CRISIS REFERENDUM:MINISTER FOR Finance Michael Noonan has said the Government intends to hold a referendum later this year to pave the way for an Oireachtas committee to begin an inquiry into the banking collapse.

Mr Noonan said yesterday he would prefer if the Nyberg report into the causes of the banking crisis could be scrutinised by a committee of TDs and Senators.

He said the failure of the previous Fianna Fáil-led governments to act in response to the High Court judgment on the Abbeylara inquiry meant it was not possible at present to conduct a parliamentary inquiry. He said the Cabinet had taken a decision yesterday to hold a referendum later this year to empower committees to investigate such matters.

Mr Noonan added the Government had made other decisions in response to the report’s findings.

He said he had asked the chairmen of all the banks to provide the Minister and the National Treasury Management Agency (NTMA) with a “board renewal plan”, beginning with the replacement of any directors in place prior to the decision on the bank guarantee in September 2008.

He said AIB already moved in this regard yesterday, announcing three directors in place since 2008 or earlier would not seek re-election at the bank’s agm in July.

“I do not hold directors personally culpable for what happened, but it happened on their watch. I am glad that they are moving on and new people are being appointed,” Mr Noonan told a news conference.

He said he would request each bank to draw up a “management renewal plan” to ensure those who run banks have adequate risk-management experience.

The third new initiative, he said, was to ensure the banks continued to have independent non-executive directors. It was essential they had appropriate skills and qualifications, he said. He would be creating a “pool” from which such directors could be selected.

On State oversight, Mr Noonan said he would bring forward proposals to set up a stand-alone unit, initially within the department, to manage the Government’s holdings in the financial sector and to drive bank policy.

Asked about the report’s conclusion that it was “understood” why the previous government decided to give a blanket guarantee to the bank, Mr Noonan said this did not mean it was absolving that government from blame.

“The style of the Nyberg report – it’s written in a diplomatic manner. At first reading one does not get the full implication, [but] it’s very tough in content. There’s an argument that it was a false consensus that drove banking and the country to the edge of the cliff, and there was a herd instinct.” A former taoiseach, he added, had told people they would be better off taking their own lives.

“That would have been in Peter Nyberg’s head,” he continued. “Also, the Government fuelled it. He was thinking of various tax breaks. On a number of occasions, he hits very hard on political responsibility. When you string them together – although it’s diplomatically drafted – there’s a lot of tough stuff,” said Mr Noonan.

In relation to the total €3 million package paid to AIB’s former managing director Colm Doherty last year on his retirement, Mr Noonan said there may be some other banking executives entitled to a similar kind of deal.

Asked about the banking referendum, he said the law was complex. “The Attorney General [Máire Whelan] has assured me that she can bring forward a framework to have a referendum this year,” he said.