The chairwoman of a powerful
European Parliament
committee has backed
the State’s claim for retrospective euro zone compensation for the bank bailout.
British MEP Sharon Bowles said "all possibilities for relief should be explored" as economic recovery in Europe picks up, including direct bank rescues by the European Stability Mechanism (ESM) bailout fund.
“The Irish taxpayer took on the extra debt for the benefit of the rest of the EU, and this has subsequently been shown to be the wrong call,” she said in a statement.
Ms Bowles was not herself present during a two-day visit to Dublin by members of the economic and monetary affairs committee, who are examining the performance of the EU-IMF troika in Ireland and other bailout countries. They believe the operations of the troika should be subject to democratic oversight by bodies such as the European Parliament.
The committee members met Central Bank governor Patrick Honohan yesterday after talks on Thursday with Minister for Finance Michael Noonan and Minister for Public Expenditure Brendan Howlin. They also met social justice campaigners, economists, business interests and trade unionists.
'Back-seat driver'
Finnish MEP Nils Torvalds said it appeared that the European Central Bank had operated like a "back-seat driver" within the troika. "That's always a fairly bad decision or a bad combination, so you were trying to go in different directions but through the troika you can just go with one," he told reporters at a briefing last night in Dublin.
He was also concerned about one-size-fits-all troika policies, which hit the “substructures” of society very hard.
Fine Gael MEP Gay Mitchell said the biggest question from Ireland's perspective was whether the committee's final report would make a recommendation for special relief in light of the banking debt, which is now part of the national debt.
Mr Torvalds said no such promise could be made at this point as the committee was looking at all bailout countries. “If I would now signal that yes we’re going to help the Irish, then I would probably be lying,” he said.
Mr Torvalds said he was sceptical of claims that the troika simply did Germany's bidding. Referring to the German chancellor, he said: "Mrs Merkel is always painted like the evil hag in the background. I think that's a cheap way of describing the situation. That doesn't mean that I would agree with what the Germans now do."
