Cabinet ignored Dept of Finance Warnings

P. Breathnach

Bullseye1 wrote: »

Is this information available to the opposition? If not why? Surely all Dail members should be entitled to this information.

A lot depends on what you mean by "this information".

Communication between a Minister and Civil Servants advising him or her are regarded as privileged. Members of the Oireachtas do not have any general right to question Civil Servants, but on some matters the Minister might assent to civil Servants briefing TDs or Senators.

Dáil committees can question Civil Servants, but I think the range of matters that they can cover is limited to what the Minister allows (I'm not sure on this point).

A small number of senior Civil Servants (Secretaries General and a handful of others) have a statutory function as Accounting Officers. In that capacity they are subject to scrutiny by the Comptroller and Auditor General. By extension, they are made answerable to the Public Accounts Committee in relation to the management of exchequer funds.

It is possible to make a case for allowing greater parliamentary scrutiny of the Civil Service, but allowing unrestricted access would cause many difficulties.

Laminations

P. Breathnach wrote: »

It is possible to make a case for allowing greater parliamentary scrutiny of the Civil Service, but allowing unrestricted access would cause many difficulties.

So you do accept that the status quo is not good enough? No one expects full unrestricted access to all decisions but why not have an addendum to a bill that comes before the Dail with ADA - against departmental advice- so at least this can be debated and explained, before it is too late.

Rubik.

It kind of blows a big hole in Brian Cowen's, much used, defense that his decisions as Minister for finance were always based on the best available advice. He never names who gave the advice, or what that advice was, but the implication is he trying create is - it is not his fault that this advice prove to be incorrect. We now know he was ignoring warnings given by officials in his own department. Not only ignoring, but actually doing precisely what they were warning against in each of his budgets.

View

Could the civil servants involved not have brought their concerns to the attention of an appropriate committee of the Oireachtas?

After all, in theory the government is answerable to the Oireachtas therefore by not bringing this information to the attention of the Oireachtas, the civil service were in effect suppressing information which probably should (if not actually could) be brought to the attention of the Oireachtas.

I would imagine suggesting to some TDs that they should ask questions in specific areas would have allowed the civil servants concerned to then do a "I wasn't going to tell you but now that you asked, ..." routine.

hinault

galwayrush wrote: »

If only someone had told Bertie...

"If only someone told me about the banks..........."

"If only someone from the DoF told me..............."

I'm told that the din in the Galway Tent made it very hard to hear what being said.:rolleyes:
Allegedly.

P. Breathnach

Laminations wrote: »

So you do accept that the status quo is not good enough?

Nothing is perfect. Just about any system involving people can be improved.

No one expects full unrestricted access to all decisions but why not have an addendum to a bill that comes before the Dail with ADA - against departmental advice- so at least this can be debated and explained, before it is too late.

I'm not sure that something as simple as that would work. How great would the difference of opinion between the Minister and the Department need to be to merit the warning tag?

One of the things I would like to see improved is the functioning of the Oireachtas, both the Dáil and the Seanad. I would prefer that TDs and Senators acted as a constructive opposition rather than hope that the Civil Service would do their job for them.

Perhaps a protocol might be found to enable a TD or Senator to ask a Minister if a particular measure had the approval of the Department team and if the Minister gave a misleading reply, then there might be an onus placed on the Department to set the record straight. But I am not sure if that is workable.

Is anything workable? My understanding is that Charlie McCreevy introduced the SSIA scheme against the advice of the DoF. How might things have played out if he had told the Dáil that this was the situation? In my opinion, not one bit differently, because he made no secret of his disregard of Civil Service advice, and his party went happily along the road with him.

CDfm

Tora Bora wrote: »

The buckos, in the DOF, are past masters at leaking info which suits their purposes and their political masters purposes.
Why on earth didn't they leak the warnings they were giving to their economically illiterate political masters:(

Because the report is absolute tosh IMHO look at the words informal used here -

3.4.1 The Department’s economic and fiscal forecast is critical to the budgetary process.
It helps to guide choices on economic and fiscal policy. The Panel’s terms of reference
specifically directed us to review the Department’s record on economic and fiscal
forecasting. The Department works closely, but informally, with colleagues in the Central
Bank, ESRI and Revenue Commissioners to prepare its economic and fiscal forecasts. All
those who discussed forecasting with the Panel judged the Department’s work to be as good
as any other institution making forecasts of the Irish economy. However, the recent past
also demonstrates that it is extremely difficult to project “turning points” particularly in a
rapidly growing economy.

FFS - the regulation of Banks broke down !!!!!!!!!

