Dáil Éireann debate -
Wednesday, 25 Jan 2012

Vol. 752 No. 4

Leaders’ Questions

Deputy Willie O’Dea

As the Taoiseach will be aware, it will be several months before the full impact of the €750 million in health service cuts will be felt in each area. To date, 1,500 people have left the health service and a further 2,000 are due to leave before the end of February. In anybody's book that is quite an exodus. Of the 1,500 who have left, several hundred were front-line nurses, while 50 were full-time consultants. The Minister for Health has argued that changes to work practices will minimise the impact of the cuts. I am particularly concerned about cuts to maternity services. Is the Taoiseach aware of the concerns expressed by a number of senior medical practitioners about cuts to midwifery services, particularly in the mid-west region in which there is due to be an exodus of 25% of staff in February? Is he aware of the statement made by the senior consultant obstetrician in the region, Dr. Gerry Burke, who said:

No plans to deal with the shortfall have been presented by the HSE or the Department of Health. The shortfall of over 20 per cent of midwifery staff will diminish the quality of maternity care these women and babies receive.

Dr. Burke went on to state some of the women and babies to whom he had referred would pay with their lives. That is a serious assertion to make.

An Ceann Comhairle

A question please, Deputy.

Deputy Willie O’Dea

Is the Taoiseach in a position to provide the House with an assurance that the HSE and-or the Department have a contingency plan to deal with this issue? Will he assure us that the contingency plan is adequate and that it will be in place before the exodus to which I refer occurs at the end of February?

The Taoiseach

During 2011 the HSE established a system to identify and record the numbers of staff - approximately 2,100 - who were expected to leave before the end of what is known as the "grace period". The most recent information available indicates that in the period from September last year until the end of February next, some 3,500 staff will have retired from the health service. Approximately 1,500 retired during the four month period to the end of December 2011 and the remainder have indicated that they will leave by the end of February.

The comments made by Dr. Burke were outrageous. It was beyond the norm for a medical person of his stature to equate the process of staff legitimately leaving the health service under the programme with an attack - in the context of paying back money to German banks - on babies and pregnant mothers. I am aware of Dr. Burke's interest in serious health reform on which he has written many good articles during the years. Deputy Willie O'Dea who comes from the mid-west region will know that it is the Government's intention to restructure the health service in order that everyone will have access to services as close to home and in as efficient a manner as possible.

The Minister for Health approved the HSE's service plan in the past two weeks, with a contingency to the effect that the first review of the plan will take place at the end of February. The reason for this review is that the picture will become clear on the number who will have left the health service and also in respect of the categories and sectors they will have left. The Deputy can take it that the HSE has a contingency plan. However, it is not possible to determine the outcomes until we know the numbers of those who intend to leave. As the Deputy is aware, staff can decide to remain or leave right up to the deadline. Obviously, there will be pressure points. Where these will be will depend on the number of staff who leave, for example, the maternity service in the mid-west region or elsewhere. The Minister has made it perfectly clear that once the position on the numbers leaving particular sectors becomes evident, the plans of his Department and the HSE will come into play. We want to see a situation develop where all patients, be they young or old, will be given the best treatment which the medical services can provide.

Deputy Willie O’Dea

I am aware of Dr. Burke who the Taoiseach has just accused of making outrageous comments. I am also aware that Dr. Burke happens to be the chairperson of the Limerick branch of the Labour Party, Fine Gael's partner in government.

An Ceann Comhairle

It is completely out of order-----

Deputy Willie O’Dea

I am simply asking the Taoiseach-----

An Ceann Comhairle

-----to refer in the House to the politics of someone outside it.

Deputy Niall Collins

It is a statement of fact.

Deputy Willie O’Dea

Yes, and that fact has been highlighted in the newspapers.

(Interruptions).

Deputy Robert Troy

This is no laughing matter.

Deputy Willie O’Dea

Does the Taoiseach feel any sense of responsibility towards those who are suffering anxiety as a result of the cutbacks in maternity services? Is he aware that this is a matter of life and death?

Deputy Paudie Coffey

What is happening is a consequence of what those opposite did to the economy when they were in government.

Deputy Willie O’Dea

Will the Taoiseach provide a categoric assurance that the maternity hospital system in place after the end of February will be as safe as that in place?

The Taoiseach

I am well aware of the concerns expressed over a long period with regard to the inadequacies of the health service. I am also aware of the brilliant work being done by so many in pressurised front-line positions. In that context, when patients get into the system, they receive the best care and attention. We want to allow everybody to have the opportunity to receive such care and attention. That is why it is necessary to change the structures within the health system. The Minister for Health has set out the Government's intention to move, during its lifetime, to a universal health structure. This will not be achieved by clinging to an aspiration that the best care and attention can be provided in the absence of major changes.

