THE DÁIL’S influential Public Accounts Committee (PAC) said yesterday it wanted to initiate a “meaningful” parliamentary investigation into the role the Irish banks played in contributing to the State’s deepest financial crisis since its foundation.
Bernard Allen, the Fine Gael TD who chairs the PAC, said it would convene a special meeting early next month to assess the prospect of the committee holding an inquiry into how Irish banks became so exposed to bad loans.
The announcement came a day after economist Colm McCarthy, who chaired the group that identified over €3 billion in cuts in the public services, expressed the view that a Dirt-like inquiry into the lending activities of the banks would be publicly beneficial.
In 1999 the PAC uncovered significant evasion by financial institutions in relation to deposit interest retention tax (Dirt).
However, Mr Allen said the committee would need to have very strong powers to enable it to conduct a proper investigation, and it would need the support of the Government to do that.
He said that if support from the Coalition was forthcoming the investigation could proceed this autumn.
"We need increased powers and co-operation from the Government. We will seek legal advice on what extra powers will be needed to carry out a meaningful investigation," Mr Allen told The Irish Times.
He accepted there were a number of constraints currently in place following the Supreme Court judgment relating to an Oireachtas committee’s investigation into the shooting of Abbeylara man John Carty in 2000.
Mr Allen said it was important that witnesses be made to come to the inquiry.
He also said that the Carty judgment had placed restrictions on how the committee could report on its findings, especially when making adverse findings against individuals who were not TDs or Senators.
“If the political will is there and if the Government is prepared to introduce legislation if it’s needed, then it can be done very quickly. The investigation can happen later this autumn or early next year,” he said.
The proposal to have an inquiry into the banking sector will require special legislation that would underpin the inquiry in the same way as special legislation was passed in respect of the Dirt inquiry.
However, Mr Allen said the recent inquiry by his committee into the operation of the State employment and training agency Fás demonstrated its efficacy when given sufficient powers.
Mr Allen said the legislation to establish Nama had also given the PAC and the Comptroller and Auditor General a scrutiny role in respect of the operation of the agency.
“It will be an ongoing feature of our workload,” said Mr Allen.
Green Party finance spokesman Dan Boyle also said yesterday that he supported the inquiry, and agreed with Mr McCarthy that the public needed a full explanation of what went wrong with the banking system.
“In the next weeks the Dáil and the Seanad will examine legislation to set up a National Asset Management Agency. This is probably the most significant piece of legislation that this Government or any government in recent decades will have had to pass, and because of that there is genuine public concern – especially as some of the people who got us into this mess have yet to be called to account for their actions,” said Mr Boyle.
Earlier, speaking on Newstalk 106, Mr Boyle said that questions would also have to be asked of the political establishment, including Taoiseach Brian Cowen and former taoiseach Bertie Ahern.