The completion of the public hearings of the banking inquiry reflects the end of a substantial body of work. The initial hearings in the context phase of the inquiry were very much a mixed bag, and by necessity did not break much new ground. The later hearings in the investigative phase were more fruitful. The final report is due early next year. The committee may not have made any major discoveries, but much of the evidence was interesting, some of it was controversial and there is plenty of scope to draw conclusions for the future.
The breadth of work that was taken on by the inquiry was large – perhaps too large, in hindsight. Its format also did not always lead to a logical flow of questioning, with each Oireachtas member being given a specified time period. In some cases the amount of ground to be covered in one hearing also meant many key developments could only be touched on. In probing the actions of individual banks, for example, the senior executives were questioned, but a much wider process would have been needed to get a full account of what happened in each individual institution.
Nonetheless, the appearance of the bankers did serve some purpose in terms of public accountability and the committee was also able to probe in some detail the official response as the crisis built and after it broke. It is here that some of its recommendations might usefully focus , in looking at areas like independent and effective financial regulation and at the expertise in the wider public service and how it is deployed.
If the crisis taught us anything it is that having the right people in senior positions is vital, as are clear lines of accountability.
There are also important lessons for the banks themselves and for their own corporate governance and reward structures. Again recent experience suggests they have not all been learned.
Another lesson came as we headed for the bailout, and has been reinforced by recent events in Greece. It is that help in terms of a financial crisis comes with a high price and that a position of weakness leaves a country with little bargaining power. We must complete the correction of our public finances as quickly as possible and ensure that the promise not to return to the old boom and bust cycle of the past is adhered to. New EU budget rules will help, but taking responsibility domestically is also vital.
Finally, the committee might also turn its attention to one other matter. What changes are needed for other such inquiries to work more effectively in future? The banking inquiry can reach useful conclusions, but its work and its report were both heavily constrained by legal issues and some of the rules – for example the terms on which the Central Bank could co-operate – verged on the ridiculous. Part of the banking inquiry’s final work might be to advise on a better way for the future.