I have been asking the Taoiseach about his knowledge of various malpractices and cronyism in the banking system that led to the problems currently being experienced by our banking sector and economy. In response, he has been telling me he did not hear of or know about any of these practices when he was Minister for Finance. As a result of parliamentary questions tabled by Deputy Joan Burton and freedom of information material obtained by The Irish Times and published in an article on Monday, we have some idea of the state of the Taoiseach’s thinking on these matters when he was Minister for Finance. In 2007, he set up an advisory forum on financial regulation and legislation. The forum was to draft the heads of a Bill to modernise financial regulation. It was quite active and met seven times in 2007 and 2008.

There are two points of interest in respect of the forum. The first is that the Taoiseach brought in people from the banking and financial institutions to become part of the forum to draft the legislation. Second, he gave them a brief to prepare what was called "cross-sectoral principles-led regulation of the financial sector", which is the official way of expressing light-touch regulation. As it turned out, the Government changed its mind on the kind of legislation in question and the means of preparing it because the forum was wound up quietly in 2009 and the legislation it was preparing has disappeared.

Does the Taoiseach now accept, given all we now know about what was going on in the financial institutions and about their malpractice, that he made a mistake in bringing in the bankers to write their own legislation? Does he accept he made a mistake in giving them a brief to prepare light-touch regulation given what we now know about the consequences of light-touch regulation in the banking and financial services sector?

During the period 2007-09, there was a sea-change in regard to the view of the regulatory system and its adequacy. For that reason, whatever work was ongoing had to take account of the new circumstances after autumn 2008.

On the membership of any advisory group, I am sure the members in question were recommended within the Department. There has been a very close working relationship between the financial services sector generally and the Department in terms of determining how to develop the sector since the time the IFSC was set up. The sector has been providing much employment and revenue for the State down through the years.

With regard to the question on the regulatory system, we have received from the new Financial Regulator a very clear statement on the sort of regulatory regime he believes is required in the circumstances in which we now find ourselves. The desired changes are being mirrored by much change in other regulatory systems across Europe and globally. That is because of the inadequacy of the former regulatory system, which was clearly not sufficient to address the systemic risk that eventually emerged.

The Taoiseach would have the House believe that he had nothing to do with the past.

He was the Minister.

He is the past, and certainly so as far as this is concerned because he was the Minister for Finance. He brought in bankers to draft legislation on banking, to write their own rules. This is what that committee was about. He gave them a brief. He now says that light touch regulation was something in the past, but he gave them a brief to prepare light touch regulation. The problem is that the Taoiseach says he saw and heard nothing, and he will admit nothing. He has learned nothing and changed nothing.

In another story we heard about in the past couple of days, which was highlighted on RTE's "News at One" on Monday, Irish Nationwide hired forensic accountants to unearth and pursue the malpractices that were occurring in the building society. The forensic accountants hired were from the very firm that acted as auditors to Anglo Irish Bank, the people who could not see the loans that Seán FitzPatrick was transferring between Anglo Irish Bank and Irish Nationwide. Will the Taoiseach say what will happen when they come to forensically examine the loans that were transferred by Seán FitzPatrick from Anglo Irish Bank to Irish Nationwide and the role the auditors played in that process? There is a clear conflict of interest.

Was the appointment of these people approved? The difficulty is that, because of the Taoiseach's approach where he heard and saw nothing and has not learned anything, nothing has changed and we are back to the "same old same old" where the people on the inside track and in the golden circle are still being reappointed to examine themselves.

I do not accept that in any sense whatsoever. I do not accept the assertions being made by the Deputy. On the question of the involvement of the financial sector in the preparation of legislation, yesterday the Financial Regulator, Mr. Elderfield, and the Governor of the Central Bank, Professor Honohan, produced a consultation paper on various regulatory changes they now envisage in respect of corporate governance matters. They are putting that out for consultation so that they may hear the views of people in the industry. This does not mean that they are beholden to the industry, but rather that they are listening to the industry to see whether there are practical issues to be considered — to ensure that the best possible practice is applied and that it will be effective and will work. That is not regarded as something that should not be done, yet the Deputy suggests that the same process in the past was somewhat nefarious. I do not see the consistency in that approach.

That is the answer to that particular point.

No, it is not. That is not the answer.

There is no reply I could give that would satisfy Deputy Burton on anything. That has been the experience of everyone.

Given the Taoiseach's performance——

I am sure there may even be a few people in her own party that have the same feeling from time to time. However, in relation to——

The Taoiseach was always like that. It is a pity he never learned a bit——

An Taoiseach, without interruption, please.

In relation to the appointment of the firm referred to by Irish Nationwide, that decision was taken by the building society's operational management which it obviously stands over. I believe we should wait and see what work they do rather than deciding that they are not capable of doing it.

My question was about whether it was approved.