A number of senior Government Ministers have said that last week’s deal on the promissory notes will have a tangible impact on the State’s efforts to restore fiscal independence to Ireland.
Minister for Jobs Richard Bruton and Minister for Transport Leo Varadkar, in separate interviews, said the deal would leave the Government in a much stronger position in its attempts to reduce the Government deficit to 3 per cent by 2015.
Troika view
However, Mr Varadkar conceded that while the adjustments might be €1 billion less, the Government would still need to get the agreement of the troika of international lenders on any decision it might take on foot of the savings.
Separately, Minister for Public Expenditure Brendan Howlin gave a reassurance that the Government would seek no further concessions from public sector workers if agreement was reached with their unions on “Croke Park II”. The talks are aimed at securing a further €1 billion saving in the public sector pay purse. Mr Howlin said: “There will be no further asks of public sector servants, unless some calamity happens outside our control.”
Meanwhile, Central Bank governor Patrick Honohan gave an assurance that the agreement reached to convert the promissory note into bonds would not unravel.
Speaking to RTÉ, Prof Honohan said the agreement would not unravel because it set out a minimum schedule and the criteria on which the arrangement would be delivered.
More sustainable
Asked if he now regarded the Irish national debt as sustainable, Prof Honohan said the debt and its path were a lot more sustainable than they had been before.
“There are always risks,’’ he added. “We have published many papers in the Central Bank showing the scale of the risks.” The European Central Bank (ECB) would continue to monitor the promissory note deal, he said.
The Central Bank had undertaken to sell the bonds as soon as possible, subject to financial stability conditions. “And that has to be monitored continuously over the next 25, 30 years,’’ he added.
‘Careless leak’
Prof Honohan said he had no idea where the leaks relating to the deal had come from. It was quite possible, he said, it was a careless leak because, as time went on, a widening group of people knew about it. He was told reliably, he said, that it had happened outside of Ireland.
He denied a report that he had been rebuked by Taoiseach Enda Kenny and Ministers on Wednesday night for failing to complete a deal. He said everybody was “concerned, tense and anxious’’ to get the deal done quickly.
