sums paid by certain persons referred to in the said terms of reference,

having regard to additional and serious public concern arising from the circumstances in which up to thirty-eight million pounds were held in the Ansbacher accounts outside the supervision of both the Revenue Commissioners and the Central Bank,

resolves that it is expedient that the tribunal of inquiry established by the Taoiseach pursuant to a resolution passed by the House on 11 September, 1997, should inquire urgently into and report to the Clerk of the Dáil and make such findings and recommendations as it sees fit, in relation to the following additional definite matter of urgent public importance:

the circumstances, considerations and motives relating to the creation, beneficial ownership and management of the Ansbacher accounts, for the purposes of investigating and reporting as to whether there has been any evasion of tax, contravention of exchange controls or other illegal activity associated with those accounts and making whatever recommendations it considers appropriate to prevent such a mechanism being used to avoid the payment of tax or to contravene exchange controls.

and further resolves that the tribunal be requested to conduct these further inquires in accordance with the procedures set out in the said resolution of 11 September 1997, and in particular examine in public hearings, if it so decides, any account holders or beneficial owners of Ansbacher accounts, where there is evidence that there may have been evasion of tax, contravention of exchange controls or other illegal activity associated with these accounts.

Debate resumed on amendment No. 1.

To delete all words after "That" and substitute the following:

"Dáil Éireann —noting the terms of reference of the tribunal of inquiry established pursuant to the Resolutions passed by Dáil Éireann on 11 September 1997, and by Seanad Éireann on 18 September 1997;

—noting that the primary focus of the tribunal is on allegations of irregular payments made to and benefits conferred on certain persons in public life; -noting that the tribunal has already commenced its work and the Attorney General's legal advice that once a tribunal has commenced its work on existing terms of reference that those terms cannot then be changed;

—noting information coming to light as a result of the actions by the Tánaiste and Minister for Enterprise, Trade and Employment under the Companies Act, 1990;

—noting the substantial powers of the Revenue Commissioners, the request by the Minister for Finance to the Revenue Commissioners and his Department to carry out a review of the existing powers in the light of the findings of the Dunnes payments tribunal, and the Government's commitment to provide additional powers where these are shown to be desirable and likely to be effective;

—noting the investigation by the Central Bank of the issues raised by the Dunnes payments tribunal report in relation to exchange control;

—noting that the response of the Central Bank was referred by the Minister for Finance to the Director of Public Prosecutions for his consideration and any action considered necessary, and to the Revenue Commissioners for investigation and any necessary action under the Customs and the Taxes Acts;

—noting that paragraph (p) of the terms of reference of the Moriarty tribunal requires the tribunal to make such recommendations as it considers expedient ‘for the protection of the State's tax base from fraud or evasion in the establishment and maintenance of offshore accounts, and to recommend whether any changes in the tax law should be made to achieve this end',

supports the continuing actions of the Government in pursuing all avenues to investigate these matters in order to protect the revenues of the State and to make the fullest information available to the public.

—(Minister for Finance).

Caoimhghín Ó Caoláin

I support the Opposition motion to widen the terms of reference of the Moriarty tribunal. Apart from the substantive issue which we want the tribunal to address, namely, the Ansbacher accounts, this House should have the ability to amend the terms of reference of tribunals it establishes when it is appropriate to do so. Without investigation of the Ansbacher accounts this tribunal would fail the people and it would be discredited from the outset. The public knows the issue involved has moved far beyond the financial dealings of one or two people. The shady dealings of the golden circle at the pinnacle of Irish society who are unwilling to pay their fair share of tax is what should be under scrutiny. A light has been shone on the activities of some of the most wealthy and privileged people in our society and it should continue to shine on them and the full truth exposed.

A full investigation into and exposition of the Ansbacher affair is the least that is required. The Government is reluctant to allow a completely transparent process of investigation because it feels under an obligation to this greedy sector of the economy. This was shown in the recent budget, with the dramatic cut in capital gains tax and a reduction in corporation tax, thus rewarding some of the least deserving while those most in need were robbed of the benefits of the so-called Celtic tiger.

I am trying to put the Ansbacher issue in context and in that regard I refer to an ESRI survey published in 1997 which shows that this State has the highest proportion of low paid workers in the industrialised world. There has never been a time when company profits and the personal assets of the wealthy were greater, yet they were further boosted by the budget while those who really needed substantial relief were given a pittance in relative terms. The message was clearly sent out that the privileged would be looked after once again. What signal will be sent out now if the Government that introduced such a budget refuses to allow a full investigation into that sector of our society which, not content with the lowest levels of tax on wealth in Europe and the lowest corporation tax, spares no effort to evade taxation due under the law?

The recent focus on a named Irish bank, that included reference to a Member of this House, has addressed only the tip of that iceberg. An examination of the role played by the National Irish Bank in assisting the outflow of investment funds from this economy in avoidance or evasion of tax responsibilities must address all the banking institutions without exception.

I reiterate my support for the motion. It is not just the credibility of the impending inquiry which we are seeking to make full and comprehensive that is at stake but the credibility of all future such inquiries which may be set up by the House.

Mr. McDowell

This debate should not be taking place. We know little more now about the Ansbacher accounts than we did on 11 September last when the Moriarty tribunal was established. At that time the Labour Party and Democratic Left tabled an amendment which would have allowed the tribunal to investigate the beneficial ownership and management of the Ansbacher accounts. The amendment was voted down by the Government parties and failed to attract the support of Fine Gael on that occasion. I am pleased that on this occasion the Fine Gael Party is taking a different view.

Mr. Barrett

The Deputy did not mention our motion to investigate Ansbacher.

Mr. McDowell

We heard the revelations on RTE last Friday regarding the scheme operated by the NIB. There are remarkable similarities between the two operations. Some aspects of the NIB scheme are even more disturbing than the details currently known to us in respect of Ansbacher. All the indications are that the Ansbacher accounts involved a relatively small number of very rich people while the NIB portfolio held at least 178 accounts at the end of last year and I have no reason to believe most of them were not still in place at the beginning of this week.

The beneficial owners of these accounts are not the super rich. The amounts in the accounts are relatively modest by Ansbacher standards. We are talking about middle Ireland, the local businessman, hotelier or garage owner, people involved in cash businesses who ultimately could not resist the temptation to hide some of their earnings from the Revenue. These people do not live in exclusive mansions. They are the middle classes, the respectable business people from all over the country. They are the people who are never short of a few bob, but whose children received grants to go to university. Their names are not known nationally, but they are known to everybody in the communities in which they live.

This is profoundly important and has the capacity to provoke resentment well beyond Ansbacher. We have become cynical about our leaders. It surprised nobody that the super rich found ways to evade tax. Only a few weeks ago the Revenue Commissioners told us many of the richest in our society legitimately use means to avoid tax, including many of the incentive schemes which have proliferated in recent years. What is different about the NIB scheme is that it tells us something about our neighbours; in a sense it obliges us to take a moral stance about our attitude to tax evasion.

As I watched coverage of President Clinton's alleged latest indiscretions on television last night, I saw some young men being invited to cast down upon the alleged moral turpitude of their first citizen and they duly did so. I could not help wondering what those young people would say to their mates in the pub or diner afterwards. I suspect the message might have been somewhat different; they might have a sneaking regard for, or by envious of, the President, combined with the belief that if they were confronted with Ms Lewinsky or somebody of her kind they might not react differently from that of the first citizen.

I cannot help wondering if we do not have a similar tolerance of tax evasion. We condemn it in public but in private we are a good deal less clear. If that is the case, it is time for change. Many people, the majority of whom are in the PAYE sector, could not evade tax even if they wanted to. Those people agreed to low aggregate wage increases as part of the Partnership 2000 agreement and have built the economic success the country is enjoying. The Partnership 2000 approach will be put at risk if the benefits of economic growth are seen to accrue disproportionately to others, at least some of whom are not paying their fair share of tax.

In the case of the National Irish Bank, a good deal of information is available in the public arena and there is no reason matters cannot be brought to a conclusion quickly. In the case of Ansbacher, the information is not yet available and it is imperative that we create a mechanism by which it can be brought into the public arena. If we do not, the public will rightly conclude that we are complicit, wittingly or otherwise, in a cover up. That cannot be allowed.

