The Government is in possession and the Minister for Social Protection, Deputy Joan Burton, is sharing time with Deputies Olivia Mitchell and Tom Barry.
Promissory Notes: Motion (Resumed)
The following motion was moved by the Minister for Finance, Deputy Michael Noonan, on Tuesday, 12 February 2012:
That:
Dáil Éireann welcomes the restructuring of the promissory notes provided for the IBRC, based on the outcome of discussions with the European Central Bank;
— recognises the benefit of the restructured arrangement for the State and its citizens, particularly:
— the removal of the promissory notes which will be exchanged for long-term Government bonds, with an average maturity of 34 to 35 years, as opposed to the promissory notes' seven to eight year average maturity;
— the reduction in the State's general Government deficit of approximately €1 billion, 0.6% of GDP, per annum over the coming years, which will bring us €1 billion closer to attaining our 3% deficit target by 2015;
— the reduction in the State's cash borrowing requirement over the next ten years by €20 billion;
— the significant element of the interest payments on the Government bonds that is expected ultimately to be returned to the Exchequer in the form of Central Bank dividends, while these bonds are retained by the Central Bank;
— the substantial improvement in the State's debt position over time;
— the removal of the remnants of the former Anglo Irish Bank and Irish Nationwide Building Society from the Irish financial system;
— the housing of all "wind down assets" in one entity, the National Asset Management Agency, which should lead to greater efficiency in their workout;
— commends the Government on progressing the commitment "to secure a Programme of Support and solution to the banking crisis that is perceived as more affordable by both the Irish public and international markets, thereby restoring confidence, growth, job creation and the State's access to affordable credit from private lenders"; and
— supports the Government's continuing efforts to foster economic growth and job creation which, in tandem with ongoing discussions on the extended remit of the European Stability Mechanism, will further improve the State's debt sustainability.
Debate resumed on amendment No. 4:
To delete all words after “Dáil Éireann” and substitute the following:
"recognises that the replacement of the promissory notes provided to the Irish Bank Resolution Corporation, IBRC, with long-term Government bonds announced by an Taoiseach on Thursday, 7 February 2013 provides important benefits to the State including:
— a reduction in the general Government deficit of approximately €1 billion per annum over the coming years and will bring the State approximately €1 billion closer to attaining the 3% general Government deficit target by 2015; and
— a reduction in the State’s cash borrowing requirement over the next ten years by €20 billion by virtue of paying interest only on Government bonds rather than capital and interest on the promissory notes;
acknowledges the considerable efforts made in recent months by those who negotiated on Ireland’s behalf including the Minister for Finance, the Governor of the Central Bank and officials from the Department of Finance and the National Treasury Management Agency;
calls on the Government to use the €1 billion gain on the general Government deficit to ease the planned budget adjustments and to invest further in job creation measures without compromising the achievement of the 3% deficit target by 2015;
notes that the Government has not sought or received any write-down whatsoever of the legacy debt associated with the rescue of the former Anglo Irish Bank and Irish Nationwide Building Society;
notes that the Euro Area Summit Statement of 29 June 2012 reaffirming the imperative need to ‘break the vicious circle between the banks and the sovereigns’ has not been implemented in this case;
notes that the conversion of the promissory notes to long-term Government bonds means that there will be no further easement of this debt as a result of evolving European policy;
believes that the Central Bank should be permitted to retain the Government bonds for longer than the period agreed which would yield additional savings to the State;
calls on the Government to publish a detailed analysis of the full impact of the deal on Ireland's debt and deficit figures over the full course of the deal, including, for example, sensitivity analysis for varying interest rates on the Government bonds and possible payments to the National Asset Management Agency to cover any shortfall - should one arise - following the sale of IBRC assets by the special liquidator; and
believes that the justice of Ireland's case deserves further relief from the impact of bank-related debt and, in particular, that the Government should be seeking to have the cost of bailing out AIB, Bank of Ireland and Permanent TSB lifted from the shoulders of the State through the European Stability Mechanism."
(Deputy Michael McGrath).
