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Banking inquiry expert named
Read more about: Economy, NAMA 
In a move that suggests a news dump (Friday afternoon, anyone with an eye on news waiting for events in Stormont), the Minister for Finance has named the expert who will write one of the pre-reports into the banking system inquiry. He is Klaus Regling and his track record seems to feature the kind of experience one would want for a job like this — long stints at IMF, German Ministry of Finance, and European Commission before his current consulting gig (the German angle should make for some interesting questions). If there’s any reason for concern, it might simply be that someone from inside the mainstream bureaucratic apparatus for so long would be inclined to pull punches, but there’s no way of knowing that and as the UK Iraq War inquiry is showing, it’s precisely such people with a procedural focus who can help illuminate how decisions were actually made. The bigger problem is that Herr Regling doesn’t think he can do the inquiry on his own, at least within the agreed time frame, and has asked for a 2nd expert assistant, who has yet to be named. It looks like this inquiry will still be running in 2011. Could that be the plan?
The prompt appointment of this expert analyst is to be welcomed. I didnt expect this expert to be found and named so quickly.Full credit to the government for this.
His track record does feature the kind of experience one would want for a job like this, as you say. His IMF background brings the requisite big picture economic rigour.The IMF have hardly been cheerleaders for Fianna Fail;their may 09 report was scathing about the imbalance and overheating presided over by Cowen and Ahern. Likewise the German Ministry of Finance could hardly be more culturally different in their approach to regulatory matters and corporate governance. A candidate with Herr Regling’s background can never be labelled an apologist for the Galway tent. Therefore his appointment does signal an intent to support good investigation, in my view.
Why would Herr regling want another expert assistant to help him? My guess is that he had a quick look at a few things before he agreed to the job. After realising the extent of the tangled web he faced, Quelle Bordelle indeed as they might say in the commission, he knew a trip to dodge city would require a good Tonto to ride shotgun.
And yes it will still be running in 2011. Not necessarily Herr Regling’s bit, but the next stage or other will be running its course. But at least you know what you will be writing about for the next year or so and we know what we will be reading.
Des,
With the appointment of Mr. Regling, it seems that the timetable for the banks’ inquiry is on course and that the scoping exercise – the Honohan and Regling reports – may well be completed by June, as promised by the Minsiter for Finance. Like you, I don’t see anything sinister in Mr. Regling requesting a local assistant – he may know the Irish banking system fairly well from his Commission days, but having a local guide to steer him through the minefield appears wise.
One point that hasn’t been highlighted much is the role proposed for the Oireacthas at the end of this vital first stage of the inquiry. The intention appears to be that an Oireachtas Committee will then consider the expert reports and assist in devising the terms of reference for the second phase, the Commission of Inquiry. The Minister for Finance emphasised the importance of Oireachtas involvement during the Dail debate:
“At the conclusion of the scoping exercise — I accept this was not made clear to the House — it is essential that an Oireachtas committee examines the documents prepared by those doing the scoping exercise, and we are open to Whips’ discussions on this issue….I would see an Oireachtas committee having a vital function in assisting in the formulation of appropriate terms of reference and with regard to where the inquiry goes at the conclusion of the scoping exercise.”
Presumably, he will keep his word. He probably wouldn’t be allowed to get away with it, not least by his partners in government, if he tried to do otherwise.
It’s not clear if the Commission will conduct all its business in private, but that would seem the most likely option if it is to have any chance of completing its investigation by the end of the year. If it took evidence in public sessions, it’s obvious there would be a practical difficulty in completing its work within a tight timescale of six months. I’m inclined to agree with P that this second stage of the process could run into 2011. A 12 month period for the Commission’s investigation might have been more realistic, given the likely complexity and range of issues, but you can imagine the hue and cry that would have ensued if the Minister had made such a proposal now! Who knows, the duration of the Commission’s inquiry may be considered by the Oireacthas Committee in making its recommendations on terms of reference?
No reasonable person, other than idiotic politicians who are only interested in turning the exercise into a political football, could object to the initial scoping stage. After all, even the overly-celebrated DIRT Oireachtas inquiry was scoped in advance by a C&AG report. Having a Commission take up the second stage, rather than an Oireachtas Committee or a Public Inquiry, also appears the most sensible option. Nobody in the Dail, or the media, could disagree with Brian Lenihan’s statement: “We all know that if we establish a tribunal of inquiry under the 1920 Act, we might as well sign a cheque for several hundred million euro immediately on the floor of this House.”
Peronally, I don’t go along with the argument that this inquiry will avoid a repetition of another banking crisis sometime in the future. It’s in the nature of the money beast to come to a sticky end at periodic intervals. Certainly, the DIRT Inquiry didn’t produce anything that could have prevented the collapse of our banking system a few years down the road! But I believe that the inquiry is hugely important for all of us, given the scale of the disaster and the burden it will impose on every citizen of this country for years to come. We need to know the clear unvarnished facts of how it happened and why. After the Commission has reported, an Oireacthas Committee will be well positioned to invite a range of witnesses to appear before it.
I also think some of the political rhetoric – whilst understandable – has been unfortunate and has more made the case for a Commission of Inquiry in preference to a direct Oireachtas Committee investigation at this stage, even if the latter was possible without becoming mired in legal wrangles. For a man who is courteous to his political opponents almost to a fault, Brian Lenihan was unusually direct in his rebuke to Joan Burton, Labour’s Finance spokesperson:
“I say to Deputy Burton that I do not know what will be the reaction of various people in the context of the toxic triangle she believes existed between my party, the banking industry and the construction industry, for example. I do not know how they will scope that element into their work. Her comments in this House in that regard, which have been consistent for a long period, show how totally unfit she is to make judgments on this matter as part of an Oireachtas committee because it is clear that she has arrived at a pre-judgment on the very issues she invites the House to consider as part of a committee determination.”
Not that his admonition will have any effect, so long as the bankers/developers/ FF toxic triangle conspiracy theory continues to stir the pot with the public.