These latest revelations raise crucial questions about our banking system which has gone through profound changes in recent years. The emergence of the National Irish Bank in its current guise some years ago introduced a new element of competition into the sector. Over the next few years, particularly after monetary union, we are likely to see different players in the Irish market. Some European banks will probably set up here and it is possible that some Irish banks will be taken over by non-national banks.

What we know about the National Irish Bank is different from anything previously known about commercial banks. From time to time in the past individual branches of commercial banks have been found to be involved in improper activities, such as knowingly maintaining accounts in fictitious names, but there has never been proof that any bank was doing this in an organised way.

In the case of National Irish Bank we know that its scheme was devised and operated nationally and we know that a small number of people located in Dublin were dispatched around the country to talk to prospective clients to sell them a product. In some cases the bank or its representatives took the initiative of approaching individuals they thought might be interested. This was not confined to any one branch and the clients were dispersed throughout the country. We cannot be sure that local managers were entirely aware of the exact nature of the product being offered. This was a head office exercise and it is inconceivable that it could have been set up without the active complicity of senior management.

The purpose of the scheme is also clear. There was no particular benefit to the client in terms of interest earned. The commission charged by CMI and NIB was hefty, to say the least. The only benefit to the client was anonymity. This was a way of laundering or hiding money. It may be that some clients had good and legal reasons to hide money, but the overwhelming likelihood is that many were looking to evade tax and the bank knew that.

That one of the biggest banks in the State would be actively involved in touting a product, the primary purpose of which was to assist in the evasion of tax, is bad enough in itself. However, it provokes questions. The bank was and is competing for business — competing, in effect, for people's money. What products are being offered by their competitors? It would be irresponsible of me or anyone else to demand tribunals or investigations in the absence of prima facie evidence and I do not intend to do so. As a general rule we have been well served by the banking system and those who work in it. However, we should not bury our heads in the sand. The activities of Guinness and Mahon with the Ansbacher accounts and National Irish Bank cast a cloud of suspicion over the banking system and something must be done to dispel that cloud.

Hearings before a committee of this House would be an appropriate initial response. We need to hear from the regulatory authorities, the Central Bank, the Revenue Commissioners and the Department of Finance. We also need to hear from the banks. It is incumbent on the commercial banks to assure us as legislators and the public that they are not in the business of actively assisting tax evasion. We cannot and do not expect the banks to act as guardians or guarantors of their clients activities but we are entitled to know whether the banks are actively involved in encouraging tax evasion and in touting products the purpose of which is to help such evasion. To agree to this motion will help to deal with the Ansbacher case but we need to go further to re-establish public faith in the banking system.

We need to be rigorously honest and up front. I wish to say a few careful words about the IFSC because the view is abroad that to question what happens there is tantamount to national sabotage. The annual return to the Exchequer from the IFSC is about £300 million and since the tax is levied at 10 per cent we must assume that the total profits are in the region of £3 billion. We do not know what is the total turnover but we may assume it is a multiple of £3 billion. The income generated in the IFSC represents a significant percentage — perhaps about 10 per cent — of our GNP. By any standards these are staggering figures and they provoke questions about the value added and what goes on in the IFSC.

I have no evidence of wrongdoing or illegal activity in the IFSC. However, many of our European partners are not happy, to say the least, about the activity we encourage by our tax regime in the IFSC. I will say no more than that. Perhaps it is time to ask questions and to shine a light on these areas.

In the first instance I would like to hear from the regulatory authorities. They are open to criticism about the way in which they have dealt with the recent revelations. However, we need to look to the future. We need to establish whether further powers should be given to the Central Bank and the Revenue Commissioners. There is a manifest case for giving a "trawling" power to the Revenue Commissioners to inspect certain accounts or types of account where it is clear or where they have a reasonable suspicion that there is a scam or scheme of the nature operated by NIB. It should not be necessary for them to identify individuals or individual account numbers. They must be given a more general power and my party will propose an amendment to the Finance Bill to that effect.

It is important that those of us in a position of leadership in the House do not become part of a cover up, unwittingly or otherwise. This is the second opportunity the House has been given to ensure a proper investigation of the Ansbacher accounts and I hope we do not lose it.

An Ceann Comhairle

I understand that the Government speakers, who have 30 minute speaking slots, will take only 25 minutes leaving a speaking slot of five minutes for later in the debate.

Mr. O'Malley

I wish to share my time with Deputy Ardagh.

An Ceann Comhairle

Is that agreed? Agreed.

Mr. O'Malley

Before dealing with the specific terms of this motion. I think it appropriate to remind the House of inquiries taking place in another forum. I refer to the appointment by the Tánaiste and Minister for Enterprise, Trade and Employment, Deputy Harney, of an authorised officer to investigate the affairs of a number of Irish companies. In making these appointments, the Tánaiste was invoking powers available to her under the Companies Act, 1990. It is worth dwelling on these powers for a moment as they have an important bearing on the motion before the House.

It is straightforward enough, from information already in the public domain, to chart the chronology of what has transpired to date. First, the tribunal of inquiry into the Dunnes payments — the McCracken tribunal — reported to the Government on 25 August 1997. Arising out of the report, the Tánaiste informed the House on 11 September 1997 that she had some days earlier appointed two officials of her Department to examine the books and documents of Garuda Limited trading as Streamline Enterprises and Celtic Helicopters Limited. More recently, at the beginning of this month, as a result of an interim report of the officer investigating the affairs of Celtic Helicopters, the Tánaiste decided to appoint the same officer to investigate the affairs of two further Irish registered companies, namely, Guinness and Mahon (Ireland) Limited and Irish Intercontinental Bank Limited. Once again these appointments were made under section 19 of the Companies Act, 1990, as was Mr. Ryan's further appointment last week to investigate Ansbacher (Cayman) Limited. The Tánaiste's announcement of the latter appointment seems to have received little or no attention but it is significant. Although this company is registered in Grand Cayman it carries on business in the State and its agents and representatives here, of whom there are several, are subject to the jurisdiction of the authorised officer.

There has been a suggestion that, in appointing an officer at this stage to investigate the affairs of these three banks, the Tánaiste was reacting five months late to the report of the McCracken tribunal. This is not just incorrect and unfair to the Tánaiste, it also displays a lack of knowledge of the powers available under the Companies Acts. The Minister, through an authorised officer, has wide ranging powers under this Act. In particular, she may require the production of books and documents of a company or other body corporate carrying on business in the State if the Minister is of opinion tht there are circumstances suggesting that its affairs are being conducted with intent to defraud or that the body was formed for fraudulent or unlawful purposes.

Section 19 states that an investigation may be initiated if the Minister is of the opinion that there are circumstances suggesting:

that the affairs of the body are being or have been conducted with intent to defraud — the creditors of any other person or that any actual or proposed act or omission or series of acts or omissions of the body or on behalf of the body are or are likely to be unlawful—

Furthermore, an authorised officer has power under section 19 (3) to require the production of books or documents from any person who has possession of them, for example, advisers or consultants. Section 23 of the Act permits access in certain instances to documents relating to the banking affairs of a customer.

It is clear that the Minister may not act unless she has reason to believe that there exist some or all of the circumstances specified in the Act. In appointing officers to examine the affairs of both Garuda and Celtic Helicopters she responded within a fortnight to information contained within the McCracken report. It was not until she received an interim report of the officer in the case of Celtic Helicopters that she was able to form the opinion that further appointments might be necessary. When these facts are considered it is clear that the Minister acted promptly at all times, not just to invoke the powers available under the Companies Acts, but also to perform the duty that those Acts impose on the responsible Minister.

Given the provisions of the Act, it would be unsafe to assume that the simple fact of the appointment of an officer to investigate the affairs of the three banks is in itself an indication of any wrongdoing or unlawful act. The purpose of an investigation under section 19 is to ascertain if there is any basis for concluding that such illegality occurred. We are all aware that attemps were made in the courts on behalf of one of the banks, Irish Intercontinental Bank, to restrain the authorised officer from conducting his investigation. That legal challenge has been withdrawn and the bank has indicated its intention to co-operate fully with the investigation. In view of this, I believe we can assume that the investigation is proceeding in a timely and proper manner. The other bank involved, Guinness & Mahon Limited, was not part of this legal challenge and has, presumably, been co-operating with the authorised officer.

