Belfast Telegraph

Sinn Fein criticises debt deal

The Government has been accused of accountancy trickery in a bid to fool the public into believing a deal on old Anglo debts is good for the country.

As Finance Minister Michael Noonan said the source of low-cost funding for Ireland would be key to further negotiations on the 27 billion euro left owed by the toxic lender, Sinn Fein said deferring repayments solves nothing.

Outside a summit in Copenhagen, the minister said talks would continue to secure lower rates on the remaining debt run up at the bank, now known as the Irish Bank Resolution Corporation (IBRC). He also suggested access to emergency eurozone bailout funds would be key to any successful negotiations on Anglo.

"The European Central Bank would favour that because it would improve their collateral significantly," said Mr Noonan. "But that would be of little use to Ireland unless we got the commitment to ongoing medium term low-cost funding from the European Central Bank."

However, Sinn Fein finance spokesman Pearse Doherty attacked the Anglo debt deferral deal announced on Thursday.

He said arranging a new long-term government bond instead of paying off the 3.1 billion euro promissory note, or IOU, would fail to reduce Ireland's debt, deficit and liability to the former toxic bank.

"Not only has the minister abjectly failed to seek a restructuring of the promissory notes, but that even the movement it claimed to have achieved is a jumbled up mess of accountancy trickery and additional costs, with some crossed fingers thrown in," said Mr Doherty.

Mr Noonan unveiled plans to defer the IOU payment to the IBRC with a bond. The promissory note - or promise to pay - was due on Saturday but the new deal enables Ireland to spread out its debt repayments. Ireland ultimately pays more on interest rates but repayments will be less burdensome.

Mr Noonan also said it removed the need for the Government to dip into its 85 billion euro bailout fund and pay cash but rather use a complex debt reschedule and money transfer.

Mr Doherty criticised this arrangement, saying: "We now have the bizarre situation where the Bank of Ireland will be looking to sell this bond back to IBRC next year, so this arrangement is not even pushing the debt out to the distant future, it is just deferring it for one year."


From Belfast Telegraph