I welcome this motion and the landmark deal that the Government has secured to ease the debt burden we inherited from Fianna Fáil. In March 2010, when the chaotic Fianna Fáil-led Government cooked up the promissory note to recapitalise Anglo and Irish Nationwide, I warned of the consequences. Fianna Fáil still seemed to think at that time that Mr. Fingleton and Mr. Fitzpatrick were some kind of economic whiz kids who had reinvented banking so that it only produced profits and never caused any issues around debt or sustainability. Following the disastrous bank guarantee, Fianna Fáil announced it was immediately pumping €8.3 billion into Anglo by way of a promissory note, with a further €10 billion to come, and a separate €2.6 billion for Irish Nationwide. I remember the gasps in this Chamber when those figures were announced. Fianna Fáil then compounded this dodgy deal by taking a two-year repayment holiday, thereby passing its poison pill on to this Government, in what I suppose was considered a neat piece of political footwork.
At that time, I was clear about what such a toxic arrangement would mean - a €2.1 billion payment a year by taxpayers to cover the costs of crony capitalism. As we all know now, thanks to Fianna Fail's breathtaking incompetence and Anglo's rogue banking, the bill grew even higher. When all was done and dusted, taxpayers were left on the hook for €31 billion in promissory notes - and a €3.1 billion annual payment before a cent was spent on health, education or welfare. Anyone who has ever been involved in running a household budget or a business knows that cashflow is vital. The annual payment of €3.1 billion was a crippling amount of cash for any Government to pony up each year. The fact we do not now need to borrow and pay the interest on that annual cashflow requirement of €3.1 billion is an enormous improvement in Ireland's debt sustainability and is critical to getting us out of our difficulties.
As the Labour Party spokesperson on finance in 2008, I opposed the bank guarantee because I knew it was a reckless gamble through which Fianna Fáil essentially bet the public purse on Mr. Fitzpatrick and Mr. Fingleton and their like. At the time, I warned that the Exchequer, or some specially created public agency, might become an owner of vast amounts of dodgy debts and the property associated with them, which is exactly what happened with NAMA. Once the disastrous promissory note was put in place, I consistently argued that it needed to be renegotiated so that Ireland could repay over a longer term in a way that did not inhibit recovery or debt sustainability.
I have never been an advocate of default. As the former IMF director, Donal Donovan, pointed out last week, the effects of a default would have been catastrophic - fatal to the Government's efforts to re-enter the bond markets and disastrous to our reputation as a stable location for foreign investment and as an open trading economy. We are incredibly dependent on trading to make our living. It is a fiction perpetrated by certain commentators and Opposition Members that a default would make all our problems disappear in a puff of smoke. One should ask the Argentinians about that. More than a decade after Argentina defaulted, hedge fund creditors are still chasing it through the international courts and the country is indefinitely shut out of international financial markets. Recently, the Argentinian President was concerned that if she left the country on the government jet, it would be seized by creditors. Do the same commentators and Members of the Opposition wish to reduce Ireland to such pariah status? These are inconvenient truths that the default vigilantes on the Opposition benches are never prepared to address.
Rather than default, I often cited the example of the Marshall plan and the follow-on 1953 London debt agreement, which allowed Germany repay its legacy debts over a much longer period and rebuild after the war. Such a deal, I argued, would be crucial to Ireland's recovery and would be a demonstration of European solidarity. I am very happy to say that the Government has now secured precisely such a deal, through careful negotiation, persistence and determination. The deal will ensure that Anglo has been wiped off the map and the promissory note torn up. It will ensure that the IBRC-related debt is tucked into a long-term bond which will allow the State to pay over a much longer period at a lower rate of interest. This will mean a cashflow benefit of €20 billion over the next decade and deficit reduction of up to €1 billion per year over the coming years. This is a key milestone on Ireland's road to recovery, significantly enhancing our debt sustainability along the lines I advocated. We will not have to pay the first principal payment until 2038, and the last in 2053, by which time inflation will have ensured that the real value of these payments has lowered significantly.
Members on the opposite side of the House will understand the mathematical facts around the time value of money. In 1973, 40 years ago, Irish GDP was €3.76 billion. Today it stands at €168 billion. In other words, over that 40 year span, we had an average 10% annual increase in our GDP. Therefore, the debt which seems so sizeable now will eventually be dwarfed by economic growth and inflation. This assumes we will have to pay the principal from 2038 onwards. Once the country is sustainable, there will be a strong market for our bonds. Therefore, it is more than likely that if future governments wish at that time, the debt will be rolled over, the normal course of action for many countries.
