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ECB letters should be used to strengthen Ireland’s hand - Tóibín

6 November, 2014

Reacting to publication of the ECB letters Sinn Féin TD Peadar Tóibín said the Government must use the letters to strengthen Ireland’s hand in reducing the states debt burden.

The Meath West TD said:

“While the ECB have made it clear that the decision to enter into the austerity programme was a decision of the Fianna Fáil government it does illustrate the aggressive ECB approach to Ireland’s financial woes. 

“The content of these letters should be used now to strengthen Ireland’s hand in arguing for a retrospective recapitalisation of the pillar banks. This Government like the last has allowed itself to be bullied by the ECB and it is the citizens who have picked up the tab. 

“Since Tuesday the ESM has been open for an application for the retrospective recapitalisation of banks. Despite the fanfare two years ago when this possibility was announced the government has failed to take advantage and is now frantically backtracking.

“There are in total €25bn of bonds linked to Anglo Irish currently with the Central Bank. This is a toxic debt and a weight on the balance sheet as it is added to our government debt. The ECB is understood to be pressurising the Central Bank to sell these bonds onto the market as soon as possible.  These bonds should be torn up or at least held by the Central Bank so that the cost is in effect circular and returns to the exchequer through Central Bank profits.

“Fianna Fail made the wrong decisions but the aggressive attitude of the ECB as revealed in these letters should now be used now to undo the damage.”

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