Arthur Spring (Kerry North-West Limerick, Labour)

The purpose of the Bill is to provide further financial stability in the interest of the public, the European Union and the safeguarding of the financial stability of the euro area as a whole. Members will notice that it is in the interest of the public, not in the interest of one particular party. It seems that some in this Chamber do not understand the importance of financial stability and are willing to run the gauntlet on this matter, or they do not comprehend the implications of financial chaos.

The Greeks are a proud people and, as we are unfortunately well aware in Ireland, it is a very sad day when a nation loses control of its economic sovereignty to the troika, a lender of last resort, due to reckless fiscal planning by previous governments. However, the sovereign debt levels in Greece got to a point from which there was no returning without external aid.

The rationale of the lending facilities within the euro area is to counteract the unsustainable fiscal policies that were being implemented by governments within Europe and the ECB. As a Labour Party member, I resent having to push through very painful spending cuts, which can push economies into recession, without counteracting growth agendas. The euro area loan facilities are in place to counteract the huge rise in the cost of borrowing that these countries faced recently and to ensure wages and services are not slashed or cut off overnight.

As we all know, Greece's national debt-to-GDP ratio was as high as 160% recently. Its borrowing costs were unsustainable and, following lengthy negotiations, another bailout for Greece was agreed recently as €14.5 billion of Greek bonds were about to expire.

What went wrong in Greece? Some of this story may sound familiar. Upon joining the euro, it became easier for the country to borrow money. Greece went on a debt-funded spending spree, including paying for high-profile projects such as the 2004 Athens Olympics, which went well over budget. The country was hit by the downturn, which meant it had to spend more on benefits and received less in taxes. There were also doubts about the accuracy of its economic statistics. Greece's economic problems meant lenders started charging higher interest rates to lend it money. Widespread tax evasion also hit the Government's coffers, as has been well documented throughout.

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