What happens when the authorised officer's investigations are complete? A report will be made to the Minister. It is then open to her to apply to the High Court for the appointment of an inspector under section 8 of the 1990 Act. Such an application may be made to the court ab initio or it may follow the outcome of a section 19 investigation. An inspector has wider powers than those of an authorised officer, including immediate access to the High Court in the event of non co-operation. In addition, an inspector's report may be published. No doubt this is an option which the Minister will keep under review. Seeking the appointment of an inspector under section 8 would be a serious option to be considered if any companies are found not to be co-operating fully with an officer authorised under section 19.

In all cases where wrongdoing is determined, the Minister is permitted to refer the papers to the relevant authorities, for example, the DPP, the Minister for Finance and an officer of the Minister for Finance, such as the Chairman of the Revenue Commissioners or the Central Bank. However, section 19 reports may only be published with the prior approval of the entities examined.

Proceedings in relation to a breach of company law may be brought by either the DPP or the Minister. The Minister may only initiate proceedings within a period of three years of the offence being committed. She is already on record as stating that she regards this limitation as too short. I agree with her and urge that consideration be given to extending it under future amendments to the legislation. Fortunately, no similar restriction appears to apply to prosecutions initiated by the DPP.

In the context of the motion, it is important also to record that the Act allows a section 19 report to be made available to a court of competent jurisdiction. Whether or not this includes the Moriarty tribunal may not be crucial. The tribunal will no doubt exercise its powers to request a copy of any report and no doubt such a request will be complied with.

The House will also be aware that since the publication of the McCracken tribunal report, the Council of the Institute of Chartered Accountants in Ireland decided last October to establish a committee of inquiry under the chairmanship of a retired Supreme Court judge, Mr. Justice Blayney. The purpose of this inquiry is to investigate the professional conduct of certain members of the institute named in the McCracken report. Although such investigations are normally held in private, the Minister was anxious that her Department should be permitted to attend and observe the proceedings of the committee. When the institute indicated that it was not in a position to accede to that request, the Minister acted under section 192(2) of the Companies Act, 1990, to amend the statutory recognition of the institute. This served to require the institute to allow an official from the Department of Enterprise, Trade and Employment to attend and observe the committee's proceedings. The House should commend the Minister's action, not only having regard to the matters of public concern involved, but also bearing in mind her overall responsibilities for company law and for the supervision of the accountancy profession. The work of this committee is ongoing, and, no doubt, it will be possible for it to expedite its work having regard to the obligations of members of the institute to co-operate with its inquiries. The House will be aware that the Institute of Chartered Accountants in Ireland is committed to publishing its report in due course.

The investigations initiated by the Minister with regard to these matters are extremely useful. The powers available under the Companies Act are sufficient to ensure that the authorised officers appointed under section 19 should be in a position to make substantial progress in uncovering possible breaches of company law and of other legislation. Part II of the Companies Act, 1990, which provides the legal power to investigate company operations, is standing up well to the demands of the last few months. It is now of vital importance that the investigations under way should be allowed to proceed unhindered and without the distraction of outside influences. The authorised officer should be allowed to complete his investigations in proper accord with the powers vested in him under the Companies Act and in a manner that is equitable and fair to all the parties involved.

With this as background to the debate, I wish to elaborate on why the House should oppose any extension of the terms of reference of the Moriarty tribunal. First, and most importantly, I understand that the Government has received firm legal advice that it is not possible for the Oireachtas to alter the tribunal's terms of reference now that it has been established. Nowhere in the Tribunals of Inquiry (Evidence) Acts, 1921 and 1979, is there an express power to amend an order which has already been made. It was because of the absence of this power that the order made by the previous Taoiseach establishing the McCracken Tribunal included in paragraph (b) the possibility that Dáil and Seanad Éireann could extend by further resolution the terms of reference of that tribunal. No similar provision was included in the order establishing the Moriarty tribunal and consequently I do not believe that it is now legally possible to change the terms of reference of the tribunal.

Second, the inquiries initiated by the Tánaiste and Minister for Enterprise, Trade and Employment cover many of the elements of the extended terms of reference which Deputies on the Opposition benches wish to impose on the tribunal. There is little benefit in duplicating that work by having the Moriarty tribunal cover the same grounds. The results of these separate investigations will be made available on request to the Moriarty tribunal to assist it in the areas of inquiry relevant to its terms of reference.

It is already the case that Mr. Justice Moriarty has a very large body of work to cover. He must deal with almost 20 years of Mr. Haughey's life. For almost ten of those years he occupied the powerful posts of either Taoiseach or Minister. The tribunal is also being asked to advise on a wide range of other issues, including the performance of the Revenue Commissioners, the Central Bank and the accountancy profession as well as dealing with the large body of legislation which relates to companies and taxation. This is a huge field of work and it would be inappropriate to add further burdens to Mr. Justice Moriarty at this stage even if it were legally possible for the Oireachtas to do so. He should be allowed complete his work without further interference from the Oireachtas.

The work of the Moriarty tribunal, coupled with the investigations which are being undertaken elsewhere, will permit us to get to the bottom of the Ansbacher accounts. The most important information will come into the public domain in due course in a manner consistent with the law. Accordingly, I see no reason to extend the terms of reference of the Moriarty tribunal or indeed to establish a new tribunal of inquiry. I hope the Opposition parties will be able to accept the legal advice made available to the Government prohibiting an extension of the terms of reference. I also hope that they will be able to accept the Government's bona fides in uncovering, and in seeking the prosecution of, any offences under company law or any other legislation which are discovered in the current investigations.

The present enthusiasm of the Opposition parties for tribunals of inquiry is touching. It is in stark contrast to their attitude when they were in Government. In 1996 the Tánaiste first called for the establishment for what subsequently became the McCracken tribunal.

She was strongly opposed by all three of the rainbow parties and the Progressive Democrats motion to establish a tribunal was voted down. That motion was resisted in particularly colourful and intemperate language by Deputy De Rossa, if I recall correctly. He said the establishment of a tribunal would be a recipe for putting journalists in jail but nothing could be further from the truth. It did not suit the rainbow Government to establish a tribunal of inquiry at that stage because it thought the main subject of the inquiry would be one of its own Ministers, Deputy Michael Lowry. Its enthusiasm for a tribunal grew once it learned that Mr. Haughey's affairs would figure prominently also.

Mixing law and politics is a dangerous thing. The Tánaiste has sought to ensure that the corporate laws are properly enforced, without fear or favour to anyone. That is as it should be. There should be no golden circles or platinum circles, or any other kind of privileged circles. Everybody must obey the laws of the land, including its tax laws. If there are grounds for real suspicion of wrongdoing, it must be investigated and the appropriate action taken.

Many commentators are drawing parallels between Ireland's Celtic tiger and the former tiger economies of South East Asis and pointing out similarities between our situation and theirs. Whatever about the similarities — and I am not sure they are all that great — it is vitally important that we focus on the differences. In many countries in South East Asia corruption was rife, business and political elites enjoyed a privileged existence, virtually above the reach of the law, and corporate transactions were effected in a manner that was neither open nor transparent.

That is not the case here. In my terms as Minister for Industry and Commerce I sought to ensure that the corporate sector abided by the laws and that, where necessary, those laws were modernised and strengthened. The Companies Act, 1990, is now on the Statute Book as evidence of what was achieved at that time. I am confident that my successor in that office, the Tánaiste, will act vigorously and impartially to ensure that that Act is properly adhered to.

I urge the House to reject the Opposition motion and to accept the Government amendment.

Mr. Ardagh

I agree with some of the items in the amendment. Certainly there is serious public concern at the irregular payments that were made and at the irregular payments that were made and at the fact that there is £38 million in the Ansbacher accounts. I do not agree with the proposed method of investigation and it is not right to proceed with this amendment.

