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Noonan has ‘totally surrendered’ on bank recapitalisation - Matt Carthy MEP

10 May, 2016 - by Matt Carthy MEP

Finance Minister Michael Noonan has confirmed the Irish government’s total surrender to the EU institutions on the question of retrospective recapitalisation of Ireland’s pillar banks, Sinn Féin MEP Matt Carthy said today.

Carthy, a member of the European Parliament’s Economic and Social Affairs Committee, said:

“At this week’s Eurogroup meeting in Brussels, Michael Noonan officially confirmed that the Irish government was no longer seeking the direct recapitalisation of AIB or Bank of Ireland through the European Stability Mechanism (ESM) fund.

“The former Fine Gael/Labour government missed a vital opportunity to relieve the debt burden from the backs of the Irish people. The incoming government has confirmed it will not put up a fight for the interests of the Irish people on debt but will opt instead for the re-privatisation of the banks.

“With less than one per cent of the EU’s population, the Irish state paid more than 40% of the cost of the financial crisis in Europe. Since the 2012 EU agreement to break the link between banking and sovereign debt, it has been clear that the Irish government had a very strong case for debt relief through recapitalisation by the ESM – but our government representatives lacked the backbone to even make the demand, let alone secure a positive outcome.

“Noonan claims that ‘the issues have moved on’, but the reality is that the Irish people remain saddled with this debt for decades to come and continue to suffer the effects of almost eight years of austerity. Our debt servicing costs are around €6 billion and the debt to GDP ratio is still around 94%."

Carthy continued: “Instead of securing a deal on bank debt, the government has opted instead for one of the biggest banking flotations in Europe since the crisis, rushing to sell shares in Bank of Ireland, Permanent TSB and soon AIB in an attempt to gain back some of the costs of the bailout.

“There has been no detailed analysis carried out as to the true value of AIB and whether now is the optimal time to sell shares to get the best return for taxpayers. The sell-off of bank shares will also reduce the ability for the public to have a say in banking policy through their elected representatives, particularly when it comes to mortgage lending and foreclosures.

“Despite its criticisms of Fine Gael’s banking policy while in opposition, Fianna Fail now appears to have accepted this approach.

“Sinn Féin will continue to stand up for the rights of the Irish people when it comes to debt relief and banking policy.” ENDS

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