Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I presume the Deputy is referring to EU-IMF programme-related debt when he asks about renegotiation. This debt accounts for about one quarter of Ireland’s total debt.

My Department, in conjunction with the National Treasury Management Agency, NTMA, is constantly looking to avail of any appropriate opportunity for savings on the cost of our EU-IMF programme loans and the matter is constantly reviewed. Our debt-to-national income ratio has declined significantly in recent years. However, I recognise the limitations of using GDP, gross domestic product, as a proxy for our national income. For a more meaningful assessment of trends in public debt in Ireland, it is important to look beyond this simple measure.

While other debt sustainability measures such as the debt-to-revenue ratio and the interest-to-revenue ratio are also improving, they clearly demonstrate that our debt level is high by international standards. Accordingly, reducing it must remain a priority. Our economy is growing strongly. Our public finance deficit is declining, as are our debt service costs. We are now running a primary budget surplus. All of this is positive from a debt sustainability perspective. In addition, the proceeds from the recent sale of part of the Government’s shareholding in AIB will reduce the overall level of public debt.

As regards seeking renegotiation as suggested by the Deputy, he should be aware that significant improvements to the terms of our EU-IMF programme loans that have already been secured since they were initially agreed in late 2010. There have been two separate maturity extensions granted to loans from the EFSM, European financial stabilisation mechanism, and the EFSF, European financial stability facility. These extensions mean that the next EFSF maturity is not until 2029, while it is not expected that Ireland will have to refinance any of its EFSM loans before 2027. All of this has delivered significant savings for this and future generations.

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