Written answers

Thursday, 11 December 2008

8:00 pm

Photo of Emmet StaggEmmet Stagg (Kildare North, Labour)
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Question 23: To ask the Minister for Finance the amount the Exchequer will borrow in 2009; the amount he intends to raise through the National Treasury Management Agency on capital markets in 2009; if a schedule has been established for this debt raising; the recent changes in the cost of Exchequer borrowing; and if he will make a statement on the matter. [45352/08]

Photo of Brian Lenihan JnrBrian Lenihan Jnr (Dublin West, Fianna Fail)
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The NTMA have advised me that their annual net funding requirement is determined by the level of the Exchequer Balance and the amount of maturities of existing loans. Based on Budget 2009 projections, the NTMA has advised the market of its funding plans for 2009 which includes a €5 billion bond repayment in April 2009. As such a gross debt issuance requirement of €18.4 billion next year is currently being planned. This will obviously be reviewed in the light of the position at end 2008.

The funding requirement in respect of 2009 will be met by a combination of new syndicated benchmark bond issues and auctions. The NTMA's objective is to further develop a continuous and liquid yield curve for Irish Government bonds. The NTMA has advised me that it is in a comfortable cash position and will decide on the timing of its issuance in the light of market conditions.

The interest rates at which the State can borrow are historically low. However, as a result of the increased borrowing requirement in 2008 and 2009, the interest element of the servicing of the national debt has been forecast to increase from €1,641 million in 2008 to €3,295 million in 2009. The 2009 estimate represents around 2% of GNP and this is in line with the average over the last 10 years.

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