This is like an arena of metaphors. Yesterday Ryanair was compared with William Martin Murphy. It would be unfair to compare the proposers of this motion with the Tydings committee of the 1950s. As to which of the first four signatories on the amendment would be Senator Joe McCarthy I leave to other people to decide. Just as that investigation started small, it exploded into a form which eventually did no credit to the system of Government. We have in America the special prosecutor, Kenneth Starr, who has spent £30 million trying to besmirch President Clinton. Effectively it demeans public life and politics.

Last night Deputy Howlin referred to Leona Helmsley and her claim that "only the little people pay taxes". I agree with Deputy Howlin that there should be no immunity from the tax laws for anyone. He also said we must accept that tax evaders are cheating the health and the educational services.

Only last Tuesday a 68-year-old pensioner took his 71 year old wife, who is in the last stages of Alzheimer's disease, to my clinic and asked if she could be given a long-term bed. Fortunately, through the work of other public representatives and the health board, through very caring social workers, she was given a respite bed which she will take until a long-term bed is available. Money is needed and taxes have to be paid to provide the necessary services. I agree whole-heartedly with Deputy Howlin that we need a fair and compliant system of taxation that applies to all. Yesterday Deputy Noonan referred to the associated banks and other financial institutions which hold subsidiaries in the Isle of Man and Jersey and the fact that they have been successful. The statement was left hanging as to the reasons for the success. It is important to realise the increasing internationalisation of trade and business, particularly in the software services, consultancy services, buying and selling. A great deal of business is now done on a cross national basis in Germany, Hong Kong and throughout the world. Irish people are particularly mobile, well educated and business oriented. Business is done through trusts, offshore companies and partnerships. There are legitimate reasons for funds to be held in offshore subsidiaries of associated banks. It is important not to harm the legitimate business of those subsidiaries. To do so would mean that the funds which would otherwise flow into these associated banks would go to subsidiaries of UK and European banks in areas such as the Isle of Man and the Channel Islands.

Where many people have benefited from trusts, partnerships or companies, tax is normally paid on a remittance basis. For example, if a certain sum of money is remitted to Ireland, it would be accepted as being a taxable item. That is the position in most cases. There was a case in the McCracken tribunal where that was not so; money was remitted from an offshore account to an account in Ireland and it is understood from the report that tax was not paid on it. That tax should be paid.

On a European Union basis we have to tackle the matter of tax avoidance on business transacted within Europe to ensure the profits arising are brought into account for tax purposes in a country of the EU. This raises also the question of tax harmonisation among ourselves and our European partners so that the profits do not tend to go to the country which has the lowest rate of tax or to the Isle of Man, Jersey and other areas where there is no tax. We should look at our Companies Acts regarding the formation of offshore companies for use by other nationals. It appears the principal use of offshore companies is to avoid tax.

Deputy Noonan also had an anecdote about a person with £30,000 to invest who was offered an offshore deposit facility at a slightly lower rate of interest than would be offered on an Irish deposit or investment. It is important to realise that in our tax returns — which many people have to return by 31 January — there is a statement which asks if a foreign bank account has been opened, where it has been opened and the name of the intermediary. Under tax law it would be necessary for the person referred to by Deputy Noonan to declare on her tax return the name of the intermediary and where the fund is held. There is a specific item on the tax return on any offshore funds purchased in the preceding year. Something has already happened in the Revenue Commissioners relating to offshore funds that have been sold by National Irish Bank.

The bottom line is that if we do not continue on our present course, there is a risk that the tribunal will be compromised and made less effective.

Mr. Noonan

I am sharing time with my colleague, Deputy Owen.

The McCracken report has thrown light on the so-called Ansbacher accounts. It was clear that Judge McCracken and his team could not investigate them fully. That is the central reason the Moriarty tribunal has been established. The terms of reference passed by the Houses of the Oireachtas last September mandate that tribunal to investigate the Ansbacher accounts to establish if Mr. Haughey or other office holder, past or present, is a beneficiary of the accounts and if any payment was made from the accounts to a Member of the Dáil or Seanad, past or present. In so far as the terms of reference go, they enable the tribunal of inquiry to carry out its primary function, that is, to investigate whether payments were made to politicians through the mechanism of these accounts and to establish if political favours were conferred on anybody as a result of these payments.

When Judge McCracken reported he said he believed that some of these accounts were held for legitimate reasons of trade but clearly indicated that others were held for irregular purposes. Consequently, he raised a wider issue than the issue of political payments, that is, whether these accounts were used for the purposes of tax evasion or to breach exchange control regulations. The Government continues to refuse to allow the Moriarty tribunal to investigate this aspect of the Ansbacher accounts, as was made clear by the Minister for Finance last night.

Fine Gael's position is clear and consistent. It believes the Ansbacher accounts should be investigated, not alone to establish whether payments were made to certain politicians but to establish whether they were used to evade tax or breach exchange control regulations. It believes, however, that persons who are innocent should not be treated in the same fashion as those who are guilty. Judge McCracken drew a distinction in his report between those who had Ansbacher accounts for legitimate trade purposes and those who had such accounts for irregular purposes.

The Moriarty tribunal intends to proceed by way of private sessions. It should be possible to establish on a prima facie basis who was involved in irregularities. For those who were not involved in irregularities, the private sessions should be the end of the matter. Those who were involved in irregularities through the use of these accounts should be subject to full public scrutiny. That is what would have happened if the Government hade not voted down the amendment in my name and that of the Fine Gael Whip, Deputy Barrett, in the debate last September and what will happen if the government fails to vote down the motion. I call on the Independents to act independently and not go along with the Government in a vote which is only in the interests of the Government parties.

Much has been made by some commentators of the fact that I stated during the debate last September the tribunal should not engage in a prurient trawl through the affairs of law-abiding citizens. That is my position and that of Fine Gael. We believe that, as the tribunal does its work, it will become clear, in the private sessions, if some holders of Ansbacher accounts held these accounts for legitimate reasons. If so, that should be the end of the matter. On the other hand, those who may have been guilty of tax evasion or breaches of exchange control regulations should be pursued publicly. That was the intent of the amendment in my name voted down by the Government parties last September.

Judge McCracken stated in his report:

It is not the function of this Tribunal to examine these deposits in any detail, and it may well be that a number of the Irish depositors may have been people engaged in international business which was greatly facilitated by having a sterling account abroad which did not require exchange control permission to operate. No. doubt there were others who deposited the moneys in this way from other motives.

Judge McCracken made a distinction between those who were possibly innocent and those where were clearly guilty. Fine Gael wants to maintain this distinction between possible bona fide account holders and those who were breaking the law. That is the reason it abstained in the vote on the Labour Party motion last September and pressed its own amendment of similar intent which would have required the tribunal to investigate fully account holders where there was a prima facie case of tax evasion or breaches of exchange control regulations. I am glad the motion in the names of the four party leaders in Opposition which seeks to amend the terms of reference maintains this distinction.

Much has been made of the fact that the Fine Gael amendment last September would have required the tribunal to report on the procedures used to evade tax or breach exchange control regulations by the use of these accounts and to make recommendations on how practices such as this in the banks could be brought to an end. Some commentators have argued that this would require the tribunal to investigate irregular account holders in secret without identifying the beneficiaries. This is nonsense as anyone who has a passing acquaintance with the law will understand.

If persons are being investigated for criminal offences by a court or tribunal — breaches of exchange control regulations and tax evasion are criminal offences which carry prison sentences as a penalty — they must be examined publicly. They have a constitutional right to publicly state their side of the story under oath. There are some particular and special cases in the area of family law where proceedings are held in camera but under our judicial system the courts sit in public. Cases are argued and witnesses cross-examined in public. Tribunals have the same power as the High Court and operate in the same manner. It would not have been possible under our amendment proposed last September for the tribunal to operate in private. Persons suspected of tax evasion have to be examined in public session. It suits certain people to pretend they do not understand this and certain political opponents of my party to put a different spin on it.

