Written answers

Tuesday, 3 May 2011

9:00 pm

Photo of Tommy BroughanTommy Broughan (Dublin North East, Labour)
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Question 134: To ask the Minister for Finance if his attention has been drawn to consideration being given by the EU Commission and the European Central Bank to developing a unitary fiscal regime whereby Ireland, Greece and Portugal and any other Troika assisted Euro States will never completely return to the financial markets as fiscally independent States; his views on such a proposal; and if he will make a statement on the matter. [9317/11]

Photo of Michael NoonanMichael Noonan (Minister, Department of Finance; Limerick City, Fine Gael)
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I am not aware of any such proposal. The stated aim of the existing EU - IMF Programme is to enable Ireland to return to the financial markets, and the programme provides the breathing space to achieve that.

As the Deputy will be aware, the European Council has agreed on the need for euro-area Member States to establish a permanent stability mechanism: the European Stability Mechanism (ESM). Arrangements for the establishment of the mechanism are currently under discussion at EU level. My officials and I are contributing to those discussions as appropriate. The ESM will be activated by mutual agreement if it is indispensable to safeguarding the financial stability of the euro area as a whole. The ESM will assume the role of the European Financial Stability Facility (EFSF) and the European Financial Stabilisation Mechanism (EFSM) in providing external financial assistance to euro-area Member States after June 2013.

The ESM will grant short-term or medium term stability support, under strict conditionality to a euro-area Member State, which is experiencing severe financing problems or is threatened by severe financing problems in order to safeguard the financial stability of the euro area as a whole. The length of the programme and maturity of the loans will depend on the nature of the imbalance in the beneficiary Member State and the prospects of the beneficiary Member State regaining access to financial markets within the time that ESM resources are available.


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