Stephen Donnelly (Wicklow, Independent)
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Question 45: To ask the Minister for Finance the reason he believes that putting approximately €1 of public money into job creation via the jobs initiative for every approximately €70 going to the remaining unguaranteed senior bondholders is a sustainable path to recovery for Irish economy and society; and if he will make a statement on the matter. [14105/11]

Michael Noonan (Limerick City, Fine Gael)
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Taking account of the state of the public finances and the need to repair our banking system, this agreement is committed to ensure that Ireland is put firmly back on a path to a more sustainable and equitable society. We are only in office a very short time and we have already brought forward a number of initiatives. For instance, the intention of the measures contained in last month's Jobs Initiative was to focus our now more limited resources on measures that offer the greatest potential for expansion and employment creation in the domestic economy. The aim is to target key sectors of the economy that can assist people back to work, provide opportunities for those who have lost their jobs to re-skill and build confidence in order to encourage consumer activity. The Initiative will cost just over €1.8 billion over the period to 2014.

Given our commitments under the EU-IMF Programme of Financial Support, and our current public finance difficulties the Jobs Initiative is budgetary neutral, over the period to 2014 and is being paid for through the introduction of a temporary levy on pension funds.

Fixing our banking sector is also a key part of this Government's economic strategy. At the end of March, the Government announced plans to reorganise, recapitalise and deleverage the domestic financial system. Accordingly, the three proposed banks - Bank of Ireland, AIB with EBS and Irish Life & Permanent - should be able to operate in the market place following their reorganisation, including regaining access to normal funding mechanisms. As part of this approach, the Government decided, informed by the reservations of the ECB, that these banks will not burden-share with senior bondholders of their constituent banks, whether guaranteed or unguaranteed.

As for Anglo Irish bank and Irish Nationwide, the Central Bank of Ireland recently reaffirmed the capital assessments made previously for these institutions. The need for further capital would only arise if the stress case arose and the estimate of that stress case is similar to the estimates in their restructuring plan. Should this worse-case scenario ever arise then the Government will agree an approach with our European partners, having regard to the financial stability impacts in Ireland and abroad to determine how any shortfall would be met.