The Moriarty tribunal was mandated to investigate the political charges that there were political payments for political favours. We wanted the tribunal to investigate whether there were tax evasion and breaches of exchange control regulations while maintaining the distinction between the innocent and the guilty. We abstained in the vote on the Labour Party motion because it did not maintain this distinction and pursued our own amendment to a vote. I do not want anybody rewriting history, as the Minister for Finance attempted to do last night. We are delighted that there is now all-party agreement on this side of the House and that the motion and proposed amendment to the terms of reference maintain the distinction between those who are innocent and those who are possibly guilty of criminal offences. If the Fine Gael amendment had been accepted last September, Mr. Haughey's challenge to the tribunal would have less merit, if any.

The tribunal should investigate the procedures used for tax evasion purposes in the Ansbacher accounts. The issue is much wider than those accounts in Irish Intercontinental Bank. Similar accounts or accounts for similar purposes exist in other financial institutions. That is the reason we drafted, after careful legal advice, an amendment which dealt with the procedures. I did not want to have it confined to a small number of accounts in Irish Intercontinental Bank. The procedures used in other banks should be examined also.

The recent revelations about certain accounts in National Irish Bank bear this out. I have reason to believe other financial institutions have similar arrangements. In the light of what is now emerging about the accounts in NIB, I ask people to look again at what Fine Gael proposed in its amendment in September. That amendment, which was carefully drafted after lengthy legal advice, went to the very heart of the matter, and many of the inquiries now being conducted by the Tánaiste, the Revenue Commissioners and the Central Bank are simply playing catch-up and trying to arrive at the position the Government rejected when it voted down our amendment in September. It will have a second chance at 12.30 p.m.

I ask the Independent Members of this House not to feel constrained or tied to a Government policy position which is illogical and not in the interests of the Irish people. I can understand Independent Members voting to continue a Government in office and avoid an election, but an election does not hang on the result of the vote at 12.30 p.m. To amend the terms of reference, as we have proposed, would make the Moriarty tribunal far more efficient and effective and would get to the heart of the matter much quicker in terms of tax evasion and breaches of exchange controls than any of the other mechanisms outlined on the opposite side of the House.

This House must again declare war on tax evasion. Compliant taxpayers, particularly those on PAYE, are groaning under the fiscal yoke imposed on them by decisions of this House. It is bad enough for compliant taxpayers to feel they are paying too much tax. It is worse when there is incontestable evidence that there are others who, through a variety of arrangements, can evade their responsibilities and pay nothing or virtually nothing. It will be a national disaster if it transpires that respected financial institutions are actively aiding and abetting schemes such as this.

The Government must establish the truth. It is being given an opportunity today to establish the truth in the most effective possible way if it accepts this change to ther terms of reference. It should take that opportunity and not come into the House with a series of fig leaf arrangements processed through the Tánaiste's office designed to hide its embarrassment and not put efficient schemes in place.

Deputy McCreevy is a strange Minister. It is clear that the first two or three pages of all his scripts are written by some politically motivated person, and then we get to the real speech written by the officials in the Department of Finance. Much of the time the Minister seems to be quite familiar with the first two pages of a script but after that he seems to be as surprised as his listeners by the contents of the remainder of it.

Mrs. Owen

He had not read it.

Mr. Noonan

In the initial political stages of his speech yesterday — the bit stapled up front to get the sound bite — there seems to be no scrutiny whatsoever. Anything goes and any piece of fantasy can be promulgated as a fact. The Minister stated that not only did Fine Gael vote to establish the Moriarty tribunal on the basis of its present terms of reference but opposed any suggestion that those terms of reference might be extended or altered.

Mrs. Owen

That is not true.

Mr. Noonan

The Minister sat in front of me throughout the day as I and Deputy Barrett proposed and voted on amendment after amendment to change the terms of reference, including an amendment which had the support of all the parties in Opposition which would have enabled Moriarty investigate the Ansbacher acounts to determine if they were being used for tax evasion purposes or to breach exchange control regulations. Yet the Minister for Finance can seriously read this speech into the record of the House. Are we living in the real world? I have never heard a Minister for Finance, in the initial stages of a contribution, weave a web of fantsy and mislead the House in the manner in which this Minister has done. I would say they were downright lies but that is unparliamentary language and the Chair would require me to immediately withdraw the remark. The Minister should be more careful about the charges he lays when they are blatantly untrue. I wish to share the remainder of my time with my colleague, Deputy Owen.

Mrs. Owen

I thank my colleague for sharing time with me. As Deputy Noonan said, Deputy McCreevy is a past master in finding some sound bite to begin his contribution, and then we hear the rest of it. In the early stages of his speech the Minister did everything in his power to find a way not to accept the motion tabled by Fine Gael and the other Opposition parties. I remember the reason Deputy McCreevy became so well known. He was lauded for having the courage to go outside his own party and speak out against Charles Haughey, which he believed was the right thing to do, when others remained silent. He has suddenly rolled over now and his tummy is being scratched by being in Government.

Mr. Cullen

That is certainly not the case, and the Deputy knows it. I can vouch for that.

Mrs. Owen

We no longer see that courage or wisdom for which he received such praise in the media and which made him the darling of the Gay Byrne and Pat Kenny shows. Deputy McCreevy was always asked for his view because he was known for speaking out but now, as Minister for Finance, he has dropped that courageous attitude.

Mr. Cullen

Not true.

Mrs. Owen

It is interesting that the Minister pilloried Fine Gael yet said that the Government will propose setting up a tribunal of inquiry in any circumstances that justify it. I cannot think of any other circumstance more justifiable than the one on which we are putting forward this motion to amend the tribunal's current terms of reference.

Deputy Bruton said last night that the Government is hiding behind advice to the effect that the terms of reference of the tribunal cannot be amended now that it has been set up. The tribunal is a creature of this Parliament and we can, under the 1921 Act, amend its terms of reference if we so wish because that Act contains the clause ". or any instrument supplemental thereto may provide that this Act shall apply, and in such cases the tribunal shall have all powers, rights and privileges as requested in the High Court". Clearly the Act envisaged that as the work of a tribunal proceeds, something may arise that would allow it have its terms of reference extended.

I have no doubt that if anybody had knwledge of the Ansbacher accounts when the McCracken tribunal was being set up by the former Government last year — that information only emerged in the course of the tribunal — we would have included those accounts for examination by the tribunal. However, because of the way Mr Justice McCarcken was working it was clear he could not proceed to examine the Ansbacher accounts unless they directly related to the politicians mentioned. The time has come for this Government to stop hiding behind a fudge that appears to be action but in reality is inaction.

Mr. Cullen

Nonsense.

Mrs. Owen

The Government states in its amendment that it notes information coming to light as a result of the actions by the Tánaiste and Minister for Enterprise, Trade and Employment under the Companies Act. This is the same Deputy Harney who said in the debate last September that a tribunal which has a narrow focus on a few specific areas runs the risk of requiring us to come back in a few months' time to establish a third inquiry. If the Tánaiste were still sitting in her Opposition seat she would be shouting and screaming that the Government was trying to hide something or that the large parties had something to hide because they would not allow the Ansbacher accounts be examined. She, too, has rolled over.

It is interesting that Deputies Harney and McCreevy, the two people who made their political reputations by shouting and roaring about honesty and integrity in politics, are the lead players in refusing to accept this amendment. They should take the opportunity now, before the Moriarty tribunal gets deeper into its work, to make the necessary amendments so that the public can have confidence restored in both the political system and the financial system.

We do not know the truth of this, but too many taxpayers who have to pay their share of tax are disgusted that there may be people who have made a good deal of money on their backs and are getting away with using tax evasion methods through the use of offshore accounts. As Deputy Noonan said, we as a party did not want to imply that anybody with an offshore account was breaking the law. It is necessary to ensure there is prima facie evidence that somebody is using such a system in the banking world to evade tax or to breach exchange controls. That is why we tabled this motion.

I cannot understand why members of the Government have not been able to convince the Taoiseach that this motion should be accepted, because when the Moriarty tribunal was being set up he discussed the matter with the leaders of the other parties and came to the Dáil to thank them for their co-operation, although he ignored what they had to say. What is going on between Fianna Fáil and the Progressive Democrats that they do not realise it is not just in the interests of the Opposition that this motion be accepted but it is in their own interests as parties to ensure they cannot be accused of hiding something or ensuring information that may be embarrassing to them is not uncovered? It does not matter who may be embarrassed by that information. We must ensure that integrity is maintained and that the public can be sure no wrongdoing is being hidden.

