Ministers divided over how to run banking inquiry

Government believes parliamentary investigation can be carried out for €5 million, significantly less than any recent tribunal

Minister for Public Expenditure Brendan Howlin has circulated a memo to the Cabinet arguing that the inquiry should be carried out by an ad hoc committee of TDs and Senators. Photograph: Dara Mac Dónaill

Minister for Public Expenditure Brendan Howlin has circulated a memo to the Cabinet arguing that the inquiry should be carried out by an ad hoc committee of TDs and Senators. Photograph: Dara Mac Dónaill

Fri, Aug 9, 2013, 07:55

 


Divisions have surfaced in the Cabinet over the Government’s approach to the looming banking inquiry. The split centres on the composition of the inquiry team.

It comes amid forecasts in Government circles that the parliamentary investigation can be carried out for €3 million to €5 million, significantly less than any recent tribunal. For example, the final cost of the planning tribunal is likely to be about €247 million.

Witnesses to the banking inquiry will have the right to apply for legal costs to the Oireachtas, but the system will be very restrictive. Coalition sources believe costs will be granted only in extremis as the inquiry will not have the power to make findings of fact in relation to any individual.

As preparations gather pace to initiate the investigation in the autumn, it has now emerged that Ministers have been unable to achieve consensus as to who exactly should conduct it.

Minister for Public Expenditure Brendan Howlin has circulated a memo to the Cabinet arguing that the inquiry should be carried out by an ad hoc committee of TDs and Senators, set up under new laws with a specific mandate to explore the causes of the banking debacle.

However, a number of his ministerial colleagues believe the task should go to the Oireachtas Joint Committee on Finance, Public Expenditure and Reform.


Busy agenda
Government sources said there was no divide down party lines in the Coalition on this question, adding that some Ministers in both Fine Gael and Labour had similar views on the inquiry team.

Although the Howlin memo is said to make the point that the finance committee already has a busy agenda of work, other Ministers believe the banking collapse and the €64 billion State bailout fall directly within the committee’s remit.

Certain Coalition figures are also said to be comfortable with the fact the finance committee is chaired by a Government TD, Ciarán Lynch of Labour.


PAC role
Many in the Government are not in favour of the inquiry going to the Public Accounts Committee, which made an early play to take charge of the investigation. The PAC is chaired by Fianna Fáil TD John McGuinness, who was a junior minister in the last government.

Under legislation enacted last month, it falls in the first instance to the Dáil and Seanad to convene the inquiry. However, the Coalition’s position is crucial because its large majority in parliament gives it the power to set the agenda.

The Cabinet will return to the question when it gathers next month after the summer holiday. The exact terms of reference for the investigation and the sequencing of its work also remain to be decided.

While the objective remains for the inquiry to be a “creature of the Oireachtas”, it falls to the Government to set the process in train.

Mr Howlin laid a draft order before the Dáil and Seanad on July 31st to commence the inquiry Bill. Both houses are expected to pass resolutions approving the commencement order by September 25th, soon after their return from the summer recess.

While they will then have 50 days to settle rules and standing orders for the receipt of any request from any Oireachtas committee to carry out the inquiry, the process is expected to move very quickly.

Such proposals would be adjudicated by the committees on procedures and privileges on which the Government has an in-built majority.

There is some expectation one of the first steps of the inquiry will be to appoint an eminent legal or financial expert to direct a scoping exercise in relation to its work.

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