Dáil Éireann Debate, Tuesday - 29 January 2013
284. Deputy Michael McGrath asked the Minister for Finance if he has held discussions with the ECB in respect of the disbursement of profits on its purchase of Government bonds under the securities markets programme including the possible disbursement of these profits solely to Ireland as the ECB has agreed to do in the case of Greece; and if he will make a statement on the matter. [4548/13]
View answerThe recently agreed package of measures for Greece is designed to help put its economy on a path to sustainable growth and its domestic finances on a sound footing. This package was agreed in the context of the statement by Euro Area Heads of State or Government that the scale of the Greek problem is so large that it requires special attention. In this regard, on November 26th euro zone Finance Ministers agreed to partly reschedule Greece's debt, and offered several other measures to alleviate the country’s financial burden. Taken together, these actions are expected to cut Greece's debt by up to 20 percentage points of GDP by 2020. This will bring its debt to GDP level to 124% in 2020, and a debt to GDP level of below 110% is targeted for 2022.
One of the measures agreed, the Securities Market Programme (SMP) measure, will see Member States pass on to Greece's segregated account, an amount equivalent to the income on the SMP portfolio accruing to their national central bank as from budget year 2013. Member States under a full financial assistance programme are not required to participate in this scheme for the period in which they receive financial assistance. It is important to note that the SMP measure involves a transfer of an accounting profit, but does not involve any retirement of debt by Greece. It is also important to note that the concessions that have been agreed are specific to Greece and are accompanied by significant additional conditionality.
In Ireland, on the other hand, we have entered the final year of our programme and our focus is on making a successful exit from the programme. In line with the EU Heads of State or Government commitments in June, discussions are also underway to further improve the sustainability of Ireland’s programme. These discussions include our continuing interaction with the EU, the ECB and the IMF (the Troika) on exiting the programme and issues related to our banking debt, including the restructuring of the promissory note.
Ireland’s needs, as a country exiting a programme, are very different to those of Greece. We are, however, examining the Greek package to see if aspects of it offer any possible benefit to Ireland, particularly in the context of our programme exit. We will also be engaging on this issue with the Troika officials as part of the 9th review mission which started earlier today. The decision on the measures, if any, to be sought will be taken on the basis of this examination.
