Pearse Doherty (Donegal South West, Sinn Fein)

The agreement is that this vicious cycle of sovereign and banking debt is to be broken. If that were the case and if Anglo Irish Bank were to emerge in France and massive losses were to be incurred, it is likely the ESM would incur those losses. Is the Irish Government going to argue that if that is the process to be put in place - the ESM absorbs the losses rather than taxpayers - then we should put that on the table? Are we going to argue that we want the losses which we know exist in Anglo Irish Bank, or IBRC, to be absorbed by the ESM if that is what will happen with other banks? I know there will be difficulties in Europe with this because they are realising losses immediately. However, if they are willing to countenance realising potential losses into the future and if the principle of retrospection is to apply properly, then they need to realise the losses we have already incurred within our banking system.

I am fearful we will just end up with a longer duration for the promissory note and that we will swap our shares in the living banks for the current value of the €28 billion injection, which is estimated by the NTMA to be €9.6 billion and which is probably overvalued. That is of no direct benefit to the State for a long-term solution because there is a value in the shares. As Deputy McGrath said, we must show more ambition. The €64 billion in total must be put on the table and the principle of retrospection must be enforced. The Minister has to fight hammer and tongs on the principle of retrospection. If it is good enough for Spain, Italy, Germany or any other European country, then it needs to be applied to Ireland, given what we have experienced.

See this speech in context