There is further to go. We must continue to negotiate on the rest of our bank-related debt and must seek solutions that will further improve our debt sustainability, in particular the extension of our bailout loans. As Members know, the Government has work in progress on that.
All of this effort will be in vain if we cannot use the improvements in our debt position to ease the burden on our hard-pressed citizens. The people of this country have stayed the course throughout the financial collapse, the economic upheaval that followed and the austerity budgets that were an unfortunate and inevitable consequence.
There is a limit beyond which additional austerity becomes counterproductive. After five years of a European response centred on austerity, we are close to that point now. The IMF has admitted in its staff reports and other reports that it underestimated the effects of austerity on economies throughout the financial crisis. As someone who has argued for a long time that deficit reduction is sensible but should not be implemented too quickly, I welcome that admission. It is inescapable that Ireland has to get its deficit down. We are spending more than we are taking in and borrowing to plug the gap. This Government is committed to tackling that issue and putting the public finances in order.
The proponents of austerity seem to think deficit reduction can only be done by cutting endlessly. I suggest that the best way to reduce the deficit is to get more people back into work, thereby boosting consumer spending, increasing the State's tax take and reducing the borrowing requirement. That is why, in my capacity as Minister for Social Protection, I have sought to protect the welfare budget and core weekly rates, reform employment supports and significantly increase the number of activation places to help people get back into work, training or education. Data published by the CSO today underline the crucial importance of welfare payments in reducing poverty. They show that in 2011, welfare payments reduced this country's at-risk-of-poverty rate from 51% to 16%, which was the best outcome in the EU.
The welfare budget is not just to protect the most vulnerable people in society. The €20 billion that is spent on welfare acts as a Keynesian automatic stabiliser; it supports the economy by putting money into the hands of consumers who need it. That money goes through their hands and into the tills of businesses, shops, pubs and enterprises throughout the country on a regional and island-wide basis. The role of the welfare system in stabilising economic demand is acknowledged internationally. The US Congressional Budget Office has noted the impact of expenditure on welfare in stabilising European economies. We have to use the proceeds from the promissory note deal to invest in our people and our economy. We need to start that process this year. We have a very good base from which to ensure the Irish economy grows again, get people back to work and invest in the country.
We do not often see exuberant celebration and delight in the halls of Leinster House. We seem to think we are far too sophisticated for that sort of display. Perhaps we regard it as a little naff. I have no hesitation in declaring my unashamed delight about last week's deal. When the Taoiseach read the terms of what had been agreed, it brought a sense of relief to this side of the House. In fairness, I think that was shared on the Fianna Fáil benches. It was almost as if we were able to begin to breathe a little more easily, having been holding our breath since that fateful day in November 2010 when the IMF arrived here. The day we lost our financial independence was the saddest day this country had seen since Independence. We had lost our sovereignty after less than 90 years of independence. Until last week, it did not look as though we were going to get it back any time soon, and certainly not in 2014. Now there is a chance that we will. Perhaps the small and positive signs of recovery that are evident at present will grow into something that puts people back to work and offers our children the prospect of a future at home.
I would like to take my hat off to the Taoiseach, the Minister for Finance, the regulator and the staff of the Central Bank and the Department of Finance for securing this deal. I salute them for the sheer ingenuity of the arcane and complex device that is being used to get rid of the promissory notes, which means we are staying on the right side of what might be regarded as quantitative easing. I applaud them for keeping their heads in recent months when they faced a barrage of constant criticism from those who suggested the Government was doing nothing or, if it was doing something, was doing the wrong thing. I congratulate the Government on the slow but incremental progress it made by engaging in targeted lobbying and persuasion and by building a consensus in Europe around the validity of our case.
