Stephen Donnelly (Wicklow, Independent)
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126. To ask the Minister for Finance further to the summit of European leaders in Brussels on 28 June 2012 which concluded with a summit communiqué which included a statement the Eurogroup will examine the situation of the Irish financial sector with the view of further improving the sustainability of the well-performing adjustment programme, if he will confirm the total amount contributed by Ireland to the European Stability Mechanism since that summit in 2012; if he will confirm that these contributions to the ESM have added to the State’s national debt. [28071/14]

Michael Noonan (Limerick City, Fine Gael)
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The Euro-area Heads of State or Government (HoSG) agreed in June 2012 that "it is imperative to break the vicious circle between banks and sovereigns", and that when a Single Supervisory Mechanism, involving the ECB, is in place and operational, the European Stability Mechanism  (ESM) could recapitalise banks directly. It also agreed that the Eurogroup would examine the situation of the Irish financial sector with a view of further improving the sustainability of the well-performing adjustment programme.

The ESM Treaty entered into force on 27 September 2012,  in accordance with Article 48.1 of the ESM Treaty, following ratification by euro area Member States representing over 99.8% of its subscribed capital base. The European Stability Mechanism Act 2012 provides for Ireland's membership of the European Stability Mechanism (ESM) and payments into it. The capital structure of the ESM is set out in the ESM Treaty and provides for a total capital subscription of €700 billion, of which €80 billion is paid-in capital.

Ireland's share of this paid in capital is €1.27 billion. This was paid in 5 equal tranches of €254.752 million two tranches were paid in 2012, a further two tranches were paid in 2013, and the final tranche was paid in April of this year.

The ESM has been established as an International Financial Institution and on that basis Ireland's contribution will be treated as a financial transaction and considered as an equity investment for Ireland. This means that payments towards its paid-in capital have no impact on the general government deficit. The payments, however, are included in Ireland's Exchequer Borrowing Requirement and thus add to the National Debt, and the general government debt.