Dáil Éireann Debate, Wednesday - 22 May 2013
79. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Question No. 219 of 23 April 2013, and further to his statement on 13 May 2013 that it seems to me that if we had one more sale of Irish paper, we would be eligible for outright monetary transactions scheme, if he will outline his basis for believing this to be the case and the reason he does not believe we would be eligible for access to OMT presently. [24696/13]
View answer80. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Question No. 219 of 23 April 2013, and further to his statement on 13 May 2013 that we have not decided in Government yet whether we will apply or not for the Outright Monetary Transactions scheme but it is something that seems to be a mechanism that is working very well and it might be something that we would want to avail of coming out of the bailout, if he will outline the way the OMT mechanism is working and the volume and value of OMT transactions undertaken by the European Central Bank. [24697/13]
View answer81. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Question No. 219 of 23 April 2013, and further to the publication on 14 May 2013 by the National Treasury Management Agency of its May 2013 presentation to investors which includes the statement clarity on Ireland's eligibility for ECB’s new Outright Monetary Transactions, OMT, would be helpful to underpin sustainable market re-entry; his views on whether there is a lack of clarity on Ireland’s eligibility for the ECB’s OMT scheme. [24698/13]
View answerI propose to take Questions Nos. 79 to 81, inclusive, together.
The Governing Council of the ECB made a decision to establish Outright Monetary Transaction (OMT) on 2 August 2012, and issued a Press Release on 6 September 2012 which outlined its technical features. According to this ECB Press Release, the purpose of OMT is “Safeguarding an appropriate monetary policy transmission and the singleness of the monetary policy”. In the Press Release, the ECB noted in relation to the coverage of OMT that it “will be considered for Member States currently under a macroeconomic adjustment programme when they will be regaining bond market access.” The Press Release also sets out that a necessary condition for OMT is strict and effective conditionality attached to an appropriate European Financial Stability Facility/European Stability Mechanism (EFSF/ESM) programme.
Such programmes can take the form of a full EFSF/ESM macroeconomic adjustment programme or a precautionary programme (Enhanced Conditions Credit Line), provided that they include the possibility of EFSF/ESM primary market purchases. Finally the Press Release also notes that the ECB’s Governing Council will decide on the start, continuation and suspension of OMT, following a thorough assessment, in full discretion and acting in accordance with its monetary policy mandate. The reply to PQ No 219 of 23 April 2013, to which each of the three questions refers, states clearly that the decision on whether to grant OMT or otherwise in any particular case is a matter for the ECB, which is an independent body.
My recent comments about a further sale of Irish paper were referencing primarily our progress in establishing full market access.
In relation to the NTMA, I understand its comment on clarity in relation to Ireland’s eligibility for OMT to be its assessment of the view of the financial markets that such clarity would be helpful.
All relevant options will be considered in the light of what will be appropriate for Ireland at the time of our Programme exit. The issue of our exit options has yet to be fully considered by Government and accordingly no decisions have been taken to date.
