I wish to provide the House with an update on recent developments affecting the Irish banking and financial systems following my discussions with European colleagues both at the euro group and the ECOFIN council earlier this week. First, I wish to reassure all depositors in the guaranteed banks and building societies in Ireland that their deposits continue to be safe and secure.
The commencement of technical discussions between the Irish and international authorities seems to have generated misinformed, inaccurate and, in some instances, mischievous comment about the protection of deposits under the State's bank guarantee scheme. In such circumstances, it is important to reaffirm the State's commitment to the safeguarding of all deposits and the other liabilities guaranteed under the eligible liabilities guarantee, ELG, scheme approved yesterday by both Houses of the Oireachtas. The scheme will be in force until the end of 2011 subject to a six month review by the European Commission.
The extension of the guarantee has been approved by the European Commission and was endorsed by the European Central Bank on financial stability grounds. The urgent and essential requirement for the prolongation of the scheme to underpin the funding position of the banking system was set out clearly in the House yesterday. It is inconceivable that any measure would be proposed by any party to jeopardise the protection afforded by the Irish State to depositors under the bank guarantee scheme. Any other view is simply wrong and wholly at variance with the fact that in their statement on Ireland on Tuesday evening the euro group lent its support to bank guarantee arrangements in Ireland. Let me be clear: deposits are safe. Nothing in the content of the discussions underway or anything that may arise thereafter will affect that fact. Depositors can depend and rely on the protection afforded by the State guarantee up to now and into the future. This was under-scored yesterday with the passage of the guarantee scheme for a further 12 month period in national law to the end of 2011.
It is legitimate and appropriate for a continuing and vigorous public debate on the Government's banking strategy. However, it is incumbent on all of us as public representatives and those in positions of influence in the media and to public discourse generally to ensure that needless concern and anxiety is not caused to the public on the basis of spurious and often alarmist speculation. I have not found nor has any instance been reported to me of any spurious or alarmist speculation by Members. It is important that we reaffirm that deposits are guaranteed by the State and that the guarantee is underpinned by our membership of the euro, one of the strongest currencies in the world. I know Deputies have received individual queries about these matters, and this position must be maintained and constantly affirmed. As long as this is established, we can proceed with our debate in as vigorous a manner as we wish.
The common and agreed position of our eurozone partners is set out clearly in the statement issued by the euro group on Tuesday evening, which welcomed the significant efforts of Ireland to deal with the challenges it faces in the fiscal and financial sector areas and endorsed the budgetary strategy that will underpin the Government's four-year plan for returning the public finances to sustainability, which will be published by the end of the month. The euro group also welcomed the actions taken by the Government to date to seek to resolve our banking sector issues, including the guarantee and the policies of asset segregation through NAMA and capital investment in the banking institutions. However, it also acknowledged that notwithstanding these measures, market conditions have not normalised and significant pressures remain. This gives rise to concerns that further reforms and stabilisation measures for the banking sector may be appropriate. On this basis, the statement endorsed a short and focused consultation between the Irish authorities and the Commission, the ECB and the IMF to determine the best way to provide any necessary support to address market risks, especially in the banking sector, in the context of the four-year budgetary plan and the upcoming budget.
In any talks with the relevant authorities, the Government has acting on its behalf my officials at the Department of Finance, assisted by the National Treasury Management Agency. Naturally, the Central Bank, although independent in the operation of its functions, has a separate and distinct role in any discussions that take place by virtue of its unique position in our banking system.
The statement reflects the shared analysis of the Irish authorities and the euro group that further steps may be required in restructuring the Irish banking system to restore long-term market confidence in our banks and ensure they can function in the future without the need for continued significant Government guarantee supports or significant reliance on ECB liquidity facilities. The purpose of the technical discussions that are being initiated in Dublin today is to assess the possibility of building on the significant interventions already undertaken by the Irish authorities — the NAMA scheme, the Central Bank's stress tests, and the restructuring and recapitalisation — to secure an enduring and permanent resolution to the problems of our banking system. I welcome this morning's comments by the Governor of the Central Bank, who reiterated what I said about deposits and said that were the talks to result in the availability of a substantial contingency capital fund to back Ireland and create confidence in the firepower available but not drawn down by the banking system, that would be a desirable outcome. However, we are not at that point at this stage.
The job of Government is to protect the taxpayer. That is what we have been doing and what we are now doing. If the Government has been reticent in making public comment, it has been in the interest of protecting the taxpayer. Jumping to conclusions ahead of the facts is not to the benefit of the taxpayer, nor is it in our interest to do this in advance of the discussions that are now taking place. It is the Government's job to assess the options in light of the facts, and the facts can best be established after having a short and focused discussion. That is what the people would expect.
The international teams and our officials are working towards a common analysis of the problem. The problems we are facing do not relate to our budgetary position. Our budgetary strategy this year — to implement a €6 billion adjustment in the budget — has been fully endorsed by all finance Ministers in Europe, whether they belong to our group, the European Liberal Democrat and Reform Party, the European People's Party or the Party of European Socialists. There has been a unanimous endorsement at European level of what we are doing on the budgetary front. It is important to understand that the problems we are addressing are of a structural character in the banking system. They are, of necessity, technical issues requiring intensive discussions, which are now under way.
As I said yesterday, the Government and its EU partners are still examining options in terms of the shape a package of financial assistance might take. I am glad it was reported that I said, "There is no question of loading on to the Irish sovereign and the Irish state some kind of unspecified burden."