Not everybody appreciates these efforts as much as I do. Fintan O'Toole accused the Government in yesterday's The Irish Times of raising "expectations of the end of so-called austerity" and suggested that the deal is generally being oversold. I thought it was rich of him to write that "calling it a 'milestone' is ridiculous hyperbole". I looked up "milestone" in the dictionary to see whether it might mean something other than what I take it to mean. It is defined as something that indicates the distance to a certain point, which is exactly what the Government has been saying in this regard. This deal is an important development on our way to somewhere else.
Other speakers - Deputy Halligan yesterday and Deputy Boyd Barrett this morning - have accused the Government of "back-slapping" and overstating what has been achieved. Every Government spokesman I have heard has played down the immediate impact of the deal on austerity. I would be the first to caution those who are looking for tax reductions or spending increases that there is no new pot of money. I believe they know that. The impact of this deal is that less money will have to be borrowed. It is not the case that more money will be available to be spent as a result of the deal. The Opposition cannot have it both ways. They cannot claim the deal has no merit while looking for the proceeds of the deal, as they see it, to be spent and frittered away.
The Government must decide whether to stick to the original budgetary adjustment so that the deficit target of 3% of GDP can be reached, or ease up on the spending cuts and tax increases that are planned. The correct course is by no means obvious at this stage. One could argue that the quicker we cut the deficit, the quicker we will get back to normal budgeting and normal interest rates and the greater the possibility of a reflationary Government stimulus package. One could equally argue that such an approach runs the risk of having a deflationary effect on an economy that is already flagging. I do not know what the Minister for Finance is thinking. His mind may be made up for him by the growth rates in Europe, which will affect our ability to achieve the 3% GDP target.
Fintan O'Toole is not the only naysayer. The many people who say this was not our debt are right. The problem is that it is now our debt. There is no getting away from that. It was not our debt originally. Railing against it now is like railing against last year's weather. It is just as futile and just as corrosive to national morale. We should never have agreed to take on the liabilities of Anglo Irish Bank, but unfortunately we did. We copperfastened the underwriting of its liabilities when we took the money for the bailout.
As I have run out of time, I will conclude by saying we got the best deal we could in the circumstances. That can be judged from the reaction of the markets and the rating agencies. This deal improves our chances of getting back into the markets and saying goodbye to the troika for once and for all, something for which we all wish.
I am delighted to speak on this motion. I will not go into the minute details of the deal. This is a very good deal for business and for jobs. People are wondering whether this will benefit them. Of course it will. Last Monday, I spoke to a business person in Cork with whom I deal regularly. He said he had been contacted by one of the pillar banks for the first time in almost four years. An official in the bank asked to call out to his business to discuss his finance needs with him, which was absolutely momentous. This is what happens at the cutting edge. The businessman in question said it was fantastic that he could finally stop living in a shell and start expanding his business in a proper fashion. This is what it is about. It did not happen by accident. It happened because confidence is building in our society, regardless of what some people say.
I will set out what has been achieved here. When I was a young nipper 40 years ago, I used to go into my local shop, which was run by a lovely woman who has now passed on to her eternal reward.
In the shop were packets of crisps which, at the time, had a price of 2 pence written on the packet. The price should be written on the packet today also, as this might get rid of some of the price variations, but that is another story. In any case, crisps were 2 pence a packet, whereas today a packet would cost north of 80 cent. Inflation happens whether we like it or not, and growth rates also happen. That 40-year period is almost half the existence of this State, yet that is how far it is being pushed out.
It is a bad day for the Opposition. I am not particularly referring to Fianna Fáil, which recognises the validity of this, but to those who oppose it. It is bad day for Opposition Members in a number of ways because it exposes the very people who oppose everything. I am sure that some day they will look up and oppose the colour of the sky. It shows their lack of credibility and lack of business awareness. This is a great day for business - that is a fact.
I will simplify this even further for those people because I do not believe they understand. There is an Irish phrase, if the House will pardon the pun in these times, "Live horse and you will eat grass". Essentially, we must get through today if we want to have a future. There is no point in sinking the ship today and having no future ahead.
There are some who complain their children will be paying for this yet, at the same time, they say they will not pay their taxes. I suggest that if the children take after the parents, they will not be paying for anything at all. One cannot be a member of society and not pay taxes. Some people just do not want to contribute to society and all they want to do is criticise.
