Belfast Telegraph

EU deal 'will ease taxpayer burden'

Taoiseach Enda Kenny has said an EU agreement to bring down borrowing costs for indebted nations will ease the burden on Ireland's taxpayers.

European leaders threw a lifeline to Spain by agreeing that its failing banks should have direct access to EU bail-out funds without adding to its government's debts.

Mr Kenny described the deal, struck in the early hours of the morning, as a seismic shift in European policy that would allow Ireland to re-engineer its overall debt level.

"What was deemed to be unachievable has now become a reality and that principle has been established and decided and agreed upon by the council, by the heads of government," he said in Brussels.

"But for us the more immediate impact is that Ireland is named as getting equal treatment as other countries with difficulties here.

"That means that heads of government's decision will now be referred to the eurogroup [of eurozone finance ministers] for an analysis of how best this might be used in Ireland's case to re-engineer the debt burden that is on our taxpayer, which is what we set out to do."

Mr Kenny said the new deal means Ireland's overall debt burden, including the bank debt, can be re-engineered in a way to give Ireland equal treatment to Spain and any other countries which avail of the new system.

The agreement by the leaders of the 17 eurozone nations came after German chancellor Angela Merkel appeared finally to relent in the face of concerted pressure. Spanish prime minister Mariano Rajoy and Italy's Mario Monti made clear they would block further progress at the summit unless they received assistance to curb their soaring borrowing costs.

Crucially, they appeared to have been backed by French president Francois Hollande, attending his first EU summit, who has said tough austerity measures to cut deficits must be backed by support for growth.

Tanaiste Eamon Gilmore described the deal as a massive breakthrough for Ireland which breaks the link between the crippling bank debt and the State: "This really changes the game for us as far as bank debt is concerned. It will enable this country to recover much faster than was the case up to now."


From Belfast Telegraph