3.3.7 As the representative of the Public Service employers, the Department of Finance
had an important input to the Partnership Process, and consistently warned of growing
threats to competitiveness. But it did not drive the process, and was reluctant to oppose
packages that included outcomes that retained labour peace for the economy as a whole.

How could the DoF be impartial here ???? Balls said the Queen if I had them I'd be king .

3.10.3 Every party that worked with the Department over this period commented positively
on the quality of effort and professionalism displayed during this period of need. At the
same time, the extraordinary pace of activity has exposed some major shortcomings in the
Department’s capacity. When the banking crisis broke, the Department had neither the time
nor the resources to conduct in-depth investigation of issues. This reflected shortages of
skills in the requisite disciplines and inadequate knowledge of underlying developments in
the sector.

Well -weyhey - if the whole DoF couldn't grasp what was going on - how could they brief the government or more importantly how would be Minister of Finance know???

It still does not address the core issue which is that Banking Regulation was virtually non existant and the most basic checks on the growth of mortgage business by the Banks should have been obvious to everyone with a hand in regulation.

Patrick Honohan Govenor of the Central Bank says

useful for traditional banking business, were abandoned.
I believe that Irish bank regulation fell into this trap. The business of our banks was not
particularly complex and could have been adequately supervised in the former style. But the
old procedures fell into disuse in favour of the new approach which was, I am afraid, being
applied rather formulaically by both banks and Regulator. I suspect that the banks made their
risk decisions largely independently of the mechanical models and procedures peddled by
Basel 2-compliant consultants. The Regulator lost sight of the details of the banks’ portfolios,
did not scrutinise the quality and extent of collaterals and guarantees that had been given by
the big borrowers (information that could not have been available to outside commentators),
and ultimately failed to question the robustness of the business models. Accordingly the
2 BIS Review 157/2009
supervisors were no longer really in a position to challenge the banks’ complacent view of
the security underlying the property loans they were making and of the threat to their
survival.
Of course,

http://www.bis.org/review/r091207c.pdf

And his report quoted in the Irish Times covers a lot of the same ground as this review

http://www.irishtimes.com/newspaper/breaking/2010/0609/breaking52.html

And the simple old fashioned test that would have shown the problem if applied according to Honrohon is here on Page 11

A very simple warning sign used by most regulators to identify a bank
exposed to increased risk is rapid balance sheet growth. An annual real growth
rate of 20 per cent is often taken as the trigger. Each of the locally-controlled
banks had at least one year in which this threshold was triggered. One of
them, Anglo Irish Bank, crossed it in eight of nine years, and indeed its
average annual rate of growth 1998-2007 was 36 per cent. Another, Irish
Nationwide, crossed the line six out of the nine years, for an average rate of
growth over the nine years of just above 20 per cent (Figure 9). So this was a
very obvious and public danger sign not only for these two banks, but because
of the potentially destabilising effect of reckless competition on the entire
sector (Honohan, 1997). The rapid growth in the market share of Anglo Irish
(from 3 to 18 per cent of the total assets of the six locally-controlled
institutions that subsequently received the Government guarantee) was
certainly an important influence inducing the other banks to relax lending
terms to avoid losing even more market share.10

If you really want a good analysis read Patrick Honahans paper here and assess it against the report.


http://www.esr.ie/Vol40_2/Vol-40-2-Honohan.pdf

The report reads like the DoF merely failed a school test rather than deals with the sheer enormity of the failure.

femur61

Bullseye1 wrote: »

The Canadian person who is responsible for this report indicated on both RTE and Newstalk that the Civil Servents are not innocent in all of this. When it suits them they leak this kind of stuff to the media.

I know the DOF didn't say anything, but I do remember plenty of economists saying the bubble was going to burst. David McWilliams and George Lee spring to mind.

andrewdeerpark

P. Breathnach wrote: »

I interpret that as meaning that you have nothing to back up your claims.

I have as much evidence as you have: a weak report from another civil servant in Canada that does not contain any exact detailed examples of where explicit advice was ignored and the name of the civil servant who issued that ignored advice.

This report is all a bit woolly and lacking accountability and names: useless. As other posters said the civil service are masters of avoiding blame and never put their name on anything, they like to remain faceless bureaucrats.

RichardAnd

andrewdeerpark wrote: »

Cover thy ass at all times. That is the civil service motto. Plus if you are useless at a job instead of being fired you will be promoted out of it because its almost impossible to be fired in the public service.

You don't get promoted in the PS by being an idiot. It certainly happens but problem staff aren't promoted out of their jobs just to get rid of them. No, what happens in the PS to get around the problem of firing staff is what I've heard being described as "sideways promotion".