When one considers the amount of money to be taken out of the health service over a period, one realises this is bound to have an impact. Of course, we are concerned about the level of care and attention provided for every patient, but the best service will not be achieved easily without making difficult choices on the structures that have to be put in place. I know Dr. Burke has written quite a few articles on changes to the structure and reform of the health service. However, government is about looking after the interests of everybody. This is challenging, but the Deputy can take it that the Minister who is a medical practitioner is conscious of the necessity to ensure the best care and attention is provided for every patient.

Deputy Gerry Adams

This is one of the Taoiseach's big days, the day on which he gives another €1.25 billion to bondholders, while imposing savage austerity on the rest of the citizens. He might be aware that during the general election campaign this bond traded for as low as 54 cent in the euro, presumably because the ratings agencies believed Fine Gael and the Labour Party would stick to their promise to impose burden sharing on senior bondholders. Of course, they are the insiders who know the inside track. The Taoiseach has proved them right and they will make a huge profit at the expense of citizens.

Dúirt An Tánaiste, an Teachta Eamon Gilmore, gur economic treason a bhí ann na scairshealbhóirí in Anglo Irish Bank a íoc. Cé hiad na scairshealbhóirí? Cén fáth nach dtugann an Rialtas na hainmneacha dúinn? An bhfuil eagla ar an Rialtas roimh saoránaigh agus an daonlathas? Will the Taoiseach name the bondholders? The Oireachtas and the people have the right to know who they are. Whether they are rural communities hit by septic tank charges, individuals hit by hikes in VAT, elderly patients, persons in maternity wards, the 500,000 unemployed or emigrants, every single citizen and the Oireachtas have the right to know the names of the bondholders to whom the Government is giving €1.25 billion of the people's money.

The Taoiseach

Ba mhaith liom a rá leis an Teachta nach bhfuil faitíos, scanradh, imní nó eagla ar an Rialtas faoin rud seo. Ba mhaith liom bheith in ann seasamh suas anseo agus a rá leis nach cóir go mbeadh an airgead seo le n-íoc, ach caithfear é a íoc. Níl slí ar bith eile as seo amach. Tá a fhios aige go raibh suas le €97 billiún le n-íoc i 2008. Níl fágtha faoi láthair ach €2.6 billiún. Tá an airgead seo le n-íoc ar maidin.

We had this out yesterday in advance of what the Deputy calls my big day. I do not like to see a situation where this repayment has to be made to bondholders. I do not have a list of their names, but I am sure the names of those in possession of the bonds have changed often since they were first acquired. However, I would like to repeat what I said yesterday. The Deputy seems to consider that there is an alternative, but if we do not pay this money, he has failed to point out from where the moneys to provide services for the people in the Visitors Gallery and throughout the country would come. He is aware that we have received €110 billion for the covered banks at very low interest rates to keep the country moving. The challenge for the Government is to sort out the public finances, close the deficit, grow the economy and provide jobs and opportunities for people here at home. The Deputy's idea that the Government can state it will not pay is simply nonsensical.

The Minister for Finance returned yesterday from Frankfurt having spoken to Mr. Draghi of the European Central Bank. The challenge and opportunity under discussion is to have flexibility shown by our European colleagues towards the promissory notes which will require a €3 billion payment in each of the next ten years. Flexibility is of great importance to Ireland. These discussions are under way in the same way that there were discussions on a reduction in the interest rate charged which, according to some commentators, was never going to happen.

It is not easy to say this, but the money must be repaid. The alternative would be catastrophic, given what has happened in Greece, where 100,000 public servants have been let go, public sector salaries have been drastically reduced and services decimated. We cannot and will not allow that to happen here.

There are some signs of some confidence returning. Yields of 6% yesterday indicate growing interest and confidence in the international community in investing in this country. We have a very long way to go, but we have been pointed in the right direction.

Deputy Gerry Adams

The Taoiseach says he does not know the names of the bondholders. With respect, that is not good enough. It is a disgrace. He says we say there is another way. That is correct; we believe there is another way. What happened to the five point pln and promise of openness when in government? The deference the Taoiseach shows to the bondholders contrasts sharply with the Government's attitude to citizens. We heard yesterday from Dr. Gerry Burke, a consultant obstetrician in Limerick, who warned that the loss of 47 midwives in the mid-western regional maternity hospital in Limerick next month might cost lives. Ministers wax lyrical about the awful consequences if we do not pay the bonds. Do they give any consideration to the social consequences?