I do not know whether the Minister, Deputy Harney, will participate in this debate. She closed the previous debate on this matter. Throughout her speech on that occasion, as reported at column 825 of the Official Report of 11 September 1997, she stated:

Elaborate concealment through offshore accounts and other such devices is a recognition both by the donors and the recipients of the impropriety of what they are doing. Those complex financial webs were obviously woven to evade tax.

She went on to state: "The terms of reference proposed for the new tribunal are as comprehensive and well-drafted as they can be." She knows from her own investigations and from the information that emerged that they are not drafted as widely, comprehensively and well as she said they were in September. It is now time for her to push the Taoiseach to accept this motion. She should use her power as a partner in Government and ensure she does not hide behind section 19 of the Companies Act in this investigation. Sections 19, 20 and 21 of the Companies Act, 1990, make it clear that the investigation being carried out by the Tánaiste will not lead to disclosure of the people who have been using these offshore accounts to evade tax or to breach exchange controls. It states that the reports and the information gathered cannot be made public. It is difficult to ascertain the reason the Tánaiste is hiding behind the Act she is charged with the responsibility to implement. Naturally when there is silence as to why the Government will not allow these Ansbacher accounts to be examined by the tribunal there will be rumour and innuendo. That is not good. I do not know if the Government has had second thoughts about this and whether it will vote down this motion in a bullheaded way. I hope the Independents who are being mollycoddled and minded by the Government will show their strength. One reporter made a plea to one of the Independents to make a name in this House. They should have the courage the Ministers, Deputies McCreevy and Harney, were purported to have over the years which made them such household names. The Independents should have the courage to vote with the Opposition on this motion and send a message to the Government that the politicians elected to this House want to see any wrongdoing exposed.

I am glad Deputy Noonan put to rest the attempts by the Minister, Deputy McCreevy, and Government spokespersons, publicly and in private briefings, to besmirch the name of Fine Gael to the effect that we did not want to amend the terms of reference last September. We did and the evidence to prove that is in the Official Report. We voted to make sure that these Ansbacher accounts were examined to ensure that if there was prima facie evidence of tax evasion that it would have to be examined in public. The terms of reference allow the judge to examine all issues in private and on finding information that requires public consideration to proceed with that. The Minister of State who is present was a member of the Progressive Democrats. He jumped ship and for the moment he seems to be staying in the arms of Fianna Fáil.

Mr. Cullen

The Deputy should get up to speed. Has she nothing new to add? That remark is pathetic.

Mrs. Owen

I am surprised the Minister of State has not seen the wisdom of this motion from the point of view of how it will benefit the party of which he is a member in ensuring there is no criticism of it. If the Government does not accept this motion, it will be shown to have made the wrong decision and in a few months' time it will have to reconsider what it did in voting it down. It will have to come back to this matter and set up another tribunal or extend this tribunal's terms of reference.

When the tribunal continues its work, public pressure will be such that the Government will have to examine the Ansbacher accounts. Whatever about there being any excuse last September for the Government to vote down amendments put forward by the Opposition, if it wanted any further indication that there is a need for it to have the courage to accept this Opposition motion, that is indicated by the more recent information about the National Irish Bank and the alleged accusations that approximately 180 to 200 people have used offshore accounts to evade tax.

It is not a sign of weakness for a Government to accept an Opposition amendment. When we were on the benches opposite for two and a half years there were many occasions when Deputy Bruton as Taoiseach was willing to accept the Opposition's opinion on matters. We accepted amendments to many Bills. We did not think that was weakness on our part but rather the way parliamentary democracy is supposed to work.

If the Government is worried that if it accepts this motion it will appear to be backtracking on something it did not do last September, it should not be afraid. It will receive the thanks of the public for having the courage to accept the collective advice and wisdom of the Opposition parties that the tribunal's terms of reference should be amended before it becomes deeply involved in its work. It will be a bad day for our democracy and for all Members if the Government is seen to vote down this motion. Pushing through its amendment by giving three Independents something special to keep them quite for the day or giving them a pairing arrangement and allowing them to go off down the country is not the way to run this democracy.

The public expect this matter to be examined. They will not be satisfied with what the Minister, Deputy Harney, is doing because the examination under section 19 of the Companies Act, 1990, will not be sufficient to ensure people who have abused the mechanism of offshore accounts will be brought to justice and exposed. It is not just the politicians who should be exposed. Mr. Haughey and Deputy Lowry who have been the subject of the McCracken tribunal have done wrong and they must be exposed, but we must also ensure that leading people here who have made money and who may also be responsible for creating jobs cannot break the law at the expense of others. They are obliged to pay taxes like every other person, from those who earn £11,000 per annum or £12,000 per annum to those who earn six figure sums or more. I hope, even at this eleventh hour, that the Minister of State, Deputy Cullen, will give a message to the Government that they must support this motion.

Minister of State at the Department of Finance (Mr. Cullen)

I listened with interest and in amazement to the remarks of Deputy Noonan and Deputy Owen. I reject the central tenet of their argument that the Government is trying to hide the truth. Nothing could be further from the truth and, irrespective of their desire to make legitimate Opposition points — Deputy Noonan made some reasonable comments — it is grossly wrong of the Deputies to suggest otherwise. Their arguments were spoiled by the concluding remarks of Deputy Owen in particular.

We should be clear about the establishment of the Moriarty tribunal. The former Taoiseach is present and he is aware the Government received strong legal opinion that it would be extremely foolish to interfere with the terms of reference as originally set. Is it the basis of the Opposition's argument that when tribunals are established in the future and other matters emerge after the terms of reference are set, Members can table motions in the House to amend the terms of reference?

Mrs. Owen

Yes, if they are relevant.

Mr. Cullen

There would not be a shred of credibility attached to any future tribunal in those circumstances. This also applies to the current tribunal which has an enormous amount of work to carry out. It would be a bad day's work if that was the basis of tribunals established by the House.

The Government believes the position is sacrosanct once the terms of reference of a tribunal have been set. Once people become involved with a tribunal, they should not be subject to the whims of Members of the House who attempt to change the terms of reference and the original criteria of the investigation because other factors emerge. The consequences of the factors will be dealt with once a tribunal has concluded and its report is available. It may be necessary to take other action and the appropriate steps will be taken at that stage. The Government is intent on ensuring that the truth of these issues is made available to the public. That will happen.

Mrs. Owen

In that case the Government should accept the amendment.

Mr. Cullen

The Deputies referred to the Companies Act as if it were Mickey Mouse legislation. The Deputies are former Ministers and Deputy Noonan spent much time over many years putting in place the Companies Act to ensure the work carried out by the inspectors would achieve results. The current investigation, instituted by the Tánaiste, has already achieved results. The powers under the Act are having the required effect. I reject the suggestion that the Government has taken a dismissive approach to these matters.

The Minister last night on the Adjournment spelt out the measures being taken, including the action under insurance law taken by the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Treacy. The Tánaiste has also acted under the Companies Acts to investigate possible breaches of those Acts. There is no intention on the Government's part to shield wrongdoers from publicity. However, we must strike a balance. It is a matter for the Oireachtas to decide if further powers should be given to the Revenue Commissioners and others. This is a matter of judging what promotes the public good and what will be effective in doing so. This judgment is best made when all the evidence is available from the Moriarty tribunal, the company inquiries and the ongoing examinations by the Revenue Commissioners and the Central Bank of the latest allegations.

These investigations are in place and all the powers under the law are being examined. The full rigours of the law are being brought to bear. The Fine Gael Party in particular appears to think that we should abandon course midway and add new terms of reference. It wants to change the criteria to deal with emerging facts. However, these facts will be covered by the different areas to which I referred. If any other matters arise which require further investigation by any other means, the Government will ensure they are investigated and the public is made aware of the facts.

Mr. J. Bruton

I said yesterday that I believed the Government was sincere in its views on opposing a change. I did not believe there was any malicious or malevolent purpose in its approach and that it genuinely believed the legal advice it received. However, having listened to one of the worst speeches ever from a Minister for Finance on any topic, I have changed my mind. Having listened to the Minister for Finance's superficial address, and although it goes against the grain, I have formed the view that perhaps there is another agenda at work.

