Dirty Bankers

     
People are literally dying because our health service is starved of cash. The Government should invest the AIB windfall wisely on hospital waiting lists.
A profiteering law breaking private sector, an inept regulator, an absence of law enforcement and a powerless government - does this sound familiar? Yes, this week we are enjoying yet another instalment in the ongoing saga of corporate corruption.

One more week and yet another multi-million scandal has been uncovered by the media. At this stage you would think that the Irish public would have got used to the plotline where clever fraudsters evade the bungling Inspector Clouseaus with consummate ease. However the revelations that AIB could owe the Revenue Commissioners over £80 million in unpaid tax has caused genuine surprise.

Inept tax collectors


Not that anyone doubted that the private banking sector was capable of huge fraud; the debacle earlier this year at National Irish where the bank stole money from their own customers showed just how low the banking sector could go.

The AIB scandal is more serious than the National Irish episode because it shows clearly that the profiteering banking sector are capable of a huge systematic deception and fraud. Worse still, the scandal shows either a compliant Revenue Commissioners who aided this deception or an inept one who didn't know that AIB owed them £80 million until they read about it in a Sunday newspaper.
     
AIB's offices in the Financial Services Centre. The banking sector must be brought under public control

So what are AIB actually accused of doing? The allegations are these. AIB are accused of making a secret agreement with the Revenue Commissioners in 1991 where the 26-County tax collectors took only £14 million of an £100 million tax debt.

The other side of the AIB scandal is that branches throughout the state actively participated in setting bogus accounts for their customers. These accounts, which were supposed to be for non residents, are not liable for the DIRT tax which AIB was evading.

Bogus accounts


In 1991 AIB had opened around 53,000 of these bogus accounts. In one small town, Tralee, £187 million was being held in 14,251 non-resident accounts.

AIB were in a sense widening the economic divisions by helping those lucky enough to have disposable income invest it illicitly. This is a bank which like many others overlooks the smaller income earners and won't give them small loans and credit facilities. They will, though, help the higher income earners to actively defraud the state.

The other side to the AIB scandal is the role of the Revenue Commissioners and the Central Bank. The chairperson of the Revenue Commissioners appearing before the Leinster House Public Accounts Committee said this week that ``the Revenue Commissioners have very limited powers'' and did not have ``wide policing powers''.

This leaves us to fall back on the Central Bank as the regulators of the private banking sector. Yet again they have been shown to be completely ineffective. It seems that AIB and the other banks have a clear field when it comes to defrauding the state. It is clearly incapable of monitoring the banking sector.

What is to be done?


In order to properly address this ramifications of this crisis we have to ask what can be done. One answer is to give the regulators more powers. However, this does not guarantee that they would be more effective. If you are depending on the media to act as a whistle blower what does it say about the Central Bank's effectiveness and efficiency?

No, the only viable route is to tackle the banks themselves and the best possible method of achieving this is to bring them back under public control.

We need to decide what role we want the banking sector to play in Irish society. Do we want them to be the institutions that foster and encourage local business, investing in local communities, aiding the development of a people's economy or do we want them to continue with profiteering and exploitation as usual?

Sinn Féin's representative for Dublin South West Seán Crowe has said the outstanding money owed to the state from the banking irregularities should be invested in the health service. He said ``People are literally dying because our health service is starved of cash. The Government should invest the AIB windfall wisely on hospital waiting lists. This would help end the misery of thousands of seriously ill patients''. This at least would be a start.

The real objectives of EU Funding

Selling the benefits of EU membership to the Irish people by successive Dublin Governments has hinged on one core feature - money. They give us more money than we pay them. Therefore it is a good thing.

In 1992 when campaigning for the adoption of the Masstricht Treaty the vast majority of Leinster House parties and particularly the then Fianna Fáil/PD Government highlighted the £6 billion we would be getting from EU structural funds.

The issues of the damaging consequences of economic union, the loss of economic sovereignty and the erosion of our neutrailty were an acceptable price for the £6 billion on offer.

Now the wheel has turned and the next round of EU structural funds are currently being negotiated. In 1992 the whole of Ireland qualified for the maximum amount of EU funding called Objective One status because our average income were less than 75% of the EU average.

The years of economic growth in the Celtic Tiger have meant that the 26 Counties as a whole no longer qualifies for Objective One status. Now cue headless chickens in government who are trying to negotiate new funding regulations that will preserve Objective One status in the West and North West.

Sinn Féin has supported the campaign for the continuation of Objective One status but not without conditions. Much of the infrastructural projects funded under the 1994 to `99 plan favoured the eastern and southern counties throughout Ireland.

The West and North West were overlooked.when the structural funds were allocated, as were many urban and rural areas suffering ecoomic deprivation. The aim of the structural funds was supposed to be to ``increase the social and economic cohesion of the EU through the encouragement of durable economic development in weaker regions''.

This has clearly not happened. If the Dublin Government are really serious about securing the best possible deal from the next round of EU funding they have to move themsleves out the mentality of merely maximising the money available. They have to look at the real benefits and costs of EU membership.

The Dublin Government need to: ensure equality of treatment in the application of the funds; prioritise the areas and communities most affected by the economic underdevelopment in Ireland; maximise the participation of citizens and communities in deciding how the structural fund plan should be applied in their areas; ensure that the funds are being applied in the most efficient and transparent methods possible; take every possible precaution to protect and enhance our environment.

If these basic things are done maybe the next rounds of EU Funds will be worth some of the sacrifices we as a state have to pay to get them.