This morning I wrote to the Comptroller and Auditor General, asking him to investigate these payments, to whom they will be made, the profits to be made and whether he considers this to be an appropriate use of public funds. The Tánaiste, Deputy Eamon Gilmore, said, "If the Taoiseach's Government knew that Anglo Irish Bank was insolvent and asked the Irish taxpayer to bail it out and pay the cost we are now paying for it, that was and is economic treason. I stand over that." Does he still support that proposition? Will the Taoiseach find the names of the bondholders before we have to search to establish who they are?

Deputy Bernard J. Durkan

Does the Deputy want to visit them?

(Interruptions).

The Taoiseach

Deputy Gerry Adams is a great man to come here and talk about openness, transparency and accountability. There were many occasions when he was not so open in his comments. I do not have a list of the bondholders.

Deputy Gerry Adams

Why not?

The Taoiseach

Because I do not have one. Many of the names would have changed during the years.

Deputy Aengus Ó Snodaigh

That is absolutely incompetent.

The Taoiseach

Deputy Gerry Adams is the person who said that when he was elected to the Oireachtas, he would tell the troika to take its money with it. However, he has refused to tell the public how he would propose to deal with the consequences of that action. The ECB has advanced €110 billion to keep services in this country going. The Deputy has failed to point out how he would pay teachers, gardaí and nurses and fill ATM machines to keep the economy moving. I do not have access to a list of the names of bondholders. The bigger benefit to the country lies in supporting the Government in explaining to our European colleagues that showing greater flexibility in our meeting a promissory note of €30 billion over a period of ten years would bring great benefit to every citize. If we can arrive at a successful conclusion to these discussions, it will have an impact on the deficit and make it easier for us to repay our debt. Ireland is heading in the right direction. This is not easy; it is very challenging and impacts on services. We must make choices as to how we will maintain front-line services to the best of our ability. Deputy Willie O'Dea asked a legitimate question about maintaining such services.

This is why when the number of people who will leave at the end of February becomes known-----

Deputy Gerry Adams

The money the Government is giving away today would pay for all those health deficiencies.

The Taoiseach

-----the pressure points will then be determined and the plan will be put in place to deal with them. For now, you continue with the same old rant about not paying and opposing. Is there not some place in the life of Deputy Gerry Adams where he can say here is the way forward with confidence.

Deputy Gerry Adams

Yes, we gave it to the Taoiseach yesterday.

The Taoiseach

This is being expressed by the international community with yields on the secondary markets at 6%.

Deputy Gerry Adams

We gave it into your hands yesterday.

The Taoiseach

This is where they were before the bailout. If this country can keep heading in the right direction when we get to the end of our programme we will have an engine on which we can fly with our own economic independence.

Deputy Gerry Adams

A bird never flew on one wing.

Deputy Bernard J. Durkan

The Deputy had a fair number of wings.

Deputy Shane Ross

This is a dark day for Ireland by any measure. Whatever the Taoiseach's likes and dislikes about what is happening, it is a dismal day when we must hand over €1.2 billion. My concern is with regard to the Government response to legitimate criticism on what it is doing today which is, after all, implementing the policies of the previous Government. The scare tactics used in response to the criticism in the past week have not contributed constructively to the debate. The Tánaiste spoke of not being able to pay gardaí, nurses or teachers. The Minister for Transport, Tourism and Sport spoke of a financial time bomb going off in Dublin. Let us have a legitimate argument about this.

I understand the Taoiseach's insistence and argument that his priority is to return to the bond markets as early as possible and say goodbye to the troika. This is a legitimate aim. However I wish to point out something to him and ask him whether he has considered it.

An Ceann Comhairle

Perhaps you will ask him a question please.

Deputy Bernard J. Durkan

It is better; you will get more information.

Deputy Shane Ross

Yes, thank you.

An Ceann Comhairle

He answers the questions and you ask them.

Deputy Bernard J. Durkan

He was doing well.

Deputy Shane Ross

Why does the Taoiseach insist on not considering the write-off of debts? Why does he not examine the example of Russia which returned to the bond markets in two years-----

Deputy Paschal Donohoe

At double the interest rates.

Deputy Shane Ross

-----or Iceland which returned recently and Argentina? All of these wrote off their debts and returned to the bond markets.

Deputy Derek Nolan

Their economies collapsed.

Deputy Arthur Spring

Take a look at Argentina.

Deputy Finian McGrath

Denmark, Paschal.

An Ceann Comhairle

Please.

Deputy Finian McGrath

Leo got it wrong last Sunday.

Deputy Jerry Buttimer

It is back to voodoo economics over there.

Deputy Shane Ross

Why does the Taoiseach not look at the history of the markets which forgive those who write off their debt provided the future looks bright enough for them to lend?

An Ceann Comhairle

The Deputy is over time.

Deputy Shane Ross

The idea of default being a taboo is not acceptable.

Deputy Paschal Donohoe

They are still paying back their debts.

The Taoiseach

Yesterday or the day before I described Deputy Ross as a respected economist but now I am not so sure.