Mr. Cullen

That is not true. It is grossly unfair of the Deputy to suggest it.

Mr. J. Bruton

I could not conceive that a Minister, who was well prepared for a debate which he knew for several weeks would be held, could prepare such a bad, poorly argued and poorly founded speech. That makes me suspicious.

The Government spokesman originally stated that the terms of reference could not be extended. However, the Minister for Finance slightly modified it yesterday and suggested that probably they could not be extended but if they could, it would not be a good idea. It is surprising in itself that the Government has such imprecise understanding of its legal advice. I wish to state categorically that the terms of reference of a tribunal in being can be amended by the House.

The Tribunals of Inquiry Act, 1921, refers to the terms of reference of a tribunal being contained either in the resolution establishing it or in a supplemental instrument. This means there could be an instrument to supplement the terms of reference of a tribunal. This is stated in the Tribunals of Inquiry Act, 1921. The amendment of terms of reference was envisaged in the principal legislation approved in 1921.

The terms of reference of this tribunal require it in its interim report to address the question of other matters which could be dealt with, including the terms of reference explicitly mentioned. What was the point of including in the remit of the tribunal the possibility of referring to its terms of reference in an interim report if it was not with a view to remedying any deficiencies which might exist in the terms of reference? If the deficiencies were remedied, the only way it could be done would be by an amendment to the terms of reference. The terms of reference of the Moriarty tribunal contain material evidence to suggest that the Minister is wrong in saying that it is not possible to amend the terms of reference. They envisage the possibility of the terms of reference being amended.

It is interesting that the Minister for Finance did not say yesterday that he had consulted Mr. Justice Moriarty about this matter. On a previous occasion when the Government argued that the terms of reference of another tribunal could not be altered, it received public advice from its chairman, Mr. Justice McCracken, that he did not want the terms of reference amended. It is interesting on this occasion that the Minister did not refer to consulting Mr. Justice Moriarty. He did not say that Mr. Justice Moriarty had advised against amending the terms of reference or that the Chief State Solicitor had consulted the legal team advising Mr. Justice Moriarty. If the Government was confident in its view that a term of reference could not be altered, it would have sought to obtain the advice of the tribunal itself on the matter. However, it did not do so. This is evidence that the Government knew if it did so it would not receive the answer it sought. They would not get an answer from Mr. Justice Moriarty to the effect that he objected to an amendment to the terms of reference. It was very significant that the Minister for Finance did not refer to consulting the tribunal about this when he spoke. The absence of such a reference is evidence of potential bad faith on the Minister's part in his approach to this matter.

The Minister was also wrong in law when he stated that terms of reference cannot be amended. Apart from the reasons I have already given, I have consulted foreign authorities on this subject. The common law jurisdiction which has had tribunals most frequently is Australia. The authoritative Australian book on that subject is "Royal Commissions and Boards of Inquiry: Some Legal and Procedural Aspects" by Leonard Arthur Hallett. I refer the Minister for Finance and the Attorney General to page 55, which clearly states that terms of reference in that common law country, where the law is the same as here, can be amended. Mr. Hallett cites evidence in support of that view, and the Minister for Finance is wrong.

It is also significant that the Minister did not produce the legal advice he received. He referred mysteriously to legal advice but did not produce it. There are precedents for the legal advice of Attorneys General being produced. When Mr. John Murray was Attorney General his advice on a matter was produced in the House. However, the Minister for Finance did not care to produce Mr. David Byrne's legal advice on the matter, possibly because that advice is not as categorical as the political statements being made by the Minister in the House. Having listened to him, I have serious doubts about the integrity of the Government's approach on this matter. I say that having stated, before I heard the Minister, that I believed he was acting in good faith. I am not so sure now I have heard the very bad speech he made.

The Minister tried to hide behind the fact that the terms of reference already contain a term which requires it to report on how the State's tax base might be protected from fraud or evasion through the establishment and maintenance of offshore accounts as well as recommending changes to that end. How is that tribunal to reach a meaningful conclusion on that when it is not allowed to investigate tax evasion? It is not possible for the tribunal to make a recommendation on how to deal with tax evasion if it is not allowed to investigate tax evasion. One cannot discover how much tax evasion there is unless one investigates the actions of individuals. The Minister says the tribunal should investigate tax evasion and make recommendations on that. He also says the tribunal cannot investigate individuals who have evaded tax. That is a contradiction in terms. It is not possible for a tribunal to make any recommendation about tax evasion unless it investigates individual cases to discover what methods were used. The Government's refusal to accept the Opposition amendment renders null and void one of the existing terms of the Moriarty tribunal and prevents that tribunal from fulfilling the provisions of paragraph p. The tribunal is being prevented from getting the relevant information needed to make a recommendation on the matter.

A large amount of money passes through overseas accounts. I recently read a United Nations report on how the drugs trade is maintained, and it identified the use of offshore accounts as a way of laundering drug money. It drew attention to the fact that the banking deposits in the Cayman Islands are almost as large as the banking deposits in Germany. This little piece of desert in the Caribbean has a bank deposit base as big as Germany's. All but five of the 100 banks there have no residential existence in the Cayman Islands. It is a place used for paper transactions to evade inquiry. Action must be taken, or the tax base of all civilised states will be destroyed in the next ten to 15 years. These tax havens are international pirates which prey on the ability of civilised states to provide decent services for people. Unless they are dealt with, we will not be able to control the drugs trade. We will not be able to maintain the capacity of states to function because sophisticated information technology, such as the Internet, will be used to extend the type of systematic tax evasion now being availed of by a few favoured customers of some banks. It will be made available to the broad mass of people to evade tax. This is a very serious issue facing democratic States and could lead to the nation-State being undermined as a fiscally viable entity if it is not dealt with.

If Deputy Noonan's suggestions are true, then it is not simply a question of the managing director of National Irish Bank committing a crime. Everybody involved in selling that financial scam committed a crime. There is a clear obligation on anybody aware of tax evasion to bring it to the attention of the authorities.

Mr. Cullen

The Deputy should not be so presumptuous.

Mr. J. Bruton

This matter should be considered very carefully. If the facts as stated are true, those involved are promoting tax evasion and crime. It is important that the law be seen to apply at every level. We do not want people to make the claim that they were only obeying orders. The law clearly states that everyone has an obligation as a citizen to report such malfeasance.

The results of the Tánaiste's inquiry cannot be published or be referred to the Moriarty tribunal. Deputy O'Malley seemed to suggest it could, but it cannot. Section 19 binds the Minister to keep it confidential other than giving the results to specified persons, and the tribunal is not one of those specified. If the Tánaiste wanted to give the tribunal the report or the tribunal asked for it, it cannot be given.

Mr. Cullen

It is not that definite.

Mr. J. Bruton

It is suggested that the tribunal report could be referred to the Director of Public Prosecutions. I remind Deputy Cullen of what happened when the beef tribunal report was referred to the Director of Public Prosecutions. This issue cannot wait for the long, turgid and doubtful process the Tánaiste has set in motion. I do not criticise her; Deputy O'Malley appeared to defend her against attacks which had not been made against her. I believe the Tánaiste has done all she can as Tánaiste and Minister for Enterprise and Employment, but she has not done all she can as a member of the Government. In that capacity she should have argued for the acceptance of this motion. This is a quicker, more open and more effective way of dealing with the issue.

Amendment put.

The Dáil divided: Tá, 75; Níl, 70.

