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Updated 5.37pm
FINANCE MINISTER Michael Noonan paid a whistle-stop visit to The Hague this afternoon to scope out Ireland’s post-bailout strategy.
Noonan had what what was described as a “constructive meeting” with Eurogroup President Jeroen Dijsselbloem to discuss whether or not Ireland will accept a line of precautionary credit when it exits the bailout programme next month.
The Department of Finance said in a statement this afternoon that “there are a number of options available to the Irish Government and it is matter for the Government to decide on the best approach”
Strict conditions could prevent the Irish government from opting for the ‘safety net’ that could be used in the event of the economy requiring further stimulus after the bailout exit.
Noonan said earlier that his meeting with Dijsselbloem would be good as the Dutch politician has “lot of political information which will be useful”.
Speaking before his meeting with the Cabinet this morning, Noonan said that Dijsselbloem provides an important link with other European governments.
He also said that the decision on the credit line is “finely balanced”, but said he wanted to gather the best possible information prior before bringing a memorandum before government.
In a comment released after the meeting, Noonan repeated this view, saying: “The objective is to secure a sustainable exit that supports economic growth and job creation.
“Broadly speaking, the options are to either exit the programme with or without a prearranged backstop. The decision is finely balanced.”
- additional reporting Hugh O’Connell
First published 11.18am
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The article is using the term ‘bailout’ very loosely. What happened was that the National Pension Reserve Fund was raided for €17.5 billion and transferred to the European Financial Stability Facility & Mechanism (EFSF&M) funds. The Troika then generously allowed us to borrow €67.5 billion from the EFSF&M which we are paying back with interest. €64 billion of this has been used directly cover private and illegitimate banking debt. In this way the Troika gets to have the eurozone banking system stabilized at the expense of the Irish people and we get to pay for the privilege via the interest we pay on the debt.
This does not include the €32 billion also borrowed that we have pumped into NAMA
to indirectly prop up the banks by taking the bad commercial property loans off their books.
Adding the 3 figures together (17.5 + 64 +32) gives a total cost of around €113 billion and counting for the bank bailout so far. Most of this money has been borrowed and the interest payments make up a major component of our annual budget deficit. Whatever this is, it’s not a bailout. Ireland is digging its own economic grave and the Troika are billing us for the shovel.
Great contribution. Is it accurate?
It is accurate….
In 5 years we went from being a country having the lowest national debt (bar luxembourg) to one of the most heavily in debt… bar Greece etc.
Handing over the bulk of the NPRF was a real kicker.
What is staggering is that within the next year or so all income tax reciepts will go on servicing debt interest alone.
People may not be aware, the government have covered most of the defecit already.
When we hear “borrowing a billion a month” statement, 2/3 of that defecit is debt interest!!
Its horrifying the debt burden that has been placed on us in such a short space of time.
Sweet jesus..thats a lot of money!
Must be almost the equivilant of every mortage in the state!
Imagine…we could be mortage free..Thanks..Fianna Fail..I wont forget you.
Was the credit line not guaranteed with no strings attached when we passed the lisbon treaty?corruption.
Gut feeling says we will accept this line of precautionary credit.
At what condition(s) I wonder.
I think you’re right, particularly as most of that 25 billion euros Noonan says we have for next year is actually borrowed money that is costing us 850 million euros a year in interest.
If I had any spare, I’d put money on Budget 2015 being a lot harsher than the government would have us believe.
Italy has bunga bunga, Ireland is going to have wonga wonga backing it up
Anyone else remember fine gael and the europeans putting a gun to our head that we would not have access to european credit post-bailout if we did not vote for the fiscal compact?
We signed away control over our budgets on yet another pack of lies. Wonder what else they’ll be looking for off of us now…..
It’s a line of credit that is being forced on us, the Irish experiment continuous with the IMF. We are their obedient plaything.
There is no evidence future Troika credit is being forced on Ireland.
If Ireland sources future debt from the bond markets, the troika wont really care.
Unfortunatly Ireland will do what it is told like the lapdogs we are. The school master will always do what the headmaster says.Until our politicians grow a pair of liathroidi we are destined to be the slaves of Europe.
Dont like the smell of this…
If we accept there are obvious conditions
if we decline they use their influence to price us out of the markets.
our country is owned by the IMF
Sean
The IMF lent us money at a time that nobody else would and their conditions as imposed with the other two members of the Troika were relatively straightforward and fair. We had to bring our spending as a State back in line with our income. Quite reasonable for a lender of last resort to demand fiscal behaviours that are normal around the developed World.
If we want a further line of credit which would be similar to an overdraft when we exit the Bailout in December then as with all such facilities even from your local Bank there would be conditions attaching.
Why would there be anything sinister about such an arrangement when such conditionality is routine and commonly practiced in all spheres of public private and corporate life across the globe. Or do you have knowledge and experience that somehow provides you with insight unavailable to the rest of the world?
Richie check out a documentary called the shock doctrine and come back to me
theres a good man…
Severest conditions set by the EU side of the troika like a high interest rate to “punish” the Irish. The IMF wanted unsecured bond holders to be burnt something the EU set their face against. Only reason that the interest rates were dropped is because Portugal got into difficulty and refused to accept that rate.
I’d be happy to work with the IMF which at least have some experience in this area rather then the EU (amateurs) which is using Ireland as a social experiment.
Dobt firget Geithner said no to burning bond holders too.
I dont think its the IMF people are worried about, they are pussycats compared to our “EU Partners”
Noonan not sure just how much more the docile Irish population is willing to take?
Why is it necessary for Noonan to travel to the Hague to “scope out” anything whatever? What is wrong with telephones, video conferencing etc.,? I have a pain in me arse with this carry on. If Noonan wants to accept yet another loan with enormous and onerous strings attached will anyone be surprised? Will it in any way affect the forty years of debt which has been loaded onto the country thus far? – I think not. More ado about absolutely shag all.
No photo op in a phone call, he wants to be seen like Richard the Lionheart heading of on a white horse to to “battle” with europe
Finely balanced? No it’s not. If we want a decent rate from the markets we have to have the safety net. Classic Noonan speak. He is just avoiding answering the question until December 14th when he will say that his hands were tied and he had no real choice but to take the facility.
Ben Gunn Is this a second “bailout” by a different name?
Taxi Bill , no, it only becomes a bailout if we have to draw on it, otherwise it is a standby facility. It’s purpose is to make sure the bond markets do not try to impose punitive rates on us when we exit Troika support. These are unchartered waters, Ireland being the first country to exit a Troika structured support programme.
We have to ave the facility
If they want to solve the country’s problems default on our illegal national debt,nationalise our energy and maritime resources(which are worth trillions) and secede from the E.U to the E.E.A.Theese three factors alone would contribute enormously to getting the irish out of this situation.The funny thing is we are an extremely wealthy country we just don’t own any of our wealth.
Merkel will tell Enda to tell Noonan what to do
I get the feeling that ”debt credit line” is comparable to a business opportunity for a visa type credit card company dying to get hold of some of the nation’s new debt. I am sure somewhere they are itching to get potato head to sign up to it , meanwhile he presents it as a tough dilemma and making it look like he is erring on the side of caution.
Smells of a future rip off !!
Think we should just cut our losses and get out of the bailout. Can’t really put a price on full sovereignty, even if it means harsh cuts in next year’s budget
Full sovereignty is not a possibility. Have you forgotten the Fiscal Compact Treaty? We, as a nation, have signed up for EU oversight of all our budgets for the foreseeable future.
Michael Noonan is a bog monster.
Tear it up.
have your say