The expected announcement this weekend of a postponement of the €3.06 billion payment due on March 31 under the IBRC promissory note arrangement must be used as a catalyst for concluding an overall deal that reduces Ireland’s banking debt, according to Fianna Fáil Finance Spokesperson Michael McGrath.
Deputy McGrath, who raised the issue with Minister Noonan in a Topical Issues debate in the Dáil yesterday, stated, “The expected deferral this weekend of the €3.06 billion payment due on March 31st would be a welcome first step. However, this interim arrangement must be built upon immediately by securing an overall deal that reduces the burden of banking debt facing the State.
“As well as teasing out the 2012 arrangement, I will be raising the issue of the shape of the overall deal with the Governor of the Central Bank Patrick Honohan when he appears before the Joint Oireachtas Finance committee next Tuesday.
“Minister Noonan confirmed to me in the Dáil yesterday that the nature of the arrangement being put in place to postpone the 2012 payment is not the template for the overall deal. I expect that the Government is seeking to secure an actual reduction in the burden of the banking debt rather than merely postponing payment some years into the future.
“The ECB and our European partners know that Ireland represents the best prospect of success among the three countries in an EU / IMF Programme of Assistance. They must also recognise that Ireland’s debt sustainability will be greatly enhanced by agreeing to an overall deal on our banking debt. This will also improve our chances of returning to the international bond markets in a meaningful way in 2013.”