Michael McGrath (Cork South Central, Fianna Fail)
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Question 18: To ask the Minister for Finance the current position in regard to plans to increase the size of the European Stability Mechanism; and if he will make a statement on the matter. [14830/12]

Michael Noonan (Limerick City, Fine Gael)
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The ESM Treaty was signed by Euro Area Member States on 2 February 2012. The original version of the Treaty was signed on 11 July 2011, but it has been modified to incorporate decisions taken by the Heads of State or Government (HoSG) of the Euro Area on 21 July and 9 December 2011, aimed at improving the effectiveness of the mechanism.

The Treaty will have to be ratified by the 17 Euro Area member states; it will enter into force and the ESM will become operational as soon as possible: the target date is July 2012, a year earlier than originally planned. As a permanent mechanism, the ESM will take over the tasks currently fulfilled by the European Financial Stability Facility (EFSF) and the European Financial Stabilisation Mechanism (EFSM).

The subscribed capital of the ESM is € 700 billion (€ 80 billion as paid in capital, the rest as callable), and its initial maximum lending capacity is set at € 500 billion.

As decided on 9th December 2011, the HoSG will reassess the adequacy of resources under the ESM and the EFSF this month. At the HoSG meeting on 2 March, Member States confirmed their commitment to re-assess the adequacy of the overall ceiling of the EFSF/ ESM by the end of the month.