Michael Noonan (Limerick East, Fine Gael)
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Question 48: To ask the Minister for Finance the discussions he has had with representatives of the European Central Bank with a view to an agreement that the bank will buy Irish bonds when the country re-enters the market in the new year; and if he will make a statement on the matter. [41892/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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In order to give the markets time to digest the end of September statement on banking and the four year budgetary plan, the National Treasury Management Agency decided not to proceed with the planned bond auctions for October and November and has stated it will return to the bond markets in early 2011. The NTMA has achieved the target of raising €20 billion from the bond markets in 2010 and allowing for cash balances, retail debt and long-term funding carried over from last year, the Exchequer is fully funded well into the first half of 2011. This is an important point that is sometimes overlooked when people comment on Ireland's funding position.

The NTMA has advised that the European Central Bank does not participate in the NTMA's auctions and in fact the ECB does not purchase debt directly from governments but does so only, and on a limited basis, in secondary markets. There has been speculation recently about the scale of the ECB's purchases of Irish Government bonds under the emergency measures introduced in early May to stem the euro area debt crisis.

However, to put the ECB's involvement in context, the NTMA advises that while total turnover in Irish Government bonds since July has been over €50 billion; total ECB buying across all euro sovereign bonds in this period has been just €3.7 billion or so. That is an important statistic which bears repetition. The total turnover in Irish Government bonds since July has been €50 billion and the total ECB purchasing across all euro sovereign bonds has been approximately €3.7 billion. The ECB does not disclose details of the breakdown of its holdings of sovereign debt.

Irish Government bonds are bought and actively traded in the secondary markets by a broad range of investors, both domestic and international, but primarily by financial institutions including fund managers, banks, insurance companies and pension funds, as well as supranationals and central banks. Due to the nature of the international bond markets, it is not possible to classify bond holdings to the level of individual financial institutions. In addition, any such information would be considered commercially sensitive.

However, the NTMA has advised, based on figures published by the Central Bank for the period to the end of September, that it is estimated that about 84% of Ireland's bonds are held by international investors. Therefore, the question of discussions with representatives of the ECB in the circumstances outlined by the Deputy does not arise and has not arisen.

Michael Noonan (Limerick East, Fine Gael)
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I thank the Minister for his reply. Some of the statistics, as he said, are very interesting. Could the Minister outline the strategy which he has and which I presume he has discussed with his Department and the NTMA for getting Ireland back into the bond markets in the new year?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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That has been a matter of public record since September. The strategy is two-pronged. The first element of it was contained in the September announcement to bring finality and clarity to the exposure of the Irish banking sector and gave the market ample time to digest that information. The second element of the strategy is to publish the four-year fiscal plan which will contain a credible set of decisions which any Irish Government must take to meet the 3% requirement by 2014 and, as the first instalment of that strategy, to do a front-loaded correction of at least €6 billion this year. They are the two crucial elements of the strategy.

Michael Noonan (Limerick East, Fine Gael)
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That is the background, of which we are all aware. When Christmas passes and we are in the new year and a decision is made to go back into the markets in middle to late January or early February, what is the strategy, if the Minister has one, to re-enter the markets with safety and a feeling of confidence that whatever is offered will be taken up at reasonable prices?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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It is important to bear in mind that the NTMA advised me we should not hold auctions in October and November, and I agreed with that advice. It was open to us to hold these auctions. We were not shut out of the market; we decided not to make an offer to the market. Clearly, as my reply pointed out, we intend to return to the market early next year and the NTMA will of course advise me about the appropriate circumstances and the different initiatives that may be required on its part to ensure that there is participation in any such issue.

Joan Burton (Dublin West, Labour)
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Question 49: To ask the Minister for Finance if he has examined the terms and conditions of the European Financial Stability Facility; the rate of interest he would expect to be charged to a eurozone Member State participating in the EFSF, at what maturity and on what terms and conditions; the maximum term of borrowing under the terms of the EFSF; to set out the extent of the contacts to date between executives or representatives of the EFSF since its establishment and the Minister and his officials; and if he will make a statement on the matter. [41830/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Ireland has not sought assistance from the European Financial Stability Facility, EFSF, and as the NTMA has repeatedly stated, Ireland is fully funded well into next year. In terms of contacts between my officials and executives or representatives of the EFSF, there have been no contacts other than those made in the context of normal EU business.

The EFSF is established as a limited liability company, a société anonyme, incorporated in Luxembourg of which the euro area member states are the shareholders. In common with other member states, our contacts with the EFSF have related to the establishment of the company, our pro rata contribution to its share capital and representation at board meetings.

I can, however, confirm for the Deputy's information that the terms and conditions generally under which the EFSF may make loans to euro area member states are set out in the EFSF framework agreement which was scheduled to the European Financial Stability Bill 2010, which has been laid before the Houses of the Oireachtas. The arrangements governing individual loans would be determined in the context of specific loan facility agreements. Under the framework agreement, it is envisaged that the EFSF may provide loans during the three year period up to 30 June 2013.

As the Deputy is aware, the Government has taken firm action over the past two years to tackle the deterioration in the public finances. Those actions are resulting in a stabilisation of the underlying general Government deficit this year. We are now preparing a four year budgetary plan which will set out the pathway to stabilising general Government debt and to bringing the deficit below 3% of GDP by the end of 2014. This is part of the wider strategy being pursued by the Government which has addressed the difficulties facing the banking system, will bring sustainability to the public finances and will see ongoing improvements in competitiveness.

