Leo Varadkar (Dublin West, Fine Gael)
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Question 207: To ask the Minister for Finance if he has estimated the increased cost of Exchequer borrowing in 2008 and 2009 as a consequence of the Credit Institutions (Financial Support) Bill 2008; and if he will make a statement on the matter. [34023/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The nature of the guarantees to be provided by the Government under the Credit Institutions (Financial Support) Act 2008 are such that they will not be included in the General Government Balance or the Debt. The Deputy may wish to note that over the two year period of the guarantee the covered institutions will pay a significant charge for the guarantee.

I am informed by the NTMA that there are no apparent immediate effects on the cost of short term borrowing. In relation to the cost of long term borrowing this is a function of a range of factors including short term volatility in the markets, the underlying trend in spreads, the weakening budget position. It is difficult at this time to give any estimation of the impact of the introduction of the guarantee scheme over the longer term.