To use the celebrity model, which we have often seen on television, in dealing with financial problems, people are told, first, to cut up the plastic cards and live within their means. This country is €12 billion beyond its means so we must get to that point. Second, they are told to renegotiate their debts and stretch them over a longer period of time. I am surprised some of the Deputies who have criticised this have not even watched Eddie Hobbs on television as they might have learned a lesson. I am trying to make it as simple as I can for them because they cannot grasp the concept.
The rating agencies, the most serious of people, have looked at this and said it is going in the right direction. We secured a banking deal and a CAP budget deal last week. This is an indication of how seriously the Government is being taken in Europe. We are 40 years in Europe and, thanks be to God, our experience is showing now and we are leading the way.
In conclusion, I ask that we look at the people who created this mess. We cannot, in conscience, let the people who created this mess away with it. Now that the financial side is being sorted, I suggest we spend the time to bring those people to justice. What they have done to this country is simply unforgivable.
I wish to share time with Deputy John McGuinness.
Is that agreed? Agreed.
I welcome the opportunity to speak on the motion. In particular, I want to support the amendment put forward by Deputy Michael McGrath and Fianna Fáil, which states that Dáil Éireann:
"recognises that the replacement of the promissory notes provided to the Irish Bank Resolution Corporation, IBRC, with long-term Government bonds announced by An Taoiseach on Thursday, 7 February 2013 provides important benefits to the State including:
— a reduction in the general Government deficit of approximately €1 billion per annum over the coming years...
— calls on the Government to use the €1 billion gain on the general Government deficit to ease the planned budget adjustments and to invest further in job creation measures without compromising the achievement of the 3% deficit target by 2015;
— notes that the Government has not sought or received any write-down whatsoever of the legacy debt associated with the rescue of the former Anglo Irish Bank and Irish Nationwide Building Society;
— calls on the Government to publish a detailed analysis of the full impact of the deal on Ireland's debt and deficit figures over the full course of the deal...
— believes that the justice of Ireland's case deserves further relief from the impact of bank-related debt and, in particular, that the Government should be seeking to have the cost of bailing out AIB, Bank of Ireland and Permanent TSB lifted from the shoulders of the State through the European Stability Mechanism."
A key element of this whole process is the liquidation of IBRC, formerly Anglo Irish Bank and Irish Nationwide. Personally, I believe this is a good, practical, businesslike, common-sense decision as well as being a good legal decision and in the best interests of the Irish taxpayer. I say that because NAMA and IBRC have essentially been in the same space over the past couple of years. They are dealing with various high-worth individuals who are involved in development loans and some property portfolios, and in many cases they are dealing with the same individuals. NAMA and IBRC have separate mandates, however, and they each seek the best return for their own organisation. On occasions, as I have pointed out, the overall interest of the State was not served by their objective to receive funds for their separate organisations, sometimes compromising the debt of the other State organisation.
I believe the decision to liquidate IBRC is long overdue and it is a good decision in its own right, regardless of the bigger issue of the promissory note deal. Although I know the two are inextricably linked, it is the right thing to do. I personally called for this bank to be liquidated years ago, initially when it was Anglo Irish Bank. On 7 November 2012, speaking at the Oireachtas Committee on Finance, Public Expenditure and Reform when we met the gentlemen from NAMA, I specifically said: "I think NAMA and the IBRC are in a similar space from the point of view of the Irish taxpayer and I believe if would be better ... if the two organisations were under the one umbrella and working together rather than, on occasion, working to separate agendas." In the Dáil Chamber on 2 November 2011, I said "the liquidator should be called in". In 2010, while we were in government, I personally called for this, and I know the then Minister, the late Brian Lenihan, considered this as an option when considering nationalising or liquidating the bank. He chose the nationalisation approach because he obviously felt the risk of liquidation, at that stage, would have been too severe. As time has passed, however, and the bank situation has become more clear, I think it right that we have now come to this place.
