Recall Dáil For Bank Debate, Says FG

Fine Gael have urged the Government to recall the Dáil from its break to allow an emergency debate on the bank guarantee.

The party's Finance Spokesman Kieran O’Donnell has this morning called for the Oireachtas to cut short its break in order to discuss the banking guarantee, which is set to expire on the same day that the Dáil resumes.

Deputy O’Donnell also asked Finance Minister Brian Lenihan to urgently brief the Oireachtas Finance Committee on the Government’s banking strategy. He has written to Committee Chairman Michael Ahern asking him to request the Minister to discuss the banking strategy in the immediate future.

“The bank guarantee scheme is set to expire on 29th September, the same day that the Dáil resumes. We are in the middle of the worst economic and banking crisis ever experienced by Ireland, yet the Dáil is taking the longest recess since 2003. Clearly the Government refuses to face up to the problems it has created. But the bank guarantee should not be extended until the Dáil has had a full debate on this matter.

Mr O'Donnell said he is concerned that the bill for bailing out Anglo Irish and Irish Nationwide is creeping ever higher.

This morning, it emerged that the Bank of Ireland is readying a bond issue worth between €500 million and €1 billion after Tuesday’s successful bond auction by the Government which raised €1.5 billion.

The State's other banks, including the embattle Anglo Irish Bank, which are currently still under Government guarantee could exploit their lowered risk status and follow suit, selling up their bonds in an effort to raise money.

TD O'Donnell said the Government’s blanket guarantee included the subordinated debt holders in Anglo Irish Bank and that Fine Gael believed it was high time these debt holders started sharing some of the cost of cleaning up Anglo Irish.

"But any automatic extension of the guarantee for all institutions will see taxpayers, yet again, left to carry the entire burden by themselves," the Fine Gael spokesman said.

He added: “It is becoming clear that as the cost of bailing out the banks continues to rise, this is having a profoundly negative effect on the credit rating of Irish sovereign debt with international investors. This was demonstrated by the alarming increase in interest rates on Irish Government bonds in recent weeks.

“For this very reason, Minister Lenihan should come before the Oireachtas Finance Committee at the earliest opportunity to address the numerous concerns over the Government’s banking strategy.”

(DW/KMcA)