Mr. Sebastian Barnes:

There are two factors with interest rates. There is the risk spread associated with Irish debt specifically and then there is the euro area risk-free interest rate. If we continue to manage our public finances properly, there is no reason why the spread should not remain quite low, although there are risks. We have seen tensions in the euro area as interest rates have increased, in particular as regards countries with relatively high debt. As Mr. Timoney said, it is very hard to know what will happen in terms of interest rates. There is a general view among economists that interest rates will ultimately rise from where they are today, but that they probably will not go back to the same sort of rates we saw in the past. There has been a trend of declining interest rates over time. As he also said, in the Irish case, something that gives us some protection in the short term is the fact that we have locked in low interest rates for much of our debt for many years ahead. The fact that we borrowed to build up cash reserves means we have had to borrow more. This means we have got a stock of low-interest debt. In an environment where money is likely to be quite tight because of all the pressures on spending, this is one extra thing that will not help but it should not be a decisive factor. In the long run, the higher debt you have, the more exposed you are, and it will come in a bit more.