The Government is to hold a referendum later this year to enable Oireachtas committees to compel witnesses to attend hearings. The development follows the publication of the Nyberg Report into the Irish banking crisis.
At a press conference this afternoon, Finance Minister Michael Noonan said the previous Government had failed to deal with the Abbeylara court decision which had limited the powers of investigation of committees.
Mr Noonan said the Government would ensure that the report would be referred to the Oireachtas so that it could make recommendations for the future of the banking sector.
He also said the Government would be taking action to strengthen its oversight of the banking sector.
Financial institutions will be asked to provide board renewal plans to ensure that members have the appropriate skills and competencies. Board members appointed before the 2008 guarantee would step down first as part of a planned rotation.
In addition, Minister Noonan announced the setting up of a stand-alone body to manage the Government's holdings in the financial sector and to oversee the restructuring of banks. Initially this unit will work within the Department of Finance, but it will eventually become more independent while still reporting to the minister.
In response to the Nyberg report, AIB said it had decided that more changes were needed among its top management, and it expected to announce the names of some new managers shortly.
It also said three board members who were appointed in 2007 had decided not to stand for re-election at the bank's next shareholder meeting. It said all other remaining board members had been appointed over the last two years.
The bank said that it is undergoing a fundamental restructuring, including the establishment of a core and non-core bank.
'A large amount of remediation activity is also needed to ensure the bank is able to operate in its new form and in accordance with the emerging new governance requirements,' said the bank.
Bank of Ireland said it co-operated fully with the investigation and made extensive information available. In a statement, it said it would study the findings and recommendations carefully and address them as they applied to the bank.
Bank of Ireland also said it would provide a 'considered and comprehensive' board renewal plan to the Minister for Finance.
The head of the Irish Bank Officials' Association, Larry Broderick, said it was a matter for the Government and the financial institutions whether people should be fired in the wake of the banking crisis. But he warned that there was no track record in the industry of people being fired.
He said the Nyberg Report correlated with the IBOA's analysis over the last few years that greed was the focus of the problem. He blamed the culture of maximising profit at the expense of staff and customers.