Basically, in most departments there is a section or a area where no one wants to work and it is into this section that alcoholics, creeps, cronic idiots and just plain incompetents go and once you're in, you don't get out. In short, being fired in the PS is almost unheard of but do not for an instant think that promotions are given to the worst, just because you can't be fired doesn't mean life can't be made difficult for you.

CDfm

Does the report mention anything about Bank regulation ???

This is key issue .

CB Governor Honrohan speaks again.

Banks' mortgage losses could grow - Honohan

Updated: 07:56, Wednesday, 2 March 2011





Central Bank Governor Patrick Honohan has said the mortgage books of Irish banks are a subject of specific scrutiny.
1 of 1 Patrick Honohan - Recommending that €10bn capital was injected by end of March




The Governor of the Central Bank, Patrick Honohan has said that the mortgage books of Irish banks are a subject of specific scrutiny and that there is potential for an increase in losses to do with mortgages.

http://www.rte.ie/news/2011/0302/honohanp.html

Bullseye1

It was reported that more forceful statements by the CS were made but not in writing. Why?

CDfm

Bullseye1 wrote: »

It was reported that more forceful statements by the CS were made but not in writing. Why?

Are we to infer that there was a variance between what was said and what was written.

Were there cyb memo's floating around from the CS to politicians ???

andrewdeerpark

CDfm wrote: »

Are we to infer that there was a variance between what was said and what was written.

Were there cyb memo's floating around from the CS to politicians ???

My point with the CS; faceless bureaucrats who when will never put the key advice down on paper with their signature attached. That is the only advice worth considering.

Bullseye1

If it's put down in writing then there is no hiding from the fact that you were warned in the strongest terms possible.

Aidan1

It was reported that more forceful statements by the CS were made but not in writing. Why?

Because of the Freedom of Information Act - senior Civil Servants were/are aware that putting something like this on record is a hostage to fortune - were it to come out it would be very embarassing to the Minister. It's also very possible that the Minister instructed that he be given no such advice in writing. Thats why the report also recommends that the FOI Act be amended to exclude all budget related advice to the Minister for Finance for 5 years. Anybody who has ever studied State records will tell you that the FOI Act effectively killed the practice of giving Ministers 'straight' advice.

It's a very old fashioned perspective, protecting a politician like that - you would think that they would have learned from the fate of the former Sec Gen of the Department of Health when there was a conflict over what the Minister had been 'told'.

The capacity issue was critical also - it has been apparent for decades that the DoF has never had sufficient 'in house' expertise. Leaving aside the very real possibility that the Dept itself didn't want experts coming in, challenging all the 'gifted generalists' for promotional positions, the question has to be raised as to why the Govt didn't step in and insist that it happened. Were they worried that a newly 'professional' D/Finance would start formally warning them, in public, about the stability of the banking system, or start pointing out the lunacy of the expansion in public spending? Looks very like the independence of DoF was completely broken, as it was subdued by a series of Ministers who disregarded it's advice, acted like they didn't need it, and were resolved that it would never threaten their authority.

P. Breathnach

andrewdeerpark wrote: »

I have as much evidence as you have: a weak report from another civil servant in Canada that does not contain any exact detailed examples of where explicit advice was ignored and the name of the civil servant who issued that ignored advice.

This report is all a bit woolly and lacking accountability and names: useless. As other posters said the civil service are masters of avoiding blame and never put their name on anything, they like to remain faceless bureaucrats.

The report fixes the responsibility on the politicians who had the authority to make decisions, and it tells us that the DoF advised against the decisions that were made.

And still you want to blame Civil Servants, and you now attack the report because it does not buttress your unsupported prejudices.

P. Breathnach

CDfm wrote: »

Does the report mention anything about Bank regulation ??? ...

Of course not. Read the title: Strengthening the Capacity of the Department of Finance. The office of the Financial Regulator is not part of the DoF.

CDfm

Bullseye1 wrote: »

If it's put down in writing then there is no hiding from the fact that you were warned in the strongest terms possible.

Much as I dont like the Corporate State/Social Partnership issue.

There does not seem to have been a Secretary General at the DoF who had a good working relationship with government in the way TK Whittaker had.

