The banks were "very definitely" bailed out and it is "insulting" to suggest otherwise, according to a People Before Profit TD.
Taoiseach Micheál Martin claimed in the Dáil yesterday that it never happened and said the State took equity in the banks involved.
He had been responding to questions about ex-Debenhams workers and possible solutions to the ongoing dispute about redundancy packages.
The Taoiseach said Richard Boyd Barrett lived in a financial fantasy land and that if the PBP TD was in power, "thousands and thousands of jobs would migrate from this country".
Speaking on Newstalk Breakfast this morning, Deputy Boyd Barrett said bondholders, who were "super-wealthy global speculators", and who put money into the banks were "very definitely" bailed out.
He said this was at "an enormous cost and a decade-long of austerity" or working people in Ireland, "a cost which we're still paying".
Deputy Boyd Barrett added: "That was money diverted away from building public housing, away from employing enough people in the health service.
"It's really quite insulting for the Taoiseach to suggest there wasn't a bailout, because people know and they felt the pain of that bailout.
The TD for Dún Laoghaire said he drew an "absolutely legitimate contrast" in the Dáil yesterday between this and groups of people like Debenhams workers and student nurses
He said: "We absolutely said definitively no to bailing out the senior bondholders in the banks, so it's about choices.
"Do you prioritise the bondholders, the gamblers, who wrecked the economy, who speculated on property and crashed our economy, or do you prioritise working people who have worked very hard all their lives, have done nothing wrong?"
'A stupid narrative"
On the same programme, Fianna Fáil TD Niall Collins, Minister of State for Skills and Further Education, said the banks were capitalised by the State after equity was taken in the financial institutions involved.
This was done to protect our economy and money payments system, a move which opposition TDs such as Deputy Boyd Barrett don't have to worry about, Deputy Collins said.
He added: "In the real world, the real Government has to concern itself with small businesses and jobs and act responsibly, and that's the choice the Government made at the time.
"The Government stepped in...and took drastic measures to protect our economy and jobs."
Deputy Collins said it was "a stupid narrative that Richard and others in his group go on with in relation to all these issues".
Deputy Boyd Barrett responded: "I think there's a deep irony in Micheál Martin referring to fantasy or indeed Niall talking about stupid narratives, nothing could be more fantastic or more stupid than the Taoiseach of the country suggesting the bank bailout didn't happen.
"That is fantasy in its most extreme and bizarre form."