Joan Burton (Dublin West, Labour)
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Did the Minister not find it depressing or shameful that on Monday evening he was on national television giving a press conference in his Department with Commissioner Rehn? Did he not find it depressing and humiliating for us as a country that the Opposition had to troop in yesterday to meet the very polite Commissioner Rehn? It was an indication that our sovereignty as a country has, in effect, been put in severe peril by the actions of the Fianna Fáil Government. Does the Minister understand that sentiment towards Ireland is a result of the fact that the markets lack confidence because everything the Minister has said has proved to be far worse than first anticipated?

Has the Minister or any of his officials had contact with Mr. Klaus Regling? Perhaps the Minister would like to outline the contacts. Could the Minister also tell us how many members of the staff of the Commission are currently in his Department on a temporary or daily basis overseeing Irish budgetary and financial matters?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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First, I have had no contact whatsoever with Mr. Klaus Regling since he was appointed to head up the facility. I of course met him when he visited Dublin earlier in the year-----

Joan Burton (Dublin West, Labour)
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What about the Minister's officials?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Can I deal with that? Can I answer the questions? I of course met Mr. Regling when he wrote with Mr. Max Watson a report on the history and causation of the current economic difficulties in Ireland last summer. I supported his appointment as a member of the financial council and we are fortunate that someone who has considerable familiarity with this country is in that position. I have had no contact with them and neither have my officials, as far as I am aware. Certainly, no contacts have been reported to me.

I cannot rule out an incidental contact, and the Deputy will appreciate that, because he now holds a position in the European structure and it may be the case that meetings take place in the ordinary course of business which have nothing to do with Ireland at which my officials are present, but there has certainly been no contact between me and Mr. Regling regarding Ireland.

I hope that is a sufficiently comprehensive answer to the Deputy's question.

In relation to the alleged presence of Commission officials in my Department, there are no Commission officials in my Department on a permanent or any other basis. They do not have offices or regular spaces in my Department. That does not exist. Incidentally, although the Deputy did not ask the question but for the record, neither are there officials from the European Central Bank in my Department. Neither the European Central Bank nor the Commission has staff permanently attached or permanently present in my Department and there is no permanent facility for their accommodation in my Department.

Michael Noonan (Limerick East, Fine Gael)
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Did the Minister check the basement?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The old land bond lottery machine might still be in the basement but I am not aware of the presence of any European officials there.

Brendan Howlin (Wexford, Labour)
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A brief supplementary from Deputy Burton.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Of course,-----

Brendan Howlin (Wexford, Labour)
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Please allow-----

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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-----just to finalise my answer and to assist the Deputy, officials from-----

Brendan Howlin (Wexford, Labour)
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I advise the Minister that the time is well up and there will not be time for supplementaries.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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All right, I will not try to assist further.

Joan Burton (Dublin West, Labour)
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Does the reference to his officials include reference to the staff of the NTMA? Has the NTMA had any dealings or contact with Mr. Regling or with Mr. Regling's offices?

Commissioner Rehn, who is hardly interested in lying to the mere Opposition in Ireland, yesterday introduced us, and perhaps Fine Gael, to a gentleman who was on his delegation who is currently, clearly, one of the leading persons dealing with the Minister's staff in the Department of Finance on the preparation of the forthcoming budget. He was a tall gentleman with glasses, I believe, from Hungary.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Deputy Burton went on the national broadcaster yesterday and suggested that there is a Hungarian employed in the Department of Finance.

Joan Burton (Dublin West, Labour)
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I never used the word "employed".

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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He happens to be a Hungarian.

Joan Burton (Dublin West, Labour)
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The Minister is a barrister-----

Brendan Howlin (Wexford, Labour)
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Please allow the Minister to reply.

Paul Kehoe (Wexford, Fine Gael)
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Arthur Griffith would have been delighted.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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He happens to be a Hungarian. He is an EU national and he is part of Commissioner Rehn's staff. He is not part of the complement of the Department of Finance.

Joan Burton (Dublin West, Labour)
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Is it just that-----

Brendan Howlin (Wexford, Labour)
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Please allow the Minister.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Let me put that on the record of the House first. Commissioner Rehn must deal with 27 member states. It is natural and understandable that he has a particular official who helps him liaise with the Irish position.

Joan Burton (Dublin West, Labour)
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If this is-----

Brendan Howlin (Wexford, Labour)
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Please allow the Minister.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Out of courtesy, he advises Deputy Burton who that official is and I hear on the national broadcaster later in the day, or in some broadcast, that this gentleman is a Hungarian who works in the Department of Finance.

Joan Burton (Dublin West, Labour)
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I never said-----

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I have put the facts on the record of the House. This is the gentleman, who is an EU national, who assists the Commissioner, who his also an EU national, on Irish matters. There are officials who advise him on Slovenian matters, Slovakian matters, German matters and French matters. This is the official who helps him on Irish matters.

Brendan Howlin (Wexford, Labour)
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We need to move on.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Out of courtesy, the Commissioner pointed that out to Deputy Burton.