Seán Fleming (Laois-Offaly, Fianna Fail) | Oireachtas source

Everyone must recognise that it is good Ireland is leaving the troika arrangement on 15 December 2013, the date originally envisaged for the exit. It is also good that over the three years during the course of the programme Ireland met all the macroeconomic targets set down. The visits from the troika to Ireland served a useful purpose, ensuring the Government continued to keep focused on the task at hand. I believe the public did not have a problem with the troika overseeing the implementation of the memorandum of understanding.

However, it is also important to note which reforms were not delivered during the three years. Some reforms were achieved, some of which would have been achieved without the troika. Some additional reforms could have been achieved, however. The mortgage arrears issue has not yet been substantially dealt with. Banks are now offering solutions to some mortgage holders advising them to dispose of their properties, which is only an attempt to reach a statistical target rather than a sustainable solution. Neither has unemployment been adequately dealt with. While every Member will agree there are plenty of job activation measures and that officials in the Department of Social Protection are dealing individually with those on the live register, more needs to be done. I often wonder if the Department should be merged with the other jobs Department, the Department of Jobs, Enterprise and Innovation.

We are still grappling with the financial management structures of our health sector. Even two weeks after the Budget Statement, there is a dispute about the level of savings to be achieved in the Health Service Executive, HSE, and whether it will be €666 million or €1 billion. The reason there is a struggle to meet the figures announced in the budget and to agree the annual service plan is because some of the figures for savings were plucked out of the air without any substantial backing.

Sheltered sectors of the economy such as the legal profession have not been dealt with either. A recent legal case concerning the contesting of a public right way at Lissadell House ended up in the Supreme Court. Sligo County Council, which did not have the €2 million to buy the house several years ago, has now ended up with legal fees almost three times that amount, some €7 million. It may well have been an issue of public importance, but it is fundamentally grossly obscene and immoral that the legal fees to determine a legal right of way across a path in front of a house could approach €10 million when the property itself is a fraction of that amount. The issue of disproportionate legal fees has not been tackled. I have not given up on Ireland dealing with this matter itself but an opportunity was missed to tackle it when the troika was here.

On Ireland’s funding requirements, we must look at the commitments we have to meet over the coming three years. Before 2016, Ireland will have maturing debt in the order of €35 billion. Some of that is government bonds while other parts of it are the payments under the EU-IMF programme from 2015. In 2014, we have maturing liabilities of €7.7 billion, €10.5 billion in 2015 and in €16.4 billion 2016, all of which accumulates to nearly €35 billion over three years. In addition to that, there is a deficit funding of €18 billion. While some believe we are out of our problems and will have budget surpluses, it is a bit unreal. If one were to use primary surplus as a measure of how well a country is doing, it would mean Greece would be one of the best performers in the EU while taking no account of its financing arrangements for the level of debts it has built up.

In the next three years, we have a funding requirement of €53 billion.

That is a significant factor to be taken into account when deciding whether Ireland should have a precautionary credit line in place. One of the most important factors in that debate is the State's underlying debt. Our general Government debt to the end of 2013 will be around 124%. We hope that figure will begin to reduce in 2014 to 120% and a little below that figure in 2015. If somebody goes into a bank to borrow money, the first question it will ask is what is his or her existing level of debt. Given that we have such a high level of debt, it makes it more difficult for us to borrow because people will be looking at the overhang of debt.

We must be fair and acknowledge that the NTMA has cash in hand of about €25 billion, which is substantial and will see us through 2014 and into 2015, but we cannot run it down to the wire. Ireland will need to be back in the international markets early next year when the season begins for raising funds. At that stage, I believe Ireland will be able to borrow successfully in the immediate short term, which in itself will be very important. People will wonder if we are finished with the troika, but we still owe the European Union, the IMF and the ECB a lot of money. They will be here at least twice a year for visits, making sure we are meeting commitments and continuing to make repayments and they will be doing this for a while. We also have commitments under the six-pack and the two-pack in our EU targets. The most important target is reducing our debt to 60% of GDP over a 20 year period and that can only be done by achieving surpluses in that time.

Everybody accepts that the precautionary credit line is a finely balanced issue, but when I met representatives of the troika during their last visit two weeks ago as part of the Fianna Fáil delegation, they told us that the mechanism for having a precautionary credit line could extend to up to 57 days. Not only would it have to go through the European Commission, it would also have to go through several national parliaments. That would involve going through the Bundestag and as we all know, the Labour Party's colleagues in Germany, in the SPD, have been raising the issue of our corporation tax rate. The Labour Party Members would do us all a favour if they were to ask their party colleagues in the European Parliament to desist from raising this as an issue, which is not fair. While we have a low rate of corporation tax, many countries have a higher nominal rate but a lower effective rate. Other governments might take the opportunity to raise a variety of issues and it would have been very difficult if the issue of Ireland's precautionary credit line had been kicked around the floor of various national parliaments. The Government was afraid to go down that road because we do not know what might come from a debate in the various national parliaments. We could get drawn into an another debate unconnected with Ireland. Parliamentarians in some countries might suggest all programme countries should come under one precautionary credit line system and not deal with Ireland on its own, even though we are the first to leave a programme. Fees would also have to be paid for the facility. While we might not draw down any money, the fee would have to be paid to put the facility in place and we probably would have to sign a new memorandum of understanding. These were complications from which the Government shied away. That is one reason it has chosen not to take that route.

I welcome the conclusion of the programme. It was always the intention that we would leave at the end of the defined three year period. The fiscal targets have been met and well achieved and people abroad are saying Ireland is in a strong position as we leave the ECB-IMF programme. On behalf of my own party, I can only say we hope the entry back into the private fundraising market is a success for Ireland in the years to come.

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