TG4 to broadcast story of TK Whitaker, 'Servant of the State'


HE IS probably the only economist in Ireland who refuses to speak about the current financial crisis.
The man who was instrumental in getting Ireland to join the IMF and the World Bank, and played a central role in moving the economy from protectionism and near bankruptcy to free enterprise, liberalisation of trade, and foreign direct investment, has no interest in advising the Government today.
In fact, Thomas Kenneth Whitaker, the renowned civil servant and subject of a biographical documentary on TG4 tonight, insisted on two conditions before agreeing to the project: he would not discuss the current crisis; and the documentary had to be made in Irish.
He joined the Civil Service as a clerical officer, coming first in Ireland in the exam. By the time he was 20 he was secretary to the minister for finance. He became the youngest secretary general of the Department of Finance, when appointed aged 39 in 1956, and subsequently became governor of the Central Bank.
Dr Whitaker was voted by the public as Ireland’s greatest living person at the 2002 ESB/Rehab People of the Year Awards for his role in shaping Irish economic development. As secretary general in the Department of Finance for 13 years, he drew up the document Programme for Economic Development that would dictate development in Ireland for decades.
Dr Whitaker says then taoiseach Seán Lemass knew things had to change and Éamon de Valera recognised that Lemass would be better at those things than himself.
As the economic changes were implemented, however, de Valera remained unimpressed. “He said to me: ‘Tá obair mhaith déanta agat ach tá rudaí níos tábhachtaigh’ [You’ve done good work but there are more important things]”. This was a reference to de Valera’s dream of a Gaelic, simpler Ireland.
Dr Whitaker, who was born in Rostrevor, Co Down, in 1916 and raised in Drogheda, also played a role in the Republic’s relationship with the North, advising then taoiseach Jack Lynch to reject any demands for military intervention in the North.
He also drafted Lynch’s famous speech in 1969 when the principle of consent was first espoused. “He abandoned one of the core principles of Fianna Fáil of unification by whatever means possible,” says Dr Whitaker, of a move that divided the party.
TK Whitaker – Seirbhíseach an Stáit (Servant of the State) is broadcast on TG4 at 8.15 pm tonight.


http://www.irishtimes.com/newspaper/ireland/2010/1227/1224286317154.html

Permabear

This post has been deleted.

ixtlan

I still think that the public has not really grasped what went wrong with the economy and this report confirms my thinking.

Rather than focus exclusively on what the government did wrong, we should consider what they should have done, and then think about how the public would have reacted. In fact we have some indications of that.

When the economy started overheating, the government should have held public spending steady and increased taxes. Just a little. That is what should have happened.

Of all the years in the report, only one year, 2003, was the departments advice listened to. That was the post 2002 election year. Of course the government had again splurged money for the election, but it seems that after that some semblance of sense was briefly regained and the government tried to do the right thing. They did not cut spending, in fact they increased it, but not by quite enough to cover inflation in some cases (an inflation that was ironically caused by massive over spending). I'm not sure how many of you remember the reaction of the public and the political opposition in 2002-3 to this gentle attempt at a correction. Outrage! Horror! Savage criticism! Vilification! So, very quickly the government turned on the money taps again, more spending and cutting taxes, and the good times continued rolling.

So, FF were to blame. If they were leading properly, they should have followed the advice, accepted the unpopularity, and taken a moderate beating at the polls in 2007 for their "savage" cutbacks in a time of plenty. They didn't lead, they gave the public exactly what it wanted, knowing it would collapse eventually, but hoping the collapse would not be too bad.

FG and Labour should be asked the questions, would they have increased taxes and curbed spending during the boom? Who knows? Joan Burton now makes a big deal about having wanted to reduce property reliefs for many years. She did want this, and this would have helped to reduce the bubble. BUT, we should not forget that her reason for wanting to remove those reliefs was to get more tax revenue to fund increased public spending. Having even more spending was not a good idea.

To clarify, I do blame FF. I did not vote for them, in 2007 or 2011, but we must learn from the mistakes of the past and I don't think we are learning quite as accurately as we should.


ix.

Seth Brundle

Permabear wrote: »

This post had been deleted.

Are you only realising now that Lenny is no good with numbers? :eek:

CDfm

ixtlan wrote: »

So, FF were to blame. If they were leading properly, they should have followed the advice, accepted the unpopularity, and taken a moderate beating at the polls in 2007 for their "savage" cutbacks in a time of plenty. They didn't lead, they gave the public exactly what it wanted, knowing it would collapse eventually, but hoping the collapse would not be too bad.

FG and Labour should be asked the questions, would they have increased taxes and curbed spending during the boom? Who knows? Joan Burton now makes a big deal about having wanted to reduce property reliefs for many years. She did want this, and this would have helped to reduce the bubble. BUT, we should not forget that her reason for wanting to remove those reliefs was to get more tax revenue to fund increased public spending. Having even more spending was not a good idea.



ix.

