Opposition condemns use of pension fund in €85bn bailout
THE €85 billion EU-IMF bailout package for Ireland announced last night was roundly condemned by the Opposition parties who are now all likely to vote against the Budget on December 7th.
Fine Gael, Labour and Sinn Féin attacked the intention to use the National Pension Reserve Fund to help provide a further €10 billion in further capital for the banks. In total, the banks could end up getting another €35 billion if their losses are bigger than expected.
Under the agreement the State will contribute €17.5 billion of the package from the National Pension Reserve Fund and cash held by the National Treasury Management Agency while the total external assistance in the fund will come to €67.5 billion. It is comprised of €45 billion from the EU, bilateral loans from Britain, Sweden and Denmark, and €22.5 billion from the IMF.
Fine Gael finance spokesman Michael Noonan said the deal was “a hugely disappointing result for the country” and he said it was hard to imagine how it could have been much worse.
“The Government was cleaned out in the negotiations and has not acted in the best interests of Ireland. At the very least we could have expected a low rate of interest on the loans, EU agreement on a jobs and growth package, and agreement to share the cost of rescuing the banks with the bondholders.
Good to see the opposition showing some backbone at last, but pity it’s over the use of the pension reserve fund. IMO it makes perfect sense not just that the EU and IMF would insist on us spending our savings first, but also that the money from the NPRF will be cheaper than the bailout money. However, they also criticise the rate which has, unsurprisingly, been “negotiated” down to 5.8% from the 6.7% that somehow got reported by RTE.
we wanted to spend that money!”
That money was earmarked for the “stimulus” package.
This is the bit I can’t get my head around. Pat Rabbitte was enraged about the spending it on deal because he had planned to spend it on a “stimulus”.
But Pat - how did you plan to pay to keep the lights on?
did anyone seriously think we would be allowed to keep our Sovereign Wealth Fund and get a bailout at the same time?