Ms Eilis Ryan:

I will take Senator Mullins's question in regard to the UN sovereign debt restructuring mechanism. In an ideal world, there would not be recurring debt crises. As long as such crises remain the reality, however, we need some way of dealing with them when they happen. It is useful to compare this requirement with the need for personal insolvency legislation, which has become increasingly important in this country in recent years. As long as we are in a situation where people are facing crises in terms of repaying debts, it is critical that we have in place a rules-based mechanism detailing how creditors are obliged to engage with those people.

In terms of what a debt restructuring mechanism would look like, the first thing we would like to see is that it be located within an independent body and, in particular, that it be independent of creditors. The IMF, for example, is a significant creditor to developing countries and, as such, it is not appropriate for any mechanism to be located within that body. As Mr. McCaughey said, notwithstanding the concerns people have about the UN, our view is that it is the only legitimate place within which to locate a debt restructuring mechanism. Locating it within the IMF would be similar to locating a personal insolvency mechanism within one of the private banks. There is a conflicted interest in both instances.

The second thing we would like to see is that it would be mandatory for all creditors to engage with the new mechanism. We are hearing a lot in Ireland about vulture funds and the negative role they are playing. Where a developing country gets into debt difficulties - we saw Argentina in that situation recently - 85% to 95% of creditors might be on board with restructuring debt, but if 2% or 3% of them are vulture funds, they may hold out and refuse to do a deal. Taking that stance is sufficient to renew the country's debt crisis.

In terms of the support that exists for a debt restructuring mechanism, the proposal put through the General Assembly of the UN for such a body received overwhelming support, with 124 countries out of 176 supporting it. That is reflected in the support for the proposal in the financing for development negotiations. Unfortunately, however, no European country supported the proposal and there is a continuing failure to engage with the negotiations on it. There is a clear division, in short, between European and other wealthy countries, on the one hand, and the rest of the world, on the other hand, on this issue. We have heard from the Government that some of this is down to failed diplomacy between different countries. Our view is that if those concerns are real, they should nevertheless not be used as an obstacle to progress. We should not bite off our nose to spite our face. It would be good to move past those concerns and agree that the UN is the place within which a debt structuring mechanism should be located.