Enda Kenny (Mayo, Fine Gael) | Oireachtas source

The Deputy would never begrudge them a sip of red or white, as the case may be. I assure the Deputy that the Government and the Tánaiste and Minister for Foreign Affairs and Trade are highly conscious of the requirement to be realistic in expenditure these days, much more so than what happened in the past.

The Deputy asked me what is the role of the leaders in respect of our debt. The Deputy is aware of the process and, as a former Member of the European Parliament, knows what it is like. These matters go through a process until they come eventually to the Heads of State and Government for decision. In between, it may be necessary to have contact on an occasional or bilateral basis with individual leaders from other countries. However, the case must be put by an individual leader or Head of Government at the Council meeting to have something either adopted unanimously or agreed in whatever form. This is what happened in the case of the decision of 29 June 2012, where all the preparatory work was gone through by the permanent representatives, that is, the public officials. While it went through the process of Ministers for Finance, it was agreed by leaders. I did not describe this as a great breakthrough this morning. What I did say was it would be of considerable benefit to the country, were it to be agreed. I cannot foresee the conclusion of the discussions that will take place. As I stated, Commissioner Rehn stated this morning that were this to be agreed, it would happen at the meeting here in Dublin next month. Clearly however, Deputy Higgins should be aware there is quite a long way to go in this regard. The troika must carry out its analysis of the details of how this will work in respect of the different loans, the maturities and when they are due and so on. Moreover, it will be necessary for this to be adopted by each member state.

The Deputy asked me what is the benefit of extending maturities. Potentially, it is highly significant and will be beneficial for Ireland as it will reduce the amount the National Treasury Management Agency, NTMA, will be obliged to re-finance on the debt markets in those years in which the loans originally were due to be repaid. I speak now in respect of the extension already agreed here. In addition, the cost of such term loans from the European Financial Stability Facility, EFSF, and the European Financial Stabilisation Mechanism, EFSM, is likely to be lower than what Ireland would be obliged to pay in the debt markets, given the superior credit rating of these institutions of Europe in the coming years. It will be cheaper for Ireland to hold onto that. This is particularly important as there are significant amounts of existing non-European Union-IMF debt maturing between 2015 and 2020 and accordingly, an extension of those maturities would be viewed positively by the debt markets and therefore would benefit Ireland's overall cost of borrowing.

That decision serves as an example of the progress the Government has made and is making at European level in reducing the cost of the European Union-IMF programme entered into by the previous Administration. Some of the issues that have happened in this regard, such as the replacement of the promissory notes, the liquidation of IBRC, the agreement on 29 June last and the specific reference to improving the sustainability of the programme here, are issues that are relevant to us. Moreover, Ireland will not be obliged to repay principal on promissory notes until 2038, which gives us a real opportunity to get our house in order, to have our economy well run and to have a prosperous country in which we can really focus on the question and the challenge of creating jobs. I listened to President Clinton when he visited two years ago when he made the point that the historical fact about every country that goes through a recession is that when it is over, it takes at least ten years to make that benefit filter down to people on the ground in the context of creating jobs. He stated the challenge for Ireland was to short-circuit that and to prove it can have real benefit from exiting a programme, restoring its public finances and getting its economy back to good health but to focus on the creation of jobs and not to have a so-called jobless recovery.

This is a challenge about which this House and Oireachtas have a lot of ideas. The Government is willing to act in the interests of getting people off the live register, of making decisions that will increase flexibility and access to credit for small businesses in order that jobs can be created and to retain the strong elements of what we already have. I refer to both Enterprise Ireland, in terms of exports and jobs being created here and in other countries but with profits accruing to Ireland, as well as to the continued line of strong foreign direct investment into Ireland, further evidence for which was demonstrated today. Deputy Higgins should be aware this is the really big challenge for the country. It must sort out its public finances and put its economy into a place where it is growing and becoming prosperous but must do so with a direct beneficial impact on the creation of jobs. The extension of maturity dates would be of benefit to Ireland with regard to the cost of its borrowing and the sustainability of its capacity to repay, as well as by giving the Government the opportunity to make decisions to grow job numbers and to give the people hope, confidence and real benefits by short-circuiting what has happened in other countries on a regular basis.

That is what we will focus on for the next period, to see how we can really create jobs and get people off the live register. The Minister for Social Protection is making a huge structural change to give effect to that.

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