“Economic meltdown not some coincidence; decisions made by those entrusted to secure our futures” – Keane on Banking Inquiry

“Economic meltdown did not happen because of some coincidence. It happened because of decisions made by those entrusted to safe-guard our way of life and to secure our futures” – Cáit Keane on the Banking Inquiry

The following is Senator Keane’s statement on the release of the Banking Inquiry report,  as part of a debate in Seanad Éireann on January 27th, 2016.

I will be as quick as I can, but it is worth saying. I congratulate the people who have done the work for us. Their names have been mentioned, but as Senator Craughwell said, they gave up a great deal of time when other people were out in their constituencies. Senators Michael D’Arcy, Susan O’Keeffe and Marc MacSharry are all going for re-election and Senator Barrett is going for a different type of re-election. I wish them all the best of luck and maybe people will recognise the good work they have done on their report.

I know it is not perfect and everybody is looking for people to blame, but one looks at the Central Bank, Department of Finance and the regulators, in particular. I read one quote in The Sunday Independent, which was that the regulators were worse than “a neutered bullock in a field of heifers”. That is one lesson that has been learned from this. We set up a planning regulator today and one of the things I said was that regulators have to take their powers seriously, as seriously as the members of this committee took their powers. They had their hands tied behind their backs. The banking inquiry was established to try to give people insight into how this sorry mess came about and to try to stop it from happening again. Hopefully it has done some of that.  As Senator O’Keeffe said, it is not a full report as they had their hands tied behind their backs with the decision of the Supreme Court. They were not given full access and could not ask the questions that they wanted to ask due to legal constraints and everything else. They had to fight sometimes for relevant information and were stopped from asking the relevant questions. The Taoiseach has said this might have to be revisited by way of a referendum and I would say that if it has to be, so be it.

  Following the banking inquiry in Britain, the committee met a year after the publication of the report to highlight the progress of the recommendations. There are some good recommendations in the Irish report and I would recommend that our banking inquiry committee be recalled to do just that in a year’s time.

  I think Senator White spoke about the individual banks’ culpability. The inquiry committee did not have in front of it a report on individual banks and where they failed or why they failed. They said there was a systems failure in the banking system, which was not good enough. Individual banks should have been hauled over the coals to find out the individual failings.

  The ECB, as has been found in the report, behaved improperly, demanding payments when it should not have. There are differences between what happened when the ECB came in in 2008 and 2010. It was in 2010 that Brian Lenihan was hauled over the coals and we saw what happened there. Before that, in 2008, at the outbreak of the crisis, there was no evidence that the decision at that time was forced on the Irish authorities. It changed in 2010 when burden sharing was looked at. I think it is a question of the amount of the burden sharing that is outstanding for the ECB. I know people have said the Government should take the ECB to court but if we were going down that road, we would have to look at what we might gain from it.

  The report was published in the same week as the Law Reform Commission sought submissions on “whether the supervisory and enforcement powers of the State’s main financial and economic regulators are adequate” and “whether there are gaps in the criminal law that do not deal sufficiently with serious wrongdoing by corporate bodies, in particular regarding current fraud legislation and the general rules for attributing criminal liability to corporate bodies.” All the members of the committee will be well versed in that, and I think the answer is a big “No”.

  I do not have time to say more of what I would like to say. Again, I compliment those who are here and those from the Opposition who facilitated the Senators’ absence from this Chamber during the inquiry. Senator Jim Walsh, as Senator D’Arcy said, was one of them.