Opposition claims ‘legal gag’ will prevent proper inquiry

OPPOSITION claims that a “legal gag” will prevent the Governor of the Central Bank from playing a role in the banking inquiry have been dismissed by the Taoiseach as just another conspiracy theory.

Professor Patrick Honohan, who first called for such an inquiry in December is “satisfied” that he can complete the work asked of him by the Government within the current laws.

He gave the assurance in response to claims by Labour Party who said there were “serious legal doubts” surrounding his role in the inquiry.

Prof Honohan has been asked to write a report on “the performance of the respective functions of the Central Bank and Financial Regulator” from its establishment up until September 2008.

This report will be one of two “scoping documents” which will determine the issues to be investigated by the commission of investigation and potentially inform an Oireachtas inquiry.

But Labour pointed out that a “legal gag” contained in the Central Bank Act 2003 prohibits him from “publicly discussing or disclosing in any manner any commercially confidential information in relation to any regulated firm or individual”.

Labour’s Finance spokeswoman Joan Burton said the law must be amended if Mr Honohan is to have any “meaningful role” in the inquiry.

“It is difficult to see how any inquiry undertaken by him can contribute to public knowledge on the events that led to the banking crisis,” she said.

“This is just another example of legal pitfalls and the capacity for delay in the convoluted process the Government has come with in other to avoid, at all costs, the public, open, Oireachtas driven inquiry that Labour has been seeking.”

But when challenged on the issue in the Dáil, Taoiseach Brian Cowen said Ms Burton “is very good at conspiracy theories and this one is as good as it gets”.

He said: “Prof Honohan has agreed to do the job he has been asked to do and will do it. He has no intention of doing anything illegal. He will do his job.”

Similarly, Finance Minister Brian Lenihan last night insisted that Mr Honohan would not be barred from expressing his views on the matters he will be examining for the scoping document. Mr Lenihan said Mr Honohan was in an “ideal position” to look at these issues and prepare the report.

A spokesperson for the Central Bank said: “The Governor is satisfied that he can complete the work he has been required to undertake within the existing legislation.”