Readers like you keep news free for everyone.

More than 5,000 readers have already pitched in to keep free access to The Journal.

For the price of one cup of coffee each week you can help keep paywalls away.

Support us today
Not now
Dublin: 13°C Friday 12 August 2022

'It makes no economic sense': Sale of state assets criticised by opposition

Sinn Féin and Fianna Fáil have both criticised the government’s announcement on the sale of State assets today.

Howlin outlined the sale of State assets at a press conference today.
Howlin outlined the sale of State assets at a press conference today.
Image: Laura Hutton/Photocall Ireland

THE DECISION BY the government to sell State assets in an attempt to raise €3 billion has been criticised by opposition parties, one of whom said it “makes no economic sense”.

Public Expenditure and Reform Minister Brendan Howlin said earlier today that parts of Bord Gáis and ESB are to be sold off with the State also considering selling off some assets of the forestry body Coillte and its 25 per cent shareholding in Aer Lingus.

Howlin said that of the €3 billion the government hopes to raise, around €1 billion would be used for the purposes of job creation while the rest would go towards servicing the country’s debt.

But Sinn Féin’s deputy leader and spokesperson for public expenditure and reform, Mary Lou McDonald, said that the decision was “a bad policy decision” in light of the €3 billion the government looks set to pay unsecured bondholders in the now-defunct Anglo Irish Bank next month.

“Both the ESB and Bord Gáis are wealth generating self-financing companies that have invested heavily in first world energy infrastructure across the island and created thousands of good jobs benefiting hundreds of thousands of families over the decades,” she said.

“Fine Gael and Labour’s decision to treat the profitable elements of these companies as a cash cow for bank debt reduction makes no economic sense and reflects the kind of short term policy and political decision making that got us into this economic mess in the first place.”

Meanwhile Fianna Fáil’s spokesperson on public expenditure and reform, Sean Fleming, said that Howlin’s statement that he had secured a concession from the Troika on the use of the proceeds from the sale of State assets was “brazen in the extreme”.

“It was never agreed with the EU-IMF by the last Government that state assets would be sold,” he claimed. “It was never agreed that if assets were to be sold that the proceeds could only pay down the debt.

“The first person to ever agree that the sale of state assets could be used to reduce sovereign debt was Minister Howlin who signed up to this during recent EU-IMF review.

“He is using the small concession that one third of the proceeds can be used for reinvestment to hide that fact that he has agreed that two third of the proceeds will be used to pay down debt.

Making a difference

A mix of advertising and supporting contributions helps keep paywalls away from valuable information like this article.

Over 5,000 readers like you have already stepped up and support us with a monthly payment or a once-off donation.

For the price of one cup of coffee each week you can make sure we can keep reliable, meaningful news open to everyone regardless of their ability to pay.

“The extent to which the Labour Party is misleading the public and hiding from the reality that they have bought into Fine Gael’s privatisation agenda is extraordinary. ”

Both TDs specifically criticised the sale of ESB and Bord Gáis with Fleming saying that the sale would “inevitably” lead to higher prices and job losses at both companies.

Sinn Féin’s spokesperson on energy, Martin Ferris, said that the decision to sell off parts of Ireland’s forestry was “a disgrace”.

He said it would be interesting to see who bought up the forests that may be sold given previously expressed interest from a Chinese corporation and following Chinese Vice President Xi Jinping’s visit to Ireland last week.

Read: Parts of Bord Gais and ESB to be sold off to raise €3bn

Explainer: Which State assets are being considered for sale? >

Previously: Rabbitte, McGrath in war of words over state assets >

About the author:

Hugh O'Connell

Read next: