Brian Lenihan Jnr (Dublin West, Fianna Fail)

We must be precise in our terminology. Under this agreement, the Commission and the authorities envisage we will have an orderly restructuring of subordinated debt, but not unguaranteed senior debt or sovereign debt.

Clearly, the comments of the German Chancellor in relation to sovereign debt, which have now been clarified, were not of assistance during the crisis to date.

As regards Deputy Creighton's call for a stimulus package, we are going to have to recognise that borrowing, in the order of 11.75% this year and 9% next year, is a very substantial stimulus, which we will have to refund through debt repayments in the future. It is not a stimulus in the banking system. Some €50 billion of the €67.5 billion borrowing involved is a direct stimulus to ensure the State continues to spend on the current and capital side. We have to face up to that basic economic fact.

Deputy Terence Flanagan asked about an external review. There was no external review prior to the conclusion of the agreement. However, in the preliminary discussions that took place between Governor Honohan and the Regulator with the ECB and the IMF, no evidence was produced to the effect that their assessment of the September announcement was inaccurate or that there were fundamental defects in it.

I have just stated that there was no external review. There was an external review, but it was not a formalised external review, so I just want to clarify that.

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