State inquiry into our financial collapse will not end culture of secrecy in Central Bank
IN the aftermath of the Anglo Irish criminal trial, there was a singular, breathtaking moment. It occurred in the offices of Ireland's most powerful institution, but one which remains its least accountable and most secretive.
Governor Patrick Honohan was asked by financial journalists to respond to Judge Martin Nolan's criticisms of Patrick Neary and the prospects of any disciplinary action against any former staff of the financial regulator. "I won't go there" was his curt, dismissive response to human resource issues, point-blank refusing to discuss any level of accountability or sanction. Nobody was ever censured. The public has to make do with his vague, generalised reassurances that the collapse of our banking system in 2008 would not recur now. It's time to fundamentally review the Central Bank. More important than any banking inquiry is the urgent need to reform the culture in Dame Street.
The Central Bank is not subject to Freedom of Information legislation, despite this being the case in other European states. Patrick Honohan restricts himself to less than a handful of media interviews a year. He is addressed as "Governor" in all dialogue – reminiscent of some localised demigod of the British Empire. This undeserved deference has to stop. Patrick Neary is the public face of catastrophic regulatory failure. However, the institution to blame is the Central Bank. Let's recall the regulatory arrangements: in 2003 the Irish Financial Services Regulatory Authority was established; it was notionally a separate division of the Central Bank; four of its directors came from the Central Bank; on October 1, 2010 full regulatory powers returned under the one roof of the Central Bank. The culture of the Central Bank is deeply offensive to the Irish people through its approach to confidentiality. Detailed questions about solvency of individual credit unions are subject to the standard response of "no comment". A wall of silence.