I MET THE TROIKA earlier today. Before the meeting, I asked (via TheJournal.ie and Facebook) what questions people would like put to them. Over 200 replied.
With seven TDs and one hour, I had eight minutes to put my questions, so I tried to cover the most common themes raised.
One of them mentioned to me, during introductions, that he’d been watching the responses on TheJournal.ie with interest. So, even if your question isn’t covered here, rest assured that, at the very least, it’s been seen directly by the Men In Charge. Sadly, the mission chief for the ECB was not present. This was frustrating, as he was the person I wanted to engage with most.
Here’s my synopsis of the questions and answers, asked by you (via me) and by other members of the Technical Group.
- What’s below is a summary based on my hastily written notes, and as such will not be perfectly accurate, and is entirely are open to challenge (I went straight from the Troika to a meeting with David Hall and others on the constitutional challenge to the Promissory Notes, so I’m doing my best on accuracy with a brain that’s pretty stretched for a Friday evening!);
- I am intentionally keeping comments non-attributable to individuals.
Q: Do the banks have enough money to deal with distressed mortgages?
A: The three main banks, AIB, BoI and PTSB, have €26 billion between them for this. That’s more than enough. Having these mortgages dealt with is important to the national recovery.
The markets should respond well for two reasons. First, it would reduce the number of people who are financially distressed, thus increasing domestic demand. Second, it would remove uncertainty as to the level of bad debt on the banks’ books. Too few solutions to date have been durable, with too much reliance on short term fixes such as interest-only periods.
Q: What does the Trichet letter to Brian Lenihan say? Can we have a copy?
A: We haven’t seen any such letter which insists Ireland bail out the banks. As to getting access, the ECB is governed by rules as to what it can release.
[Author’s comment: Gavin Sheridan of TheStory.ie has tried to get the letter, but both the ECB and the European Ombudsman are telling him it doesn’t exist.]
Q: Did the Troika have anything to do with the closure of Garda stations, as claimed by Minister Shatter last night?
Q: Why is competitiveness not being more thoroughly addressed?
A: The issue is hugely important, and Ireland’s lack of competitiveness in certain areas contributes to high prices for the public.
A big impediment is that anti-competitive behaviour can only be addressed as a criminal activity. This requires too high a burden of proof. You need to be able to take civil actions, as in many other countries, which are easier and quicker to process.
Q: What’s your justification for the property tax?
A: It’s the Irish Government’s decision. However, we agree with broadening the tax base and we actually recommended a higher level of tax for it, as it’s a progressive tax.
[Author’s comment: This is a very short account of what turned out to be a rather frank exchange of views between one of the TDs present and several members of the Troika.]
Q: How are you keeping yourselves aware of the austerity being felt in Ireland?
A: We are very aware of the impact of austerity on the Irish people. We track household income, and reference it in the report.
[Author’s comment: They are also aware of various other indicators, such as the ‘What’s Left Tracker’.]
Q: Have you recommended to the Government that budgets and other correction measures should be progressive, rather than the regressive ones of this Government?
A: We are aware of the ESRI report, and its finding that overall, the correction measures are probably regressive. It is worth noting that compared to correction programmes in other countries, Ireland’s is less regressive than many.
We do engage with civil society groups, and get regular input from them on the impacts of the programme measures.
Q: What would happen if Ireland didn’t pay the €3.1bn on 31st March?
A: No comment, no comment, that would be a serious decision.
[Author’s comment: They didn’t actually say ‘No comment’, but I thought I’d skip over the boiler-plate responses that meant the same thing.]
Q: Is it reasonable that Ireland, which has, according to the EC’s own analysis, contributed 42% to the total cost of the Eurozone bank bailout, should borrow from Europe at seven times the cost Greece will now get to borrow?
A: No comment, no comment, no comment. [Author’s comment: as above.]
Stephen Donnelly is an independent TD representing Wicklow and East Carlow.