Funding stream for running of State will need to be secured by early 2013 – McGrath

The explicit reassurances by the Taoiseach and Minister for Finance last week that Ireland is fully funded ‘in all circumstances’ until the end of 2013 and into 2014 are not supported by the facts in the public domain, according to Fianna Fáil Spokesperson on Public Expenditure and Financial Sector Reform Michael McGrath TD.
 
In light of comments made by Minister Leo Varadkar to The Sunday Times, Michael Noonan last week said: ‘The programme is due to run until the end of 2013 and the start of 2014 and there is sufficient money in the programme to meet all eventualities.’
 
Taoiseach Enda Kenny said: ‘The country was meeting the conditions at the first review of the current bailout which is due to end in 2013 and the country had sufficient funds in all circumstances.’
 
Speaking today following Finance oral questions in the Dáil, Deputy McGrath said: ‘Minister Noonan has now rowed back somewhat on last week’s statements and is now saying that the State is funded ‘into the second half of 2013’. It is clear the government cannot categorically state that Ireland is fully funded through to the beginning of 2014.
 
‘On the basis of the facts available, I believe that, by early 2013, Ireland will need to have prudently secured a stream of funding for the running of the State. I support the government’s objective that Ireland returns to the international bond markets to meet our funding requirements as soon as possible but the government needs to come clean and acknowledge that we will need to know where we stand early in 2013,’ stated Deputy McGrath.
 
In support of his analysis, Deputy McGrath pointed out that the European Commission’s review of Ireland’s EU / IMF Programme published in May states that Ireland will need €14 billion of funding from the markets in 2013 to reach the end of that year (see page 22 of the report on the attached link http://ec.europa.eu/economy_finance/publications/occasional_paper/2011/pdf/ocp78_en.pdf) The IMF and private sector analysts have also confirmed that Ireland will need to raise significant funds from the market in 2013.
 
In addition, Deputy McGrath pointed out that a bond of almost €12 billion matures on 15 January 2014 and will have to be refinanced (http://www.ntma.ie/GovernmentBonds/Daily_Bonds_Outstanding.pdf  )
 
Deputy McGrath said ‘The efforts by the Government to clear up confusion about the funding of the State have regrettably led to further uncertainty.  
 
‘It seems clear that the State will, contrary to the assurances from the Taoiseach and Minister for Finance last week, require additional funding by the mid-point of 2013 at the latest.
 
‘We need absolute clarity on this issue. The facts simply not bear out the assertion from Taoiseach Kenny and Minister Noonan that Ireland is funded through to the beginning of 2014.’