I think all parties spoke about "spend, spend, spend" -it was in their election manifesto's.

Seth Brundle

CDfm wrote: »

I think all parties spoke about "spend, spend, spend" -it was in their election manifesto's.

Yes but it was FF & the PDs that actually spent, spent, spent!

ilovesleep

Regarding blaming the people/electorate: I was in and out from peoples homes for a long time due to my work. During the good times people had busy hectic schedules. Early starts, as early as 6.30am rising from the bed, working all day, arriving home by evening if they are lucky by 7, having kids and families to look after. Putting dinner on the table, putting kids to bed, eventually going to be themselves shattered. Doing the same thing the next day, 5 days a week. Weekends spent doing jobs that should have been done during the week. Finding timeout for winddown like dinner out, or the cinema. Any news pieces regarding this, eg the esri report from 2000, if caught simply would not have registered with people. What Im saying is that the people are not trained economists. All the revelations are now coming together like a jigsaw puzzle. It smacks of disbelief that some people here expects the people of ireland, to sit in their homes, watching the news holding an economics for dummies book.

RichardAnd

CDfm wrote: »

I think all parties spoke about "spend, spend, spend" -it was in their election manifesto's.

Agreed. Does anyone else recall FGs promises of 2000 extra teachers and guards, laptops for every child in secondary school (which would have been used for games/bebo/porn) and 300 a week for the OPA.

2007 was an election of wild spending, from all corners.

Aidan1

FG and Labour should be asked the questions, would they have increased taxes and curbed spending during the boom?

You don't have to ask them, you just have to look at their 2007 election manifestos. These documents confirm your point, which is well made and entirely correct. You would have to hope that, in Govt, they would have exercised more restraint than FF, but the manifestos don't show that. In reality, FF gave the public what they wanted, in exactly the same way as they did in 1977, the last time they completely screwed the Irish economy. This report merely confirms that unelected Civil Servants cannot tell a democratically elected Govt what to do, they can just hope to embarass them into some form of fiscal rectitude.

ixtlan

ilovesleep wrote: »

What Im saying is that the people are not trained economists. All the revelations are now coming together like a jigsaw puzzle. It smacks of disbelief that some people here expects the people of ireland, to sit in their homes, watching the news holding an economics for dummies book.

No, you miss the point. The people have some responsibility, but the majority goes to the political system, and that is not just FF.

FF should have done the right thing, even knowing it would mean a big loss in the next election (2007). However, it would have been easier for them to do the right thing if the opposition was more realistic and honest in what the public could expect as regards sustainable taxes and spending.

You are right that regular people, myself included, are not economists. When FF, Labour, FG, SF and everyone were saying that tax cuts were reasonable, and increased spending was necessary and sustainable then we accepted that. Clearly that was wrong.

With the entire political establishment acting as it did, FF seems to have been terrified of a massive election defeat if they did the right thing economically. The question is how can we avoid this in the future? Blaming FF for incompetence, while true, is not going to help in this regard.

Ix

ixtlan

A few months ago Willie O'Dea was interviewed on the radio by Marianne Finuchan, he touched on the very point we are discussing.

He basically said, at a time when things were booming, it was politically unacceptable to increase taxes.

The question that the media is not really asking, focussed as it is on blaming FF, is How can we (the public/the media/the political system) make it politically acceptable to raise taxes if the economy is doing too well?

In a country with it's own currency the setting of interest rates puts some curbs on overheating economies, and in those cases the decision is usually outside political interference (at least in theory) simply because left to their own device politicians would seldom incur the wrath of the public by increasing rates when times are good. Far easier to blame unelected central bank officials. Since we cannot have out own rates we must somehow create a system where tax and spending policies serve the purpose that a changing interest rate has.

One would expect that the general advice of how much tax/spending to implement could be made public. Maybe we need the central bank, or a panel of economists, to impose a set of limits, so that the politicians can blame them in the good times?

Ix.

Floppybits

ixtlan wrote: »

No, you miss the point. The people have some responsibility, but the majority goes to the political system, and that is not just FF.

FF should have done the right thing, even knowing it would mean a big loss in the next election (2007). However, it would have been easier for them to do the right thing if the opposition was more realistic and honest in what the public could expect as regards sustainable taxes and spending.

You are right that regular people, myself included, are not economists. When FF, Labour, FG, SF and everyone were saying that tax cuts were reasonable, and increased spending was necessary and sustainable then we accepted that. Clearly that was wrong.

With the entire political establishment acting as it did, FF seems to have been terrified of a massive election defeat if they did the right thing economically. The question is how can we avoid this in the future? Blaming FF for incompetence, while true, is not going to help in this regard.

