Fianna Fáil TD for Cork North Central Billy Kelleher has called on Finance Minister Michael Noonan to clarify his support for the Governor of the Central Bank following his comments on the bank guarantee last week.

 

Speaking in Dáil Eireann today (6 April) on bank reorganisation Deputy Kelleher said, “Last week Minister Noonan announced the Government was providing a further €24 billion to recapitalise the Irish banks. In very emotive language he compared the decision of Fianna Fáil to protect people’s deposits and shore up the domestic banking system to one of the bloodiest and most tragic periods in Irish history (Dáil Eireann, 31 March 2011).

 

“The reality is that without the bank guarantee Irish banks would have collapsed overnight bringing our economy with it. Banks would have run out of money and people would have been unable to access their salaries and savings. This was confirmed by Central Bank Governor Patrick Honahan who stated in his report on the subject that “Closure of all, or a large part, of the banking system would have entailed a catastrophic immediate and sustained economy-wide disruption involving very significant, albeit extremely difficult to quantify, social costs, reflecting in particular the fundamental function of the payments system in a modern economy. These costs would have been broad-based in terms of income, employment and destruction of the value of economic assets and would have been on top of the recessionary downturn which has actually occurred.”

 

“If Minister Noonan believes the introduction of the bank guarantee was a catastrophic error how can he have faith in Patrick Honahan to head up the Central Bank at this critical time? Fine Gael’s and Labour’s election rhetoric has done enough damage to Ireland’s reputation. It is now time for Minister Noonan to leave this nonsense behind, confirm that he has faith in Governor Honohan and his report and concentrate on taking forward the work that has been going on since this threat to Ireland’s economy first emerged.”