The Government is to consider changing the law so future tribunals of inquiry will be able to order people who do not co-operate fully to pay the costs incurred as a result.
This follows yesterday's announcement that the Attorney General will not seek to have Mr Charles Haughey ordered to pay all or some of the costs of the McCracken Tribunal and other parties represented at it.
Taxpayers will now pay these costs, while Mr Haughey will pay only his own costs.
A Government spokesman indicated yesterday that a change in the law might now be needed to accommodate the terms of reference for the Moriarty tribunal, which is to examine payments to Mr Haughey and Mr Lowry and is expected to hold oral hearings early next year.
The terms of reference for the Moriarty tribunal state that "all costs incurred by reason of the failure of individuals to co-operate fully and expeditiously with the Inquiry should, so far as is consistent with the interests of justice, be borne by those individuals".
The spokesman said the Tribunals of Inquiry (Evidence) (Amendment) Act 1979 does not appear to allow for such tribunal costs to be borne by these uncooperative individuals. The Government would, therefore, review the law with a view to changing it.
The greatest expense caused by Mr Haughey's attitude to the McCracken tribunal was incurred by the tribunal itself, which travelled to London and the Cayman Islands in its effort to prove that £1.3 million paid out by Mr Ben Dunne was received by Mr Haughey. Expensive work was also undertaken by the Guinness & Mahon bank and Irish Intercontinental Bank at the request of the tribunal and for the same reason.
The amount involved, now to be paid by the State, would be hundreds of thousands of pounds.
This decision not to seek an order against Mr Haughey was taken by the Attorney General, Mr David Byrne, on the advice of the Chief State Solicitor, Mr Michael Buckley. On Monday a letter was sent from the Chief State Solicitor's office to Mr Justice McCracken, informing him of the decision.
The decision was based on three grounds, according to the letter from the Chief State Solicitor's office. Firstly, the law did not allow the tribunal seek its own costs from Mr Haughey, but only the costs of others represented at the tribunal.
Secondly, the costs incurred on other persons, as opposed to the tribunal itself, were relatively modest. Thirdly, the cost of seeking an order against Mr Haughey might be higher than the costs he was liable to pay.
In a letter on Thursday the judge replied: "It seems to me that your decision is a sensible one from a practical point of view."
The decision was condemned by the Democratic Left whip, Mr Pat Rabbitte, and by Green Party TD, Mr John Gormley, who termed it "a national disgrace".
Mr Rabbitte said that despite Mr Haughey's "appalling conduct, he managed to evade any responsibility for additional legal costs, he continues to receive a very generous pension from the State, and retains all of the privileges accorded to other former Taoisigh".
Mr Gormley said he could not accept the Attorney General's reasoning that the pursuit of Mr Haughey had to be abandoned because of the additional expense this would incur.
"By lying to the tribunal, Mr Haughey increased the cost massively for the tribunal and now he is being allowed to walk away from the situation he created without paying his due," he said.