Pearse Doherty (Donegal South West, Sinn Fein)
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I am glad this topic was selected. Reuters Canada broke the story of the promissory note last week, followed by Reuters London and a Bloomberg interview that quoted three different sources from the meeting of the ECB last week, but this is the first time we have had an opportunity to speak about the restructuring of the promissory note and the fallout that occurred as a result of that meeting. In the past 24 hours three prominent economists have spoken on our radio and television stations, telling us it is unlikely that the Government will secure a deal on the promissory note. Although all of us in this House hope their words will be proven incorrect it seems the Minister's proposal is running into difficult waters.

It is almost a year and a half since we heard about the infamous technical paper that was to be agreed between the Government and the ECB on restructuring the promissory note. We were told to be patient, that work was ongoing with the troika, that officials were directly engaging, that the proposal was not an Irish one but had the direct involvement of the ECB. Everything seemed to be going grand. The Minister for Communications, Energy and Natural Resources, Deputy Pat Rabbitte, spoke on "The Week in Politics". I shared the studio with him that evening when he stated categorically that the promissory note would not be paid this March. After a year and a half of these so-called discussions we heard the first formal proposal was to be put by the Governor of the Central Bank to the ECB governing council. Then we learned that the proposal had either been rejected or was about to be rejected. In fairness, the governor, Professor Honohan, had the wisdom to withdraw it before it was formally rejected.

How did we - or the Government - get it so wrong? How come the mood music with the ECB governing council was wrong? How was it that this preferred option was rejected? How come we made a proposal in the first instance when we were not sure it would succeed at that meeting, given this was not something that happened only last month or last week but has been ongoing for a year and a half? Will the Minister explain to me how we misinterpreted the position of the ECB on this issue?

The Minister will be well aware that the next governing council meeting of the ECB will take place a week from tomorrow. Will the governor, Professor Honohan, have a proposal to put before the council at that meeting? Is the Minister satisfied there is an option to put before the council? He knows well my position and that of my party; it is also the position of many people who do not want to pay taxes to fill the black hole of Anglo Irish Bank. We want to see a write-down of the promissory note, not an extension of duration. Will the Minister explain, in black and white terms, what this will mean to me and my family and to next year's budget? That is how ordinary people judge this. Is it not the case that if we do not pay the promissory note next year some €1.8 billion of adjustments will not be required in order to meet the troika targets? The Minister might explain the target he would like to have, the type of deal. There has been much talk about a deal but one person's good deal could be another's bad deal. Many people will judge this by the effect it will have on the budget; others will judge it in more detail because it will be complex. Perhaps the Minister might explain what the target is in terms of the impact he would like to achieve on next year's budget.

Michael Noonan (Limerick City, Fine Gael)
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As the Deputy is aware, the Government has been working extremely hard to secure a deal on the Irish bank debt with our European partners. Detailed work will continue in order to maximise the benefit of any deal to the Irish taxpayer. Negotiations are continuing and I advise the Deputy that conclusions on their outcome are premature at this point. I have stated previously that I am working to try to achieve a solution before the next scheduled instalment on the promissory note in March. It would be very difficult for Ireland to make a payment on the promissory notes and so we continue to work on a deal with our European partners to resolve this issue.

The focus of the on-going detailed discussions has progressed to consideration of all options in regard to the promissory notes, such as the source of funding, the duration of the notes, the interest rate applicable etc., as well as potential avenues for the wider bank debt deal and the impact of these options on the IBRC. This work is one of the Government's key priorities and will remain a key focus during the EU Presidency.

As previously advised to the House, the terms sought by the Government are those which will achieve the best possible outcome for the Irish taxpayer. It is not possible to give guidance on the timing or potential outcome of the discussions as to do so could impede our ability to achieve the best possible results but every effort is being made to expedite the ongoing process. I am satisfied that every available and appropriate opportunity to advance Ireland's position with our European partners in regard to legacy bank debt is being availed of and that every effort to maintain the issue of the Irish bank debt at the top of the European agenda is being made. I remain confident that an agreement can be reached.

The numerous references made in Europe to Ireland's special status in regard to discussions on these matters gives comfort, and the Irish Presidency will build on this. The recent comments of the European Council President, Herman Van Rompuy, following his meeting with the Taoiseach and Tánaiste, about his support for a positive outcome in our negotiations is to be welcomed. I have always stated that our problems are part of a wider European dilemma and any solution to address the Irish situation must be as part of an overall eurozone and global solution. The shift in European policy in terms of breaking the vicious circle between the banks and the sovereign is to be welcomed and represents a major step forward.

