DEPARTMENT OF Finance secretary general Kevin Cardiff defended his actions in relation to the State banking guarantee as MEPs questioned his suitability for Ireland’s seat in the European Court of Auditors.
An hour-long hearing of the budgetary control committee culminated in MEPs voting in a secret ballot against Mr Cardiff’s nomination by a margin of 12 to 11.
The committee’s recommendation goes before the plenary hearing of the full European Parliament next month. Although the parliament’s opinion is not binding, Mr Cardiff has said in response to a questionnaire to the committee that he would withdraw his candidacy if its opinion was not favourable.
Both the bank guarantee and the recent discovery that the department misstated the national debt by some €3.6 billion featured heavily during Mr Cardiff’s hearing before the committee.
He said immediately after his appearance before the committee that he would be “disappointed” if the vote was negative and “delighted” if it was positive.
Without specifying any particular error, Mr Cardiff suggested to the committee that he may have made “enormous mistakes” in his work and indicated that the financial crisis has created a very stressful atmosphere in the department.
Questioned about his professional record, he said the previous government promoted him to lead the department last year and added that the current Coalition would not have nominated him to the Luxembourg-based court if it did not have confidence in him.
“Certainly I can say the people who have had the opportunity to assess me have generally assessed me positively,” he said.
“That’s not to say I haven’t made enormous mistakes. In the middle of a crisis you make very big mistakes and you make very big gains sometimes.”
Asked by Labour MEP Nessa Childers why he had used the expression “doddle” in relation to the post in the court of auditors, Mr Cardiff said that was not what he meant.
“What the newspapers don’t say is that what I said was by comparison to the four years of sheer battle – the nights in which you woke up wondering if you’d made a mistake that would cost a billion or gain a billion that day – by comparison to that I felt that almost any job would be easier,” he said.
Questioned by UK Independence Party MEP Derek Clark, Mr Cardiff rejected outright the contention that his work in charge of banking policy at the time of the guarantee drove the State to bankruptcy.
“I’ve explained that I’m not entitled to say exactly how I advised the government but I’ve explained that I gave the government in my job, from my position, a range of options,” he said.
“Frankly, I don’t accept that I therefore led the Irish people to bankruptcy, I certainly didn’t and I was far from being the only person who was giving advice on that evening.” The guarantee was introduced at a time of great pressure, he added.
“We were at a point where there was at least a danger where our citizens would go to their banks and their workplaces the next week and not be able to access their cash.
“So I think we at least need to reflect on the possibility that the decisions made created some time and some space for further work and also protected our citizens, and indeed citizens of other parts of Europe, from the contagion effects that would have happened from an immediate catastrophe.” Asked what lessons he had learned from the financial turmoil, Mr Cardiff said there was a case to act more quickly in the face of crisis.
“If I’ve made mistakes and I’ve admitted to several, I would say that one of the problems is that you don’t grasp everything quickly enough.”
He declined to apportion direct blame for the misstatement of the national debt, saying the matter was under investigation and could have implications for the reputation and careers of certain individuals.
“It could well be that given the strains we were working under, that an individual made a mistake under considerable strain for example or under resource constraints or that kind of thing,” he said.
He said he took two pay cuts to ensure he was never paid more than the taoiseach of the day. “It’s happened on two occasions that taoisigh have reduced their pay and on each of those occasions I’ve reduced mine so I’ve never been paid more than the taoiseach.”
