Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

I will, I ... I'll go through that. The first thing was that it ... I think it was your second witness this morning said that many of the things were decisions for the finance Ministers and on the political side rather than from the Commission. And, you know, when the interest rates were designed for programme countries, Ireland being second up, in their wisdom, some of the Ministers from the creditor countries decided that if they didn't punish us, they'd do it again ... we'd do it again. And the punishment was referred to as "moral hazard", and to avoid moral hazard they were sticking a premium on to the interest rates to make sure, like, that we didn't enjoy it so much that we'd do it a second time. So I pointed out to them that people who lose their jobs and get their pay cut by 20% were unlikely to sin again and we didn't really need the margin to ... to teach us manners. So there was a lot of debate going on, but that was the first obstacle ... was to get over the moral hazard argument that some of the creditor countries, particularly the smaller creditor countries, were very hot on. Once we got over that, then, we ... we ... we began to move.

The second obstacle was that there's a kind of a protocol - I don't think as a matter of law, but it is precedent and practice in Europe - that any concession you give to one country, you give it to other countries. So, like, if ... if we got a concession, 'twould have to apply to Greece and 'twould have to apply to Portugal and subsequently to Cyprus and Spain and so on. So, you were never arguing on your own. After a while then, we began to get allies and, as I said earlier, people thought we were hard done by on other issues and we got a ... a lengthening of maturities and a reduction of interest rates.

And there was still a margin but it was a substantial reduction.