Ix

The thing is that all parties during that time engaged in auction politics and in my opinion any party that did not engage in these tactics would have faced a wipeout at the GE07. I suspect with FG at that time that they were rebuilding after their 2007 wipe out and were afraid to say that they were going to cut spending and raise taxes going into that election which would have led to their death at the polls in the election.

It is something that is we the electorate have to take responsibility for, are you going to vote for a party that will put more money in your pocket at a time when the country is doing well or are you going to vote for a party that is going to take money out of your pocket at a time that the country is doing well?

What I hope as an Irish person that we have learned from what has gone on over the last 8 or 9 years that got us into this position and in the future we never ever fall for the auction politics that have part and parcel of Irish politics since 1977, that we as an electorate weigh up what parties are saying and vote for the ones that are proposing the most sensible policies rather than the ones that are offering you the sun moon and stars.

fred252

ixtlan wrote: »

A few months ago Willie O'Dea was interviewed on the radio by Marianne Finuchan, he touched on the very point we are discussing.

He basically said, at a time when things were booming, it was politically unacceptable to increase taxes.

The question that the media is not really asking, focussed as it is on blaming FF, is How can we (the public/the media/the political system) make it politically acceptable to raise taxes if the economy is doing too well?

In a country with it's own currency the setting of interest rates puts some curbs on overheating economies, and in those cases the decision is usually outside political interference (at least in theory) simply because left to their own device politicians would seldom incur the wrath of the public by increasing rates when times are good. Far easier to blame unelected central bank officials. Since we cannot have out own rates we must somehow create a system where tax and spending policies serve the purpose that a changing interest rate has.

One would expect that the general advice of how much tax/spending to implement could be made public. Maybe we need the central bank, or a panel of economists, to impose a set of limits, so that the politicians can blame them in the good times?

Ix.

there might be something in that idea but i don't think government policy on tax/spending can replace the power to change interest rates and devalue currency. indeed government policy on tax/spending and a devaluation of our currency (assuming we left the euro) is what we need now.

ilovesleep

@Floppybits
correct me if i am wrong but wasn't the green party offering to take in water charges ie offering to take money out from our pockets? Which would tell me that the attitude of the electorate was indeed changing by 2007 and they got in to be in government in 07, as a coalition with FF.

Ixtlan, I agree if during the boom, the government increased taxes and reduced spending there would have been public uproar. It would have shown a lack of understanding from the people/electorate. But again the people/electorate are not economists. Was there any one person turning up on every doorstep warning people that our economy was heading for ruins?

There is no excuse for FF though year on year during the boom they increased say for example SW spending when it should have been left alone. There wouldn't have been any public outcrys if SW rates were untouched. People receiving SW would have continued on as normal. Instead FF gave more away every year.

fred252

does this report make a mockery of bertie's claim that "nobody told me about the property bouble"?

i haven't read the report but i assume it says the DOF suggested changing policy to slow down the property bubble by reducing property tax incentives etc.... this could be a wrong assumption but i'm too lazy to read the report.

P. Breathnach

ixtlan wrote: »

...
One would expect that the general advice of how much tax/spending to implement could be made public. Maybe we need the central bank, or a panel of economists, to impose a set of limits, so that the politicians can blame them in the good times?

The Central Bank should be effectively such a panel of economists. Let's not get sidetracked into the composition of the board: the CB employs a lot of people with economics qualifications, and it could easily enough set up a consultative panel of external economists from the academic or business community. The ESRI might be a key contributor to the process.

The CB might be the close-in, but nevertheless external, body that sets the parameters. But its credibility has been damaged in recent times.

I am willing enough to be critical of Charlie McCreevy's record as Minister for Finance. There is one important good thing he did, albeit functioning as the accountant he is rather than as the economist we needed: he set up the NPRF, which worked as a counter-cyclical mechanism during the boom, both in its real and its artificial phases.

In the 2007 general election, both the main opposition parties cast their eyes on the NPRF as a way of funding their programmes. Had they got in and done so, we might have been in even a worse position to withstand the shock of the property bubble bursting. But the fact that many politicians view reserve funds as readily-available resources is disturbing. That short-termism underpins the case for having a strong agency that limits politicians' freedom to make reckless decisions.

CDfm

Aidan1 wrote: »

. This report merely confirms that unelected Civil Servants cannot tell a democratically elected Govt what to do, they can just hope to embarass them into some form of fiscal rectitude.