I am glad to say we meet with strong appreciation of our situation and are able to have very constructive dialogue on our approach to this question. While these negotiations are ongoing we will consider all viable solutions which will achieve an improvement in the position of the Irish State with respect to the promissory notes.

As the Governor of the Central Bank stated recently to the Oireachtas Joint Committee on Finance, Public Expenditure and Reform, there has been a very intensive process of discussion and negotiation on this matter, which is one of the main thrusts of the Government's policy in Europe. It is not easy to find a generally acceptable solution and an initiative of this type must take into account both the statutory position and the wider policy stance of the ECB. We have been working carefully to build understanding and confidence around a set of proposed transactions designed to deliver for Ireland, and that work is ongoing.

Pearse Doherty (Donegal South West, Sinn Fein)
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The Minister did not enlighten us at all because he gave no additional information. I appreciate he will not give us the detail and intricacies of discussions at ECB governing council meetings but can he tell the Parliament whether a proposal, agreed by him, was put forward by Governor Honohan, and if so whether it met with resistance? Is the preferred option off the table and are we looking at Plan B? Is the Government looking at a rehash or a different type of option to present to the next governing council of the European Central Bank? Is the Minister satisfied that an option will be prepared in time to be presented to the next board meeting? I understand there will only be four others before the date in question.

How come, after a year and a half of direct discussions with the ECB, it all went so wrong, with the mood music being completely misinterpreted? What does the Minister believe will be the impact on the budget next year? Will we see €1 billion worth of savings next year? Does the Minister agree with the Minister, Deputy Rabbitte? We might take any of those questions about the payment not being made in March. The Minister said it was difficult but I see a Minister for Finance who is standing, willing and able, to pump €3.1 billion of our taxpayers' money into Anglo Irish Bank if he does not achieve the outcome he has set himself with the ECB. That is the wrong stance, as I have stated from day one. Ireland should take a much tougher stance and declare the country is broke. We should look at all the statistics. I referred today to the 100,000 people who have contacted the Society of St. Vincent de Paul, the one in four in mortgage distress, the 15% who are unemployed, the 85,000 or 87,000 who emigrate every year. To pick any one of those figures would give a rationale for the Minister for Finance to stand up and state that not only would it be uncomfortable for this State to pay the promissory note but it is not in a position to make a payment on 31 March 2013.

The ECB must understand that. We do not need the type of pussyfooting that has been taking place between the Government and the ECB. Has the technical paper been completed? Does that paper actually exist? I have asked many questions and I would appreciate it if the Minister could reply to at least one or two of them.

Michael Noonan (Limerick City, Fine Gael)
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The Deputy asked at least a dozen questions. The underlying position is that Sinn Féin's political strategy is to build a political movement based on the hope that the Government will fail, that the economy will decline into a worse state than it was in when we inherited it and that the people will suddenly turn to Sinn Féin to rescue them from their misery. All of the questions posed by those in Sinn Féin are geared towards positioning themselves so that any deal, good, bad or indifferent - I am of the view that we will obtain a good deal - can be rejected by them. Sinn Féin's alternative position is default. I have informed the Deputy on several occasions that the Irish Government is not going to default. If he wants to know why that is the case, then he should consider what happened in Argentina just last week and what has previously occurred since it defaulted on two occasions. If he does so, he will discover why default is not an option. While it may be Sinn Féin policy, we are not going to default.

We are negotiating a deal and there is no reluctance to discuss that deal in the House. Just two weeks ago I dealt with a series of questions on this matter in the House, one of which was tabled by the Deputy. In reply to a question from Deputy Sean Fleming, who was substituting for Deputy Michael McGrath, I stated that I believed a deal was likely. I have never varied my position by saying that the end date is 31 March. I have never given any date but that one. We will have a deal before this year's payment on the promissory note is due. We are negotiating against the date to which I refer. I am of the view that a satisfactory arrangement will be arrived at. If that does not prove to be the case, the Deputy can come into the Chamber and take a couple of shots at me. The negotiations are ongoing. The normal course of negotiations is that the easy issues are dealt with early on and the difficult matters are agreed at the end. We have been systematically obtaining agreement on issues and we will continue to do so until a complete deal is arrived at.

The Deputy spoke about eminent economists making predictions. I do not believe such economists have any particular inside knowledge of what is happening. It is a matter of opinion. Many eminent economists have been offering their opinions for the past two years and most of them have been wrong in their predictions. When I refer to eminent economists, I am not referring to those who commented this week or last week. It must be noted that many individual economic predictions made since the Government came to office have been wrong. We hope we can obtain a deal and we will continue to negotiate. We would love if we had the support of all parties in the House in respect of what we are doing, which is in the national interest. However, we know we do not have the support of the Deputy's party.