Eamon Gilmore (Dún Laoghaire, Labour) | Oireachtas source

The Deputy is missing the point. I refer to direct supervision. The supervisory mechanism will embrace the entire supervisory system of the European banks. We need to stand back from this. Initially there was a great deal of scepticism about it. First, there were those who said there would never be agreement to separate bank debt and sovereign debt or to allow for the ESM to recapitalise banks. Despite the scepticism agreement was reached in June that this would be done. Then there were those who argued there would be a pull-back from that position in October; there was not. Instead there was a commitment that the legislative framework would be put in place by the end of the year, and this has now been agreed. The second two elements of banking union, namely, the bank resolution issues and the deposit guarantee scheme issues, are to be proceeded with in the early part of 2013. Far from undermining progress on banking union, progress is taking place. That is something we must welcome, first, from the point of view of the European banking system and, second, because of our own interest in the issue.

I refer to the discussions on the ECB. We must return again to the formula agreed in June, which was that the Eurogroup would take it forward, the situation in the Irish financial institutions would be addressed on its merits and, as has been clarified by a number of European leaders in the intervening period, this is being addressed on the basis that Ireland is a special case. The discussions with the ECB are being conducted, in the main, by the Irish Central Bank, and are being backed up by political level discussions which are taking place with the Eurogroup and ECOFIN, conducted by the Minister for Finance. At a political level they are being conducted by the Taoiseach and I. That process has been underway for some time and progress is being made. As we stated from the beginning, our objective is to get the right deal for Ireland rather than set ourselves some artificial deadlines.

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