Financial regulation in the Republic a joke, says Ross

SEANAD REPORT:INDEPENDENT SENATOR Shane Ross told the Seanad yesterday that financial regulation in the State was a joke, and the regulator was ultimately responsible for that.

He said what the chairman of Anglo Irish Bank, Seán FitzPatrick, had been doing had gone on for eight years.

“Senator Joe O’Toole had touched on it when he had asked what the auditors, Ernst and Young, had been doing. Had they not issued a warning, and if they had, had it been ignored?

“It is not just the auditors who are involved in this; it is the loan committees, the audit committees, the board and everybody else.”

He said credit was due to the Minister for Finance because the chairman and some other people from Anglo Irish Bank had met him and the issue had arisen then.

“If that had not happened we would not have known about this at all and it would probably go on for many more years.”

Minister of State for Finance Seán Haughey said a review of the matter was being carried out by the board of the bank which now included Alan Dukes and Frank Daly as public interest directors.

The secretary general of the department had been advised last Wednesday evening that the representatives of the board wished to meet on Thursday morning to advise the department of the matter. “We had also been aware that the regulator was in recent days conducting a review of related matters.”

In the debate on the Finance Bill, Paul Coghlan (FG) said he agreed that there would have to be a pay freeze throughout the economy which would have to last for a few years.

Dan Boyle (GP), deputy Government leader in the House, said the resignation of the chairman of one of the banks represented the start of the process of restoring public confidence in the banking sector.

“I do not know of anyone in public life who is prepared to support a State programme of recapitalisation of the banks in the absence of strict conditions applying to those who have shown they are incapable of inspiring public confidence.”

Jim Walsh (FF) said that rather than freezing wages and salaries in the public service, they should claw back the 10 per cent wage increases awarded under benchmarking. “We need to look at numbers in the same way as the private sector. I suggest that a 15 per cent reduction in staff levels (in the public service) would be appropriate, we may have to do this over a couple of years. We should aim to reduce our salary bill by approximately €4 billion. We should try to save a further €4 billion by eliminating wasteful and unnecessary expenditure that does not . . . add anything to the economy.”

David Norris (Ind) said attempts had been made by senior members of the Government to intimidate him over his raising of questions about the manner in which the chief executive officer of the Equality Authority had been “driven out of office”.

Mr Norris said it had been indicated to him that he would be politically punished if he attempted to continue to raise these matters.

“If that ever happens again, I will name the Minister who did it, and I will not stop in this House. I will do the same outside and I will let anybody who dares to intimidate me or to interfere with the democratic process, take his or her chance against me in the courts.”