THE Irish taxpayer is facing a bill of up to €20bn following the nationalisation of the "bust" Anglo Irish Bank.

Taoiseach Brian Cowen and his Finance Minister Brian Lenihan are this evening facing huge criticism following the decision to buy the disastrous financial institution.

As the Taoiseach insisted today that it's "business as usual" for Anglo, Labour's Finance spokesperson Joan Burton told the Herald that the bank is, in effect, "bust".

"My first concern is for the taxpayer because there is no estimate of the likely cost in what the Government has said," she said.

"I fear it will be very significant, as much as €10-€20bn. That would be a pretty calamitous situation for the public finances which are already very tight at the moment."

Finance Minister Brian Lenihan today refused to reveal the level of bad debts at Anglo, saying that was "very commercially sensitive information".

The Taoiseach chaired a Cabinet meeting yesterday by telephone from Japan at which it was decided that the bank would be taken "into public ownership".

Mr Cowen stressed today that all 1,700 employees would be retained at the bank and assessors brought in to see if there is any money to compensate shareholders.

The decision came as it emerged that some staff at the bank received New Year pay increases.

Although the bank is revealing little about the pay hikes, it is understood that the first instalments were paid to some workers this week.

A bank spokesman has said: "Some junior level staff were awarded inflation-linked pay increases. Not all staff will be getting it.

"Middle management and above will receive no pay increases," the spokesperson said.

Asked about whether the Government would now go after Anglo's former chairman Sean FitzPatrick for his massive loans, Mr Cowen said the money would be recouped in the normal way.

The fact that Mr FitzPatrick had loans of €87m, which he hid from auditors and shareholders for eight years, severely damaged the banks reputation in recent weeks.

"Obviously all loans in the bank will have to be paid on terms and conditions they were agreed," said Mr Cowen.

However, Ms Burton said that the Government was now trying to bury the details of Sean FitzPatrick's activities and the Sean Quinn investments in "a veil of secrecy".

"It's the wrong signal to send out to international markets. We need a clean break," she said.

Ms Burton added that job losses now looked inevitable as "its business model is bust".

"The Government has made about five separate attempts to rescue Anglo Irish and each has come a cropper," she told the Herald.

The Finance Minister hit back saying that there was "no option" but to take control of the bank.

But Mr Lenihan refused to "get into cash balances at banks this morning", adding: "The sums involved here are not in anyway comparable to Iceland."

Again describing the bank as "fragile", he said that it was "highly irresponsible" to suggest that customers would start diverting funds from Anglo to other institutions.

And he rejected any suggestion that the decision had been hastened by political lobbying.

Shares in the bank closed at just 22c yesterday after hitting a peak of €17.31 two years ago.

- Kevin Doyle