John Bruton disagrees with you and he said this on Jan 6 2011

Former taoiseach John Bruton claimed today that the Republic is run by civil servants who use TDs and senators to administer their rule.
In a scathing attack on the political system, he also suggested countless corruption tribunals were necessary because Government ministers were not fully answerable to the Dáil.

“At the present time, the Oireachtas is run by the executive, which in turn is, in a sense, run by the civil service.

“We have a sort of civil service led system of administration which uses the Dáil and the senate as a delivery
mechanism.”




http://www.irishtimes.com/newspaper/breaking/2011/0106/breaking44.html

He should know having been taoiseach.

rumour

P. Breathnach wrote: »

The report fixes the responsibility on the politicians who had the authority to make decisions, and it tells us that the DoF advised against the decisions that were made.

And still you want to blame Civil Servants, and you now attack the report because it does not buttress your unsupported prejudices.

The report supports apportioning responsibility to transient politicians after the event. It is compiled by people who are from the same background as those being investigated. A simple extreme analogy would be crooks auditing crooks.

If the report can only conclude that responsibility lay with people who have now gone and that no-one absolutely no-one who remains of this affair was in any way complicit in brankrupting the country it is of little use.

In fact it is a waste of money as it encourages the status quo. Concluding once the country is bankrupt that no one is at fault is simply not credible.

This reeks of the same type of conclusions the catholic church adopted to clear themselves.

The report is not worth the paper it is written on.

Laminations

Permabear wrote: »

This post had been deleted.

You almost had me agreeing with everything you were saying but then you went and lobbed in the last line.

Again with generalisations - the report does not criticise social partnership just like it doesn't criticise government in general. It cites poor governance and bad social partnership as fuelling our problems. There is a better way of social partnership, also Labour had no hand in delaying this report, that was all FF. We need a truth commission and criminal proceedings

P. Breathnach

rumour wrote: »

The report supports apportioning responsibility to transient politicians after the event. It is compiled by people who are from the same background as those being investigated. A simple extreme analogy would be crooks auditing crooks.

If the report can only conclude that responsibility lay with people who have now gone and that no-one absolutely no-one who remains of this affair was in any way complicit in brankrupting the country it is of little use.

In fact it is a waste of money as it encourages the status quo. Concluding once the country is bankrupt that no one is at fault is simply not credible.

This reeks of the same type of conclusions the catholic church adopted to clear themselves.

The report is not worth the paper it is written on.

So you would have us believe that you know better?

Tell us the facts. If you cannot make a case on anything other than rhetoric, then I will conclude that your post is no more than another unfounded rant.

P. Breathnach

Laminations wrote: »

... We need a truth commission and criminal proceedings

What crime was committed? [I mean crime of the type that might be prosecuted in a court.]

Laminations

P. Breathnach wrote: »

So you would have us believe that you know better?

Tell us the facts. If you cannot make a case on anything other than rhetoric, then I will conclude that your post is no more than another unfounded rant.

Well it seems like an obvious fact, that a report that fingers the culprits after they have rode off into the sunset, is not worth very much. How does the report suggest we avoid this happening again? Does it propose anything in the way of greater transparency or whistleblowing? Any evaluation on workable workarounds?

P. Breathnach wrote: »

Is anything workable?

Exactly. The report seems as nihilistic and pointless as that

Laminations

P. Breathnach wrote: »

What crime was committed? [I mean crime of the type that might be prosecuted in a court.]

I'm talking politicians here, ministers who hid behind the now spurious defence of 'acted on best advice' while they were in office. And I'm thinking criminal negligence - careless, inattentive, neglectful, willfully blind, or in the case of gross negligence what would have been reckless in any other defendant - especially seeing as they did the opposite to what they were advised to do.

P. Breathnach

Laminations wrote: »

Well it seems like an obvious fact, that a report that fingers the culprits after they have rode off into the sunset, is not worth very much.

If those that did the wrong things are now gone, does it become right to pin the blame on those who are still around? I hope that I am never a witness to a hit-and-run traffic incident.

How does the report suggest we avoid this happening again? Does it propose anything in the way of greater transparency or whistleblowing? Any evaluation on workable workarounds?

There are 50 recommendations, all apparently made for the sort of purposes you list.

P. Breathnach

Laminations wrote: »

I'm talking politicians here, ministers who hid behind the now spurious defence of 'acted on best advice' while they were in office. And I'm thinking criminal negligence - careless, inattentive, neglectful, willfully blind, or in the case of gross negligence what would have been reckless in any other defendant - especially seeing as they did the opposite to what they were advised to do.

