Mary Lou McDonald (Dublin Central, Sinn Fein)

The Government also claims that this is the final deal and the final figure. It makes much of the robust stress tests carried out but what the Government does not say is that, for instance, on one of the key indicators of that stress test - the level of unemployment - we are just a shade off the worst case scenario as envisaged. I hope this is the final tab and I hope these are the final figures. However, we sound a note of caution because we have been here before. We have been told before that there would be no more billions required, yet the reality was far from that.

The Government claims consolidating the banking sector - a move which is widely acknowledged as being necessary and long overdue, and in dividing out core from non-core elements - will result in an end to the domestic credit crunch and will cause credit to flow to families and to business. At best, the jury is out on this. If the Government were truthful, I think it would concede that only time will tell whether this happens. I remind the House that on this score we have been here before. We had endless statements and assertions from the previous Administration that the actions it had taken in propping up the banks would result in credit flows but that did not happen.

The Government claims that it has now guaranteed liquidity from the ECB for the banks. However, what it will not address is its failure to secure that liquidity flow on a medium or long term basis. That money is still given on a short term basis. Earlier the Minister for Finance, Deputy Noonan, recited all the positive commentary, as he saw it, from the international community in respect of the Government's measures. He studiously avoided saying that this failure to achieve that medium term facility from the ECB has caused at least anxiety on the international market. It is a case of business as usual in terms of burden sharing because it is not going to happen, or so the Government says and particularly in respect of the €36 billion of unguaranteed debt. The reason it will not happen, we are told, is because Europe simply will not countenance it.

In the course of this debate and others, there has been a very crude depiction of the concept of burden sharing and the demands made around it, this at a time when the mechanisms to achieve fair and balanced burden sharing are not only long established but are also entirely economically rational and reasonable. This is so much so that even the EU in the new economic stability mechanism, the new permanent bail-out facility, explicitly recognises that there will be burden sharing and default. The EU is not so frightened of the term as some on the Government benches. The EU set out the benchmarks, the measures, that would be used to guide such default, which are, proportionality, transparency and fairness. Those are as good criteria as any that might be used.

This State now finds itself in a position where the European authorities with, if not the connivance of the Government then certainly its agreement, will not, we are told, give us a hearing in respect of a restructuring of private bank debt. However, they tell us from the other side of their mouths that come 2013, they will ably assist us in the course of perhaps a sovereign default. That is how this is shaping up. Rather than discounting people's legitimate and well-grounded worries that our burden of debt is now at the point of unsustainability, the Government benches would be better placed to act in the national interest and to put that demand and argument front and centre in our dealings with the European authorities and partners.

In this respect I note that the humble Deputy Durkan is no longer in the Chamber but I am struck by his almost evangelical appeals to all of us. He tells us that no one in Europe likes us any more. Perhaps he expected winces of disappointment from the Opposition. I remind Government Deputies that this is not a case of who is the most popular kid in the class at EU level but rather this is a matter of defending national interests. When it comes to the heads of European institutions, be it Barroso or Trichet and when it comes to defending the interests of member states, be it Mr. Sarkozy or Angela Merkel, they all operate on the entirely rational basis of protecting their interests. Therein lies the explanation for the resistance to a rational, organised sharing of the burden of bank debt which would have an implication for the core European countries. They dismiss that while on the other hand, with the agreement of our Government, they set up the very apparatus which can in time facilitate sovereign default, which is a much more serious scenario for all of us.

In the course of this debate Government voices asserted - as if we did not know already - that there is now an indivisibility between the banks and the State, between banking debt and State debt. People on the street know this. This is the reason the situation is so serious. The Minister for Finance, Deputy Noonan, can make the argument that the bond yields have now slipped below 10%. He set this out to the House as a piece of good news. The bond yields are hovering above 9% and this means the markets know full well, as rational, hard-nosed entities, that this State cannot sustain the burden of debt we have continually taken on. The people on the street also know it.

The Government has played its card that it inherited this situation, which I acknowledge. However, it is now in charge and it must make the decisions. It had the chance to shift gear, to change direction-----

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