Tuesday 15 October 2019

Defiant McCreevy denies his policies fuelled bubble

'You only apologise for things you got very much wrong ... I don't believe that I did'

Charlie McCreevy speaking at the inquiry yesterday
Charlie McCreevy speaking at the inquiry yesterday
Former finance minister Charlie McCreevy in 2003. Photo: Tony Gavin

Clodagh Sheehy

Former finance minister Charlie McCreevy has claimed that the Fianna Fáil government he served in before the economic crash was "the most responsible than any other government in the history of the State".

During a heated day of evidence before the Banking Inquiry, Mr McCreevy had to be warned he could face criminal sanctions unless he discussed whether or not he believed a property bubble took place.

And he denied any wrongdoing during his term as finance minister between 1997 and when he was appointed EU Commissioner by Bertie Ahern in 2004.

Read more here: Ex-minister has convinced himself everything was fine when he left it 

"You'd only apologise for things you got very much wrong. I don't believe that I did," he said.

Mr McCreevy, who received a ministerial pension of almost €54,812 last year on top of an EU pension, was also asked about his relationship with developer Sean Dunne, whose wedding he attended in 2004 on Aristotle Onassis's yacht, 'Cristina O'.

Pearse Doherty questions Charlie McCreevy at the inquiry yesterday
Pearse Doherty questions Charlie McCreevy at the inquiry yesterday

He confirmed he had been friends with Mr Dunne for many years but said: "I think this is a ridiculous question, deputy, with respect."

His unapologetic performance came ahead of his successor in the Department of Finance Brian Cowen's appearance before the inquiry today.

At one point, the inquiry was suspended for 17 minutes as Mr McCreevy refused five times to answer the question put by Deputy Pearse Doherty.

The committee sought legal advice and when the meeting resumed, chairman Ciaran Lynch told Mr McCreevy if he refused to answer a question, "which falls within your direction, you may be subject to criminal sanctions under section 75 of the Houses of the Oireachtas".

Former finance minister Charlie McCreevy in 2003. Photo: Tony Gavin
Former finance minister Charlie McCreevy in 2003. Photo: Tony Gavin

Read more here: 'State saving scheme wasn't suggested to me in chat at the Galway Races' 

He also told him the committee could make a finding against him that he had refused to comply and could put him on notice that he would have to return next week to face a broader line of questioning.

The conflict arose when Mr Doherty asked the former minister if he believed there had been a property bubble in the previous 15 years before the financial crisis.

Mr McCreevy insisted he would only answer for his time in office and there had been no property bubble during that time.

He said he made a self-imposed vow not to comment on any aspect of public life when he left office in 2004.

"I said that's what I was going to do when I finished public life and I've stuck by it, even though I've been sorely tempted…," he added.

He said he did not have a view on what happened after his time in office.

At this point the committee went into private session and when the public session resumed Mr Doherty repeated his question as to whether there was a bubble between 2003 and 2007.

Read more here: Chutzpah Charlie declares himself to be a winner all right 

Mr McCreevy then agreed that figures indicated that house prices during that time had gone up to "an extraordinary degree".

In response to further questions, he said he did not believe the policies he pursued as minister had helped to create that bubble.

Asked by Mr Doherty if, with hindsight, he should have heeded the warnings from the Central Bank about excessive growth and overheating and should have been more cautious in taxation and spending policies, Mr McCreevy said "No".

He believed he had done nothing wrong during his term of office, adding: "I think I did a very good job."

Read more here: McCreevy gets legal warning after refusal to answer bubble question 

If he was being asked to apologise, he added, "you'd only apologise for things you got very much wrong. I don't believe that I did".

He said he extended a raft of tax concessions in his final budget, despite promising to end them, because "I changed my mind". He did not think this fuelled the property bubble "because most of the tax schemes had little to do with property".

'Swagger' drives a strong defence of record

  • Charlie McCreevy said his most infamous quote - "If I have it, I'll spend it" - has been misrepresented "to a staggering degree", like many celebrated political quotes.
  • He said the full quote is faithfully recorded in the Irish Independent of November 16, 2001, and reads: "When you have it, you spend it. The mistake is to try to spend it when you haven't got it." The context was that he was blocking increased government spending ahead of the 2002 General Election.
  • Much of the old McCreevy swagger remained. A recess and a legal warning from the chairman were required to get him to answer if he believed Ireland had experienced a "property bubble". Up to then, he had insisted there was no property bubble on his watch as finance minister from June 1997 to September 2004.
  • Mr McCreevy said from 2003 to 2007 house prices grew at an extraordinary rate. He supposed that was a bubble. But he said: "I don't believe the policies I pursued helped to create that bubble."
  • On reports of him "socialising" with former Anglo boss Sean FitzPatrick, he said he knew Mr FitzPatrick since the early 1970s as they were both accountants. He "ran into him a few times socially" but they never played golf. Mr McCreevy said he had not taken a drink in over 20 years.
  • He was asked about reports by former Finance Department chief Kevin Cardiff that he was among those promoting a bank guarantee as applied in autumn 2008. Mr McCreevy said he had no recollection of any conversation with Mr Cardiff on this. But he probably had, months before the guarantee, advocated a broad statement of guarantee.
  • Mr McCreevy said his decisions as finance minister were driven by political considerations. "We are politicians, don't forget we like to get re-elected." But he insisted prudent economics ruled. "We were the most responsible government in the history of the State. No other government in the history of the State had budget surpluses."

Irish Independent

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