Deputy Bernard J. Durkan

I am not too sure about the economy bit.

Deputy Michael Healy-Rae

He put you up to pull you down.

The Taoiseach

It seems as if the Ross theory of economics means at the stroke of a pen a member of the single currency area, in this case the Irish Central Bank, should be able to create new money to pay off the debts of Anglo Irish Bank and make those debts disappear like magic. This type of airgead draíochta is not around. It is the formula which caused the monetary chaos and economic collapse of the post-Soviet Union rouble zone in the early 1990s. This year we must take €3 billion out of the Irish economy. Deputy Ross's formula is to deal with the deficit of €16 billion in one fell swoop. Does he seriously consider that something of this magnitude could be done without catastrophic consequences for the ordinary citizens of the country?

Deputy Bernard J. Durkan

Here, here.

The Taoiseach

What is at stake here is what provides the greater benefit in the interest of Ireland and its people. Given the extent of what has already been paid in respect of Anglo Irish Bank - Deputy Ross made recommendations about people associated with it and their stellar performance - what is left means the greater benefit is in following the route of explaining to our European colleagues the very onerous burden on the Irish taxpayers with regard to the promissory notes. This conversation has started and has been enhanced by the troika itself making a proposal to the Minister for Finance, Deputy Noonan, and the Minister for Public Expenditure and Reform, Deputy Howlin, that they should prepare a paper. Yesterday's conclusion was that this is worth pursuing. The greater benefit to Ireland, our economy and our taxpayers is to be able to get greater flexibility with regard to the fiscal burden of the promissory notes.

Were we able with co-operation and consent to shift the burden into the facilities now available through the EFSF or the ESM it would greatly reduce our deficit and make it much more manageable to deal with our debt. This would also be in the interest of Europe in that it would see a country in a bailout programme having made and risen to very serious challenges coming out of the programme thereby proving that where people, government and Europe work together the economies of the European Union as a whole can grow.

Deputy Shane Ross

I thank the Taoiseach for the compliment he paid me last week about my forecast on the economy. I would like to mention something to him in response. It was in the same breath that he told us last week he stuck soundly by the growth rate of 1.3% for this year, the day after his heroes in the troika-----

An Ceann Comhairle

Does the Deputy have a question?

Deputy Shane Ross

-----said 0.5%. They halved it. Does the Taoiseach still stand by the 1.3% he stuck to this time last week? Nobody else does. Let us argue the toss on this one.

An Ceann Comhairle

No we will not. The Deputy must ask a supplementary question.

Deputy Shane Ross

I am sure we will not. I will ask the Taoiseach a supplementary question. It is a serious question and I would like him to answer it. Is the Minister for Finance in his negotiations with the European Central Bank and Olli Rehn intent on focusing simply on the terms of the Irish sovereign debt or is he prepared to look at, and is he looking for, a write-off of some of the substantial capital?

Deputy Olivia Mitchell

We are still borrowing.

Deputy Finian McGrath

Do not forget the growth rates.

The Taoiseach

I expect to do much better than 0.5%.

Deputy Shane Ross

Is the Taoiseach still on for 1.3%?

The Taoiseach

I expect we can achieve the 1.3% we have set out. It is a medium-term figure. Some said higher and some said lower. I am quite prepared to stand by the figure we have set out.

Deputy Finian McGrath

The Taoiseach was wrong last week.

The Taoiseach

As a respected economist, Deputy Ross-----

Deputy Shane Ross

No, I am not.

The Taoiseach

-----will understand growth figures depend on a range of issues. Even Deputy Ross with his long-range spectrum is unable to determine what the growth figures for any individual country might be in the future.

The Government has not looked for any write-off and is not looking for a write-off. We have paid our way and will pay our way. The Minister has been very careful and clear to point out we are now involved in a process of discussion with the ECB and our colleagues in Europe to get greater flexibility with regard to the promissory notes which will cost €3 billion per year for each of the next ten years. This would be of enormous benefit to our economy and our taxpayers. This process is now in train and is enhanced by the proposal from the troika itself that the Ministers here should prepare a paper. When this paper is presented it will have the status of a troika paper. In the meantime the Irish Government and officials from the Department of Finance will engage in technical discussions on what it entails in so far as our colleagues are concerned.

There is no question of seeking a write down. There is a question of discussion and negotiation about the facility and the greater flexibility that could be shown to us in getting the EFSF and the ESM facilities applied to the extent of borrowing for a bank re-capitalisation before the country entered into the bailout. This is the position and the discussion is now under way.

It is not down for decision on Monday or at the next Council meeting, but it is one in which we are involved with our colleagues. If we could bring it to a conclusion, it would be of great benefit to the taxpayer, the economy and the country.