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Dublin: 7 °C Tuesday 18 February, 2020

Mortgage relief, EU summit, the IRA and an Anglo default: an eventful morning in the Dáil

It was a busy session of Leaders’ Questions…

ENDA KENNY has been challenged on government plans for cutting mortgage interest relief programmes, his agenda for tomorrow’s EU summit in Brussels, and the repayment of Anglo Irish Bank bonds in an eventful morning in the Dáil.

Kenny and Fianna Fáil’s Micheál Martin locked horns over the government’s plans to change the mortgage interest supplement scheme, saying Fianna Fáil would be seeking a Dáil vote to overturn planned changes.

Martin reported that Joan Burton had issued a statutory instrument which would see that scheme abandoned – a move the FF leader said “essentially begins the cutting out of mortgage interest relief”, a separate scheme.

“How can the Labour Party stand over phasing out the ending of the scheme?” Martin asked. “Where is the social solidarity?”

Kenny said the move was part of the reforms recommended under the Keane Report on mortgage arrears, a claim Martin contested.

Referring to last night’s announcement that the new insolvency legislation would be published on Friday, the Taoiseach said he wanted to make it “perfectly clear” that the legislation would address only people who “can’t pay” and not about those who simply wouldn’t.

This was unrelated to the Keane Report, he said, commenting that the use of legislative means for debt resolution would be lessened if other codes of practice were followed.

“You seem to be blissfully unaware about a measure that your social welfare minister took, that basically restricts low-income families” from accessing mortgage relief schemes, Martin accused.

The EU and the IRA

Sinn Féin’s Gerry Adams was next up, citing Kenny’s Irish Times interview this morning – where he admitted Ireland would not be “the focus” of leaders’ attention – as evidence that Kenny was simply not raising Ireland’s concerns at European level.

Adams concluded that Kenny was in favour of “even more dilution of Irish sovereignty and even more EU involvement in state budgets,” and asked the Taoiseach if he favoured “EU federal propositions”.

Kenny said this was “wrong on all counts” and listed the various measures – including project bonds, liberalisation of European Investment Bank funding and the redeployment of structural funds – he had pushed in Brussels.

“The challenge is to find politically a creative way of not withdrawing money from envelopes which are allocated to individual countries,” Kenny said, pointing out that Greece and Romania currently had European funds set aside for them which they were unable to use, because they could not match the EU funding with their own domestic investment.

“The problem that we face here is that, if you accept the principle of European decision-making and European sharing of liability, the corrolary is also true,” the Taoiseach said, saying the previous government had “lay down” in front of previous directions given by Europe.

“The principle of the acceptance of European decisions, and the European sharing of liability, was not applied in this country – to our cost,” he said.

Adams accused Kenny of “extreme revisionism” and told Kenny not to pretend that his trip to Brussels was akin to “a Munster final” where he was attending as a spectator rather than a player.

The Taoiseach took exception to the former remark, pointing out the historic events in Belfast and suggesting that Adams himself was also looking to revise history, quipping:

There’s one thing I have in common with you – and that is that neither you nor I were members of the IRA, or the IRA Army Council.

Anglo bondholders

For the technical group, Richard Boyd-Barrett complained about the full repayment of unsecured and unguaranteed Irish Bank Resolution Company bonds to their holders, saying there was a “very simple and very cruel” truth to the repayments.

“Somewhere in the Mediterranean or the Caribbean, a multi-millionaire speculator will be cracking open a bottle of champagne,” while Irish families were made homeless and schools lost teachers, Boyd-Barrett said, issuing a stark order to Kenny.

Refuse to enrich the multi-millionaire speculators in Anglo Irish bonds, and go to the European Council and tell Angela Merkel that we’ve had enough.

Kenny said he shared the dismay that the public had to honour banking debts, but pointed out that most of Anglo’s post-guarantee liabilities had been met under the previous government.

Defaulting on Anglo’s remaining bonds, he said, would raise doubts over whether other Irish banks might do similarly, and whether they could access the necessary liquidity from the ECB.

Boyd-Barrett suggested Kenny believed maintaining good relationships with bondholders was more important than the provision of services to children with learning disabilities or small rural schools.

“Half a billion euro, you are intending to pay back to these bondholders, so that our reputation is good with them – is that what you’re saying? Angela Merkel must absolutely adore you at this stage.”

Kenny suggested that Boyd-Barrett’s suggestion of walking away from IRBC’s remaining obligations would damage the reputations Ireland had built up since the EU-IMF bailout.

“If you think that in that ruthless world of commercial lending, where these situations apply, that this country can expect to continue to be funded if we were to default or not measure up to our responsibilities… at least Ireland’s reputation in the sense of a country that will do what it says it will do [...] provided we get the extra assistance and flexibility shown to us,” he said.

The Taoiseach quipped that Boyd Barrett did not “live in the real world” to think otherwise, describing his policies as “absolutely nonsense”.

Read: Government calls banks in over mortgage arrears

More: Kenny calls for sharing of bank debts – as Merkel again rules out Eurobonds

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Gavan Reilly

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