It is good that there is a consensus on this issue at last and that the right decision has been made. However, it is important that we learn lessons for corporate governance. With regard to what went wrong in Ireland, three names stand out in the public mind - Seán Fitzpatrick, Michael Fingleton and Seán Quinn. While they are separate people, they were three powerful men who had absolute, complete and total control over their organisations. Nobody dared question their authority. When one person has absolute control of a multi-billion euro industry or organisation, the outcome can in some cases be catastrophic, as we saw in regard to the three organisations those people absolutely controlled. That is the lesson. People, including the regulators, should have seen there was a risk in such situations.
The gross value of the loan book of IBRC is €25 billion but there are impairments of 44% already provided for in its accounts, and the value that is now showing in its balance sheet is €14 billion. The big question of the valuation of the loan book has now to be dealt with because, ultimately, it will be sold or transferred to NAMA. Section 14 of the IBRC Bill, "Determination of consideration for bank assets to be acquired by NAMA", states: "For the purposes of the valuation ... loan assets shall be valued using discounted cash flow analysis". While we all understand this, it is not the valuation method that was used by all of the other banks, including Anglo Irish Bank, when they were transferring their earlier loans to NAMA. Instead, the method used was long-term economic value rather than the market value or current value, and this was approved by the EU in order to assist those transfers. In effect, NAMA will end up with some loan assets valued under this discounted cashflow method and others valued under long-term economic value, which could mean a difference of 20%. Will NAMA have a veto over these new values? The Minister must clarify this point.
NAMA will inevitably want the lowest value so the amount it pays will be low, but the lower the value it accepts, the greater the amount local creditors will be left short, while bondholder payments are guaranteed by the Minister and some are even being brought forward from 2014 and 2015. As we speak, this includes all unsecured bondholders, who will be paid - the Minister will ensure that.
However, there was no guarantee for local Irish suppliers of goods and services to IBRC when it went into liquidation last week. The value of the loans has been transferred from IBRC to NAMA. If there is a further write-down when they are revalued, it will have implications for other NAMA loans and the pillar banks. In a nutshell, if it transpires that the figure showing in its balance sheet is not €14 billion but turns out to be €11 billion or €12 billion and there is a write-down by 10% or 20%, it will call into question how assets are valued on the balance sheets of the pillar banks and in NAMA. If we see a loan book of this size in the economy which needed a write-down having to be forensically examined again, one cannot say it has no bearing on every other institution. I worry that the new values will cause knock-on problems. This issue must be looked at.
On page 17 of the most recently published financial statement by IBRC, its interim report for the six months to 30 June 2012, published in August, the directors talk about the risks associated with IBRC and Government policy and restructuring as a possible risk. They also say that "if new governmental policies were to require the Bank to resolve its position over a shorter than expected time frame, projected asset recovery values could be negatively impacted". Clearly, the fact that we are now to telescope the closing down of the bank will have a negative impact. On page 20, it is stated:
As NAMA reserves the right to adjust the consideration paid for assets previously transferred when the due diligence is completed, the final adjustment to transfer values will only be determined when full due diligence in respect of the assets has been completed. These adjustments have the potential to be either positive or negative, depending on the assessment of the underlying loans.
What IBRC is confirming is that if NAMA believes what it paid for the loans already transferred in the past couple of years worth tens of billions of euro has been overstated, it can come back to the original transferring institution to make an adjustment. My question is how this can happen if IBRC no longer exists? NAMA must reassess and revalue everything it has taken from Anglo Irish Bank in the past couple of years, not just what it is taking now. This is because if there is a shortfall when NAMA comes to realise the value of these assets in the year or two ahead, it will not be able to go back to IBRC in the way it can with AIB or Bank of Ireland because IBRC will not exist and it will be left with the shortfall. It is up to NAMA to assess any potential shortfall. I am not saying there is one, but it would be a crazy risk to take without examining the matter and it could have further implications in terms of the actual cost involved.