I really do not believe that a prosecution would succeed. Picture it:
"Your Honour, I say that XXX, when serving as Minister for Finance, did recklessly and negligently, in blatant disregard of advice tendered in good faith by his servants in his Department, increase Personal Tax Credits in such manner as to exempt large numbers of individuals from liability to Income Tax, thereby reducing what is commonly known as the Tax Base."

Laminations

P. Breathnach wrote: »

If those that did the wrong things are now gone, does it become right to pin the blame on those who are still around? I hope that I am never a witness to a hit-and-run traffic incident.

Thats the point, in a hit-and-run witness statements are made with a view to acting upon them and catching the culprits... if reports were drawn up just for the sake of it, then hit-and-run statements would be just a pointless paper exercise benefitting no one. You actually recognise the futility of this report in your next post

P. Breathnach wrote: »

I really do not believe that a prosecution would succeed.

Do you think the DPP wastes time writing up reports if they do not think a prosecution will succeed? So what is the point? Lessons learned, no harm no foul? We'll know better next time? Why? there is no comeuppance, no accountability, no personal consequences for political mistakes - and I'm talking gargantuan mistakes, not the odd wrong decision, a continuing almost decade long policy pursuit against departmental best advice.

P. Breathnach

Laminations wrote: »

... You actually recognise the futility of this report in your next post...

No. I see futility in the use you think the report should serve. It was not set up as a criminal investigation, and it is absurd to dismiss it because of that.

Have you read it yet? The Terms of Reference can be found as Appendix 1, on page 57.

Laminations

P. Breathnach wrote: »

No. I see futility in the use you think the report should serve. It was not set up as a criminal investigation

Yes I know that, care to explain then why you likened it to statements sought after a hit-and-run?

P. Breathnach

Laminations wrote: »

Yes I know that, care to explain then why you likened it to statements sought after a hit-and-run?

No. Either you understand it in its context or you don't understand it at all. I'm not going to be dragged into every cul-de-sac you want to explore.

RobbieTheRobber

Laminations wrote: »

Do you think the DPP wastes time writing up reports if they do not think a prosecution will succeed? So what is the point? Lessons learned, no harm no foul? We'll know better next time? Why? there is no comeuppance, no accountability, no personal consequences for political mistakes - and I'm talking gargantuan mistakes, not the odd wrong decision, a continuing almost decade long policy pursuit against departmental best advice.

No the DPP considers evidence from the Garda and then decides whether or not to attempt prosecution.

It is the Garda that are tasked with gathering the evidence (preparing the report) that will potentially be ignored by the DPP becasue a case is not strong enough to succed in court.

So in answer to your question no the DPP does not, but another state body the garda do, however in some instances the DPP will do reports highlighting to the Garda some of the issues which led to a particular case not being prosecuted so yes they also write reports, nut not the one you asked about.

Laminations

P. Breathnach wrote: »

No. Either you understand it in its context or you don't understand it at all. I'm not going to be dragged into every cul-de-sac you want to explore.

Then stop creating cul de sacs.
The report aimed to assess the quality of advice from the DoF to the government, yes?

report wrote:

In this regard the review will assess the Department’s
o Performance in the past 10 years,
o Advice (appropriateness and quality), forecasts, risk analysis (including of nonconsensual
opinion) and communications strategy, and,
o Development and management of responses to the current crisis.

It found that the DoF discharged their duty satisfactorily but faults were listed re the last stated aim

For example, the department

• does not have critical mass in areas where technical economic skills are required;
• has too many generalists in positions requiring technical economic and other skills;
• is more numbers driven than strategic;
• does not have sufficient engagement with the broader economic community in Ireland;
• often operates in silos, with limited information sharing;
• is poorly structured in a number of areas, including at the senior management level;
and
• is poor on Human Resources Management.

So really what was the purpose of the report? Its findings would either blame or exonerate the DoF. Why does this matter, either way there'd be no consequences. It didn't wholly exonerate the DoF. Even the points listed above won't result in the replacement of generalists with economic graduates, it won't result in the firing of managers or HR individuals within a system that has been labelled 'poor'. And if the report is accurate and the advice was given but dismissed, that moves the finger of blame off the DoF but for what purpose, what is the point of blame if their is no consequence of the mistakes?

(Page 58 is also interesting... the panel of investigators)

CDfm

It still is down to the same thing.

If it was 4 , 5 or even 10 billion of an issue -it would not be the end of the world.

The Core issue is down to Bank Regulation and the collapse of the banking system.The property bubble was caused by reckless lending and regulation is an administrative function (CS/DoF) rather than an Executive Function(MoF)

The CS messed up.

Simple as.

Everything stems from that really.