The Taoiseach has said he wanted to introduce legisalation on a statutory code for banks that would work to prevent repossession orders on people's homes.

He said it would allow people in difficulties with their mortgage payments to sit down with the banks and reach solutions.

Mr Cowen has said that he expects the Government's recapitalisation of the two main banks to be finalised in the coming days.

It is expected that €7 billion will be injected into Allied Irish Bank and Bank of Ireland to stimulate banking activity.

The move is designed to create credit for loans and help to revitalise the economy.

Speaking on RTE radio today, Mr Cowen said recapitalising the banks was about promoting external confidence in the Irish economy.

NDP to be scaled down - Cowen

The Taoiseach said that the National Develop Plan will not go ahead in all its facets, as it was based on a forecast of 4% economic growth annually.

Speaking on the Marian Finucane show, Mr Cowen said that targetted expenditure would see significant investment in higher education and research & development, and

He said it would also target efforts to bring business ideas to fruition in order to develop what he called a smart economy, and so generate jobs.

Fine Gael leader Enda Kenny had called on the Government to scrap the Plan, claiming it is filled with ‘unachievable’ political targets, and amounts to a wish list for every Fianna Fáil member in the country.

Responding to the comment that there was reckless lending in the banking sector, Mr Cowen said that there were also governance issues in banking which are now being addressed.

Mr Cowen said that the global economic crisis had shown that membership of the European Union was critical to Ireland's fortunes and survival.

Mr Cowen also said that people were concerned at how quickly the change in our economic fortunes had occurred.

He said that in some cases things would get worse before they got better, but affirmed that we could come through this if we made the right decisions now.