A few issues arise from the liquidation, one of which is the question of legal actions involving IBRC. I do not know what is going to happen with pending legal actions and legal actions in train, but I want the Minister to look at this issue. We are all aware that the Director of Corporate Enforcement is looking at former directors and the Minister, in reply to a parliamentary question last year, said that as a result of investigations carried out on behalf of the Central Bank, information on Irish Nationwide Building Society had been relayed to the Garda. The Office of the Director of Corporate Enforcement cannot look at Irish Nationwide Building Society because it was not covered under the Companies Act as it was a building society; therefore, the issue must be dealt with by the Garda. I am not saying there will be legal challenges, but I want to ensure the passing of the legislation will not compromise that process. Those watching "Primetime" the other night will have been shocked and I want the Minister to re-examine the matter. When everyone in the country was affected by the 2% pension levy in 2011, approved retirement funds were excluded from it. This specifically includes the pension pot of €27 million for Mr. Michael Fingleton. The Minister specifically allowed that to happen and we discussed the issue. These issues must be revisited because people would have been aghast had they been told on television that Mr. Fingleton's pension pot had been exempted from the pension levy everyone else paid.
We must try to secure a deal with the ESM for the other banks. The IMF-EU-ECB deal was a three-year programme from the end of 2010 to the end of 2013. We are nearing the end of that programme. The troika has told the Fianna Fáil delegation that at this stage it is looking at exit strategies. It is essential, therefore, that no action is taken by the Government which will prevent the orderly exit from the programme at the end of 2013, a date established prior to the Government coming to office.
Deputy Sean Fleming reminded me of the debate that took place around that time on his suggestion regarding Anglo Irish Bank. I was one of those who supported his point of view. There is not one person in the country who would not be happy that Anglo Irish Bank and IBRC have been removed from the banking landscape and that this deal is in place. I respect the work done by the officials, the Minister and the Government to achieve what they have achieved. I was conscious as we went into the final session of this debate that we should be talking about a debt write-down and debt forgiveness. I say this because as we make the deal for the bank and look towards finding ways of supporting the other pillar banks, we must turn and face citizens and ask what are we going to do for them because they are asking us the same question. If we can kick the can down the road for the banks for 40 years, why can we not adopt a similar approach to personal and mortgage debt within the banks for citizens? This would give them the same opportunity that the country is getting. With the kicking in of the increase in inflation, we would see the debt come down to a rate with which we could easily deal and numbers we could easily comprehend. If we do not take a stern hand to the banks, they will continue to penalise those who have mortgages and are in personal debt. The Taoiseach made the case this morning that the banks were dealing with this issue and that the Personal Insolvency Act 2012 was in place, but this is happening too late for them. If we can conclude a deal for the country, as we did with the European Union on IBRC, surely as a Parliament, we can turn around and kick the banks into shape, provide the legislation that will give relief to all those in serious personal and mortgage debt and turn to the banks and insist on they doing business with SMEs?
Deputy Barry mentioned the bank that was looking for business. When I watched television last night I saw the French owner of a business on Moore Street declare that he received no support from the bank in question. The general consensus in the SME sector is that the banks are simply not supporting Irish businesses directly by giving loans. The man to whom I refer is one example who was clear in his position and had proved to the banks that he had a successful model, yet they refused to give him money. Many with Chambers Ireland and other national organisations who represent small firms will tell us that the banks are not lending.
I will turn to the television programme broadcast last night which examined Irish Nationwide Building Society under Mr. Michael Fingleton and on which witnesses spoke about their involvement in the company and the lending practices followed at the time. I find it amazing that in spite of the best efforts of committees of the Houses, we cannot get to the point where all of these witnesses can be brought before them to outline their experiences within the company, their misgivings about it and their explanations for banking practices and loans given at the time. As time passes, we will find that the main players who were central to the banking crisis will move off the stage and not have to account for themselves before a committee of the Houses. If RTE can do it, surely there is a way for the Government to provide the legislation to allow the committees to conduct such inquiries? I have serious misgivings about the Oireachtas (Inquiries, Privileges and Procedures) Bill that will be brought before us shortly. However, as RTE unfolds the story, we should seek out those who are willing to participate at committee level and who were central and on the boards of banks to allow them to come forward and give their side of the story before it is too late and we have nothing left but a bad memory.
Memory lapses can cause loose facts to be placed on record. This is the time to do it and it should happen sooner rather than later. I look forward to seeing the analysis asked for by Deputy Sean Fleming of the deal put before the House in order that we can understand what the plan is for the next two to ten years.
Debate adjourned.
Sitting suspended at 1.30 p.m. and resumed at 2.30 p.m.