Tá

• Ahern, Bertie.
• Ahern, Dermot.
• Ahern, Michael.
• Ahern, Noel.
• Ardagh, Seán.
• Blaney, Harry.
• Brady, Johnny.
• Brennan, Matt.
• Brennan, Séamus.
• Briscoe, Ben.
• Byrne, Hugh.
• Callely, Ivor.
• Carey, Pat.
• Collins, Michael.
• Cooper-Flynn, Beverley.
• Coughlan, Mary.
• Cowen, Brian.
• Cullen, Martin.
• Davern, Noel.
• de Valera, Síle.
• Dempsey, Noel.
• Dennehy, John.
• Doherty, Seán.
• Ellis, John.
• Fahey, Frank.
• Fleming, Seán.
• Flood, Chris.
• Foley, Denis.
• Fox, Mildred.
• Hanafin, Mary.
• Harney, Mary.
• Haughey, Seán.
• Healy-Rae, Jackie.
• Jacob, Joe.
• Keaveney, Cecilia.
• Kelleher, Billy.
• Kenneally, Brendan.
• Killeen, Tony.
• Kirk, Séamus.
• Kitt, Michael.
• Kitt, Tom.
• Lawlor, Liam.
• Lenihan, Brian.
• Lenihan, Conor.
• Martin, Micheál.
• McCreevy, Charlie.
• McDaid, James.
• McGennis, Marian.
• McGuinness, John.
• Moffatt, Thomas.
• Molloy, Robert.
• Moloney, John.
• Moynihan, Donal.
• Moynihan, Michael.
• Ó Cuív, Éamon.
• O'Dea, Willie.
• O'Donnell, Liz.
• O'Flynn, Noel.
• O'Hanlon, Rory.
• O'Keeffe, Batt.
• O'Keeffe, Ned.
• O'Kennedy, Michael.
• O'Malley, Desmond.
• O'Rourke, Mary.
• Power, Seán.
• Roche, Dick.
• Ryan, Eoin.
• Smith, Michael.
• Treacy, Noel.
• Wade, Eddie.
• Wallace, Dan.
• Wallace, Mary.
• Walsh, Joe.
• Woods, Michael.
• Wright, G.V.

Níl

• Allen, Bernard.
• Barnes, Monica.
• Barrett, Seán.
• Bell, Michael.
• Belton, Louis.
• Bradford, Paul.
• Broughan, Thomas.
• Browne, John (“Carlow-Kilkenny).
• Bruton, John.
• Bruton, Richard.
• Burke, Liam.
• Burke, Ulick.
• Carey, Donal.
• Clune, Deirdre.
• Connaughton, Paul.
• Cosgrave, Michael.
• Coveney, Hugh.
• Crawford, Seymour.
• Creed, Michael.
• Currie, Austin.
• D'Arcy, Michael.
• De Rossa, Proinsias.
• Deasy, Austin.
• Deenihan, Jimmy.
• Dukes, Alan.
• Durkan, Bernard.
• Farrelly, John.
• Ferris, Michael.
• Finucane, Michael.
• Fitzgerald, Frances.
• Gilmore, Éamon.
• Gormley, John.
• Gregory, Tony.
• Hayes, Brian.
• Higgins, Jim.
• Higgins, Joe.
• Higgins, Michael.
• Howlin, Brendan.
• Kenny, Enda.
• McCormack, Pádraic.
• McDowell, Derek.
• McGahon, Brendan.
• McGinley, Dinny.
• McGrath, Paul.
• McManus, Liz.
• Mitchell, Gay.
• Mitchell, Jim.
• Mitchell, Olivia.
• Naughten, Denis.
• Neville, Dan.
• Noonan, Michael.
• Ó Caoláin, Caoimhghín.
• O'Keeffe, Jim.
• O'Shea, Brian.
• Owen, Nora.
• Penrose, William.
• Perry, John.
• Quinn, Ruairí.
• Rabbitte, Pat.
• Reynolds, Gerard.
• Ring, Michael.
• Sargent, Trevor.
• Sheehan, Patrick.
• Shortall, Róisín.
• Spring, Dick.
• Stagg, Emmet.
• Stanton, David.
• Timmins, Billy.
• Wall, Jack.
• Yates, Ivan.

Tellers: Tá, Deputies S. Brennan and Power; Níl, Deputies Barrett and Stagg

Amendment declared carried.

Question put: "That the motion, as amended, be agreed to."

The Dáil divided: Tá, 75; Níl, 69.

Tá

• Ahern, Bertie.
• Ahern, Dermot.
• Ahern, Michael.
• Ahern, Noel.
• Ardagh, Seán.
• Blaney, Harry.
• Brady, Johnny.
• Brady, Martin.
• Brennan, Matt.
• Brennan, Séamus.
• Briscoe, Ben.
• Byrne, Hugh.
• Kitt, Michael.
• Carey, Pat.
• Collins, Michael.
• Cooper-Flynn, Beverley.
• Coughlan, Mary.
• Cowen, Brian.
• Cullen, Martin.
• Davern, Noel.
• de Valera, Síle.
• Dempsey, Noel.
• Dennehy, John.
• Doherty, Seán.
• Ellis, John.
• Fahey, Frank.
• Fleming, Seán.
• Flood, Chris.
• Ó Cuív, Éamon.
• O'Dea, Willie.
• O'Donnell, Liz.
• O'Flynn, Noel.
• O'Hanlon, Rory.
• O'Keeffe, Batt.
• O'Keeffe, Ned.
• O'Kennedy, Michael.
• O'Malley, Desmond.
• O'Rourke, Mary.
• Foley, Denis.
• Fox, Mildred.
• Harney, Mary.
• Haughey, Seán.
• Healy-Rae, Jackie.
• Jacob, Joe.
• Keaveney, Cecilia.
• Kelleher, Billy.
• Kenneally, Brendan.
• Killeen, Tony.
• Kirk, Séamus.
• Callely, Ivor.
• Kitt, Tom.
• Lawlor, Liam.
• Lenihan, Brian.
• Lenihan, Conor.
• Martin, Micheál.
• McCreevy, Charlie.
• McDaid, James.
• McGennis, Marian.
• McGuinness, John.
• Moffatt, Thomas.
• Molloy, Robert.
• Moloney, John.
• Moynihan, Donal.
• Moynihan, Michael.
• Power, Seán.
• Roche, Dick.
• Ryan, Eoin.
• Smith, Michael.
• Treacy, Noel.
• Wade, Eddie.
• Wallace, Dan.
• Wallace, Mary.
• Walsh, Joe.
• Woods, Michael.
• Wright, G.V.

Níl

• Allen, Bernard.
• Barnes, Monica.
• Barrett, Seán.
• Bell, Michael.
• Belton, Louis.
• Bradford, Paul.
• Broughan, Thomas.
• Browne, John “(Carlow-Kilkenny).
• Bruton, John.
• Bruton, Richard.
• Burke, Liam.
• Burke, Ulick.
• Carey, Donal.
• Clune, Deirdre.
• Connaughton, Paul.
• Cosgrave, Michael.
• Coveney, Hugh.
• Crawford, Seymour.
• Creed, Michael.
• Currie, Austin.
• D'Arcy, Michael.
• De Rossa, Proinsias.
• Deasy, Austin.
• Deenihan, Jimmy.
• Dukes, Alan.
• Durkan, Bernard.
• Farrelly, John.
• Ferris, Michael.
• Finucane, Michael.
• Fitzgerald, Frances.
• Gilmore, Éamon.
• Gormley, John.
• Gregory, Tony.
• Hayes, Brian.
• Higgins, Jim.
• Higgins, Joe.
• Higgins, Michael.
• Howlin, Brendan.
• Kenny, Enda.
• McCormack, Pádraic.
• McDowell, Derek.
• McGahon, Brendan.
• McGinley, Dinny.
• McGrath, Paul.
• McManus, Liz.
• Mitchell, Gay.
• Mitchell, Jim.
• Mitchell, Olivia.
• Naughten, Denis.
• Neville, Dan.
• Noonan, Michael.
• Ó Caoláin, Caoimhghín.
• O'Keeffe, Jim.
• O'Shea, Brian.
• Owen, Nora.
• Penrose, William.
• Perry, John.
• Quinn, Ruairí.
• Rabbitte, Pat.
• Reynolds, Gerard.
• Ring, Michael.
• Sargent, Trevor.
• Sheehan, Patrick.
• Shortall, Róisín.
• Stagg, Emmet.
• Stanton, David.
• Timmins, Billy.
• Wall, Jack.
• Yates, Ivan.

Tellers: Tá, Deputies S. Brennan and Power; Níl, Deputies Barrett and Stagg.

Question declared carried.