Enda Kenny (Mayo, Fine Gael) | Oireachtas source

I imagine Deputy McDonald understands the vast difficulties that face the people of Greece now. I have outlined some of the decisions that have been taken in terms of restructuring, the dismissal of public service workers and reductions in pensions and pay. I have also referred to the inability to meet various bills and the necessity to put in place a tax structure that will deliver.

I listened to all the talk six months ago about Greece defaulting and being driven out of the euro and about the catastrophe facing us. However, at the meeting there was a recognition by the finance Ministers of a situation whereby after another election the people in Greece elected another Government, which set about trying to deal with the problems. As a result of the decision taken and agreed last night the Greek debt to GDP ratio will still be at 124% by 2022. Given their levels of unemployment and the challenges they face, that is absolutely vast. Greece is in a different place entirely from Ireland.

Why are we a special case? What does this mean? I suppose the circumstances that apply are different. We are placed in a unique situation because of the fact that on top of the national debt our people were required to shoulder the burden of a recapitalisation fund of more than €64 billion.

There is a recognition politically and economically of how it is that Ireland finds itself in this situation. That is the reason the circumstances are different and, therefore, the case is special.

The decision taken on 29 June related to breaking the link between sovereign and bank debt, which could lead to direct recapitalisation by the ESM. The question that then arose was whether that included legacy debt in banks in other countries. In Ireland's case, it is all legacy debt in the sense that what is done has already been done. Our situation is different from that of a banking system in another country which might get into difficulties and require funding from the ESM in the future. The decision was taken on the basis of its potentially leading to direct recapitalisation. For us, it was a recognition of our particular circumstances and, as a consequence, a definition of Ireland as being a special case. The discussions with the finance Ministers are about whether this special case and these unique circumstances can be taken into account. Ireland's case is different from that of a bank in another country that may experience difficulties in a year's or two years' time. We have already been, and still are, in difficulty and have had to recapitalise our banks. The creative discussions and negotiations will be concerned with how we can use the potential of the ESM to deal with that.

I have previously outlined the position with regard to the promissory note, and I will not go into the detail of that matter for Deputy McDonald except to say, as I have already said, that the next payment is due in March 2013. We would like to be in a position, by that time, not to have to issue another up-front payment of €3 billion. As I previously told Deputy Martin, I had the privilege of opening a small school in the west last year which cost €1 million. Three thousand such schools could be built every year for ten years for the amount that has gone into Anglo Irish Bank, now IBRC, which is extraordinary. In any event, it is in that space that the discussions are taking place between the Minister and his officials and officials from the European Central Bank in Frankfurt. The intention is that by March 2013 the promissory note will have been re-engineered in such a way as to ensure we will not have to fork out €3 billion. That is our hope and intent. As I said, the European Central Bank is governed by 17 governors from the different countries in the eurozone, all of whom have their own opinions on a whole range of issues. That is where the discussions are.

The Deputy also asked whether progress had been made. Yes, I would say so. If the Deputy is asking me for a specific date in this regard, it is hoped the matter will be dealt with by March 2013. Obviously, the quicker the better. However, that is the target.

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