Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)

The conditionalities. Yes, but wait until the Minister feels the effects. He should look at what the IMF did to other countries.

Joseph Stiglitz, the Nobel prize-winning economist who worked closely with the IMF for ten years until he became a whistleblower on the reality of the IMF, was damning in his description of the IMF. He said:

When the IMF arrives in a country, they are interested in only one thing: how do we make sure the banks and financial institutions are paid. It is the IMF that keeps the financial speculators in business. They are not interested in development or what helps to get a country out of poverty.

This is the view of an insider who knows and whose economic credentials are unquestioned. This is who we are huddling up to and for whom we are doing favours. This is the body we are helping to re-legitimise in order to get a few crumbs off its table. I warn the Minister however cute he may imagine he is being, in the nod and a wink politics of doing it a little favour and it will do us a favour in return, the IMF is playing him. It is playing him like it has played every other country in which it has ever intervened. As Joseph Stiglitz said, all it is interested in is giving the money back to the banks and the financial institutions and the speculators and it does not care about poverty, economic recovery or anything else. The IMF has admitted to these motives.

Jobs is one of the most important issues facing this country. I ask what is the IMF attitude towards job creation. I refer to the IMF website where it is stated that the IMF admits that its support to countries is not structured with the centrality of jobs in mind. That is for sure. In fact, what the IMF demands of countries is the massacre of jobs in the public sector. The IMF programme has a policy to keep slashing jobs.

On the question of who benefits, I will draw the attention of the Minister to recent replies to parliamentary questions. They provide some indication of who benefits from the massacre of jobs in the public sector. I have not received all the replies from Departments as most of them are stonewalling me about supplying detailed answers. The replies provide all the narrative of attacking the public sector which is being reinforced by the IMF. It is the policy to make savings by axing public sector jobs. An audit of this practice is required across the board. One small State agency under the Minister's auspices, the National Sports Council, has eight agency staff employed through employment agencies, Orange, Hays and Calix. Six of those staff cost €264,000 a year. If those were directly employed, those staff would cost €203,000, a difference of €51,000. This is the cost of outsourcing to a private agency, Orange. This difference of €51,000 is profit for those employment agencies paid for from public moneys. Another worker could be employed for that amount or a saving could be made. The Hays agency earned €76,000 for the provision of one staff member and if that individual were to be employed directly it would cost the State €51,000. Calix provides one employee at a cost of €83,000 and if employed directly this employee would cost the State €51,000. If this is repeated across the public sector, local authorities and State agencies, it amounts to a loss to the Exchequer, apart from anything else, of millions and millions of euro. It could be tens of millions of euro or possibly hundreds of millions of euro.

My own local authority, Dún Laoghaire-Rathdown, has a budget of €220 million and €140 million was spent on outsourcing to private contractors. I could not get any answers as to how much was being paid to private contractors and whether it was value for money. The private contractors, the consultants, benefit. This is what the IMF forces on us. We are told to do away with decent and secure jobs, well-paid jobs and jobs that are good value for money for the public and to replace them with agency staff who have fewer rights but the private operator makes a nice fat profit.

Will we do anything about this? We will probably do nothing because the IMF's ideological position is that we must privatise and cut jobs, which is what it demands in its stability programme.

The other thing about the IMF that should worry us is just how bad it is at predicting the impact of its own economic and structural adjustments - the so-called programmes. It admits on its website that it fails to predict growth in economies, confirming that its "GDP growth forecasts showed a tendency to systematically exceed outcomes." "This phenomenon", it noted, "was particularly prevalent in countries with an IMF-supported program." It is important to note this failure when considering our prospects as we reel under the impact of IMF austerity, cutbacks, privatisations and the sale of State assets. If there is any justification for these measures, it must be that somehow - magically - they will produce economic growth. The IMF admits, however, that it has been proven wrong in all countries where it has imposed its programmes telling them they may feel a little pain for a while but will eventually recover. Its programmes have not produced growth and employment but the opposite, namely, stagnation and recession. The banks and corporations which were moving in on the state assets and natural resources of the countries in question got their money, however. That is the real agenda of the IMF.

While the Minister may not be remotely interested in my next point, it may be of some interest to members of the public. The reason the IMF was under pressure to make changes and the reason organisations such as Oxfam commented on the role of the institution was that by the end of the 1990s people had grown sick and tired of what it was doing to the world. This led to massive protests in Seattle, Genoa, Prague and elsewhere which became known as the anti-globalisation movement. The protests rounded on the IMF and World Bank for the way they had ravaged countries with their neoliberal wrecking doctrine which had caused massive poverty, major increases in child mortality, the destruction of infrastructure and the rape of the assets and natural resources of developing countries. Such was the scale of the anti-globalisation movement, which reached its high point when millions of people - peasant groups, community groups, trade unions and others - took to the streets of cities around the world to say the IMF had wrecked their societies, caused immense poverty and accelerated growth in the gap between rich and poor, that the institution found itself in serious trouble and its future in question. As a result, it was forced to start to make what appeared to be concessions but which were simply efforts to bolster the real character of the institution. As we know, the true nature of the IMF and World Bank is to act as the bootboys of global capitalism. They are modelled on a corporate structure in which those who have money call the shots. We should not be taken in for a moment by the suggestion that we will somehow gain something out of the IMF-ECB programme. By saddling us with the debts of bondholders, the IMF and ECB will cripple growth and the economy. The programme will be used as an excuse to ram down our throats the neoliberal dogma that has wrecked Africa and Asia and done extreme damage to Latin America.

When the Government develops its policy of essentially sucking up to the ECB, IMF and other institutions I wonder if it has any sense of history or knows anything about what the IMF has done elsewhere in the world. Does it listen to experts such as Joseph Stiglitz or Paul Krugman? Who does it listen to and from whom does it take advice on how to deal with these matters? I was given a little insight in this regard yesterday in a response to a parliamentary question I had submitted to the Department of Finance. This shocking information I received may or may not be in the public domain. The reply stated that in 2010 the National Treasury Management Agency paid out €6.2 million to the Rothschild Group for advice on how to deal with the banking crisis. While the payment was made under the Fianna Fáil-Green Party Government, I ask the Minister if he will indicate whether the Department continues to take advice from this company and if the Government was taking advice from it at the time of the bank guarantee. Notwithstanding how the Minister may answer those questions, the Department was taking advice from the Rothschild Group at the end of 2010 when we were deciding whether to sign up to the EU-IMF programme.

Rothschild is a bond trading company which represents the global super-rich, the multimillionaires and multibillionaires who hold our bonds. Let us get this straight. The Department, under the Minister's predecessor, paid €6.2 million to ask the representatives of the bondholders if we should repay their clients. Not surprisingly, the Rothschild Group advised that the bondholders should be repaid. The decision to follow its advice has sunk the country. While the Minister has become more muted on this issue, at the time he was critical of the decision to repay the bondholders, describing it as morally wrong and economically unsustainable to ransom the country to protect the interests of bankers and bondholders. He made a statement to this effect in February of this year. Given that bondholders would benefit from the advice that we should sacrifice the economy and impose brutal austerity on citizens, one would expect Rothschild to offer it free of charge. Instead, it charged us €6.2 million for doing so, which is amazing. Talk about golden circles; not only do such circles operate at the crony level of this country but we are now linked into the golden circles of the IMF, the Rothschild Group and bondholders, with the ECB dictating policy. It beggars belief that this company is advising us.

Rather than trying to prop up a vulture institution such as the IMF or give it any legitimacy, we should tell it and the bondholders to get lost. We should address our problems rather than become the victims of what are essentially drug pushers who are pressing us to take on the debt and austerity that will cripple our society and economy. This is what the IMF has done everywhere else.

I make the following point due to sheer frustration. At a recent meeting of the Joint Committee on Finance, Public Expenditure and Reform I asked members of the Fiscal Advisory Council, which monitors the Government's macroeconomic policy, about the council's growth projections. Irish growth projections have been already been downgraded and, as I noted, the IMF admits it always gets its projections wrong. Various reports, experts, media articles and so on which projected a return to growth in 2012 or 2013 have subsequently been revised as the authors realised closer to the relevant time that we would not achieve growth. In light of the downgrading of Ireland's projected rate of growth for next year, I pointed out to the Fiscal Advisory Council that its charts showing an upward curve from 2013 onwards indicate that it predicts austerity will produce growth from 2013 onwards.

They have also admitted that their initial growth projection for 2012 was wrong. They are continuing to say there will be increased growth in 2013 and 2014. I asked them to outline the evidence that those growth projections are accurate in any way. They could not answer. Their projections are collations of the growth projections of the IMF, the Central Bank and the ECB etc. Where is the evidence for what they are all projecting? In some cases, they are projecting on the basis of each other's projections. When an organisation learns of the IMF's projection, it amends its own growth projection by a couple of points. When I sought hard evidence and mentioned the concrete evidence before us that austerity is crippling the economy and strangling growth, I was eventually told that historical models form the basis for the growth projections. That is alarming.

What historical models are being used? Is consideration being given to the history of the IMF everywhere it has gone? I suggest we would be better off to look at the historical model of what happened in the 1920s and 1930s, when there was a crisis of the same sort. The same policies of austerity were imposed and the result was the Great Depression. That is where we are heading now. The IMF is leading us down the track towards a depression. We should tell it to get stuffed.

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