Full text of Government's statement on EU/IMF Bailout review - April 15, 2011

Posted on Friday, 15 April 2011

This is the information supplied by the Irish Government on the revisions to the EU/IMF Bailout negotiated at the end of the second quarter of this Bailout. It was supplied on April 15, 2011.

EU/IMF Programme of Financial Support for Ireland 

The Government has successfully concluded the first and second quarterly programme review mission with the EU Commission, the ECB and the IMF.

The purpose of the quarterly review mission has been to evaluate performance against targets to date on all the elements of the programme of financial support for Ireland including fiscal developments, the macroeconomic outlook, progress on commitments in the restructuring of the financial sector and structural reform. The Government is pleased that the staff mission has assessed the Programme to be on track and in their view the targets in the Programme have been met.

During this programme review, a number of Government members along with senior officials, have met with representatives from the EU, ECB and IMF (the external partners) and assured them of this Government’s commitment to the fiscal targets set out in the EU/IMF Programme. There have been several days of discussions at a technical and policy level and we have developed a good level of understanding between us about the plans and intentions of the new Government, and the needs of the Programme, and the Commission, IMF and ECB team have been helpful in their approach.

In the negotiations with the external partners, the Government set out measures that we would be seeking to include in the revised Programme. During the negotiations, it became clear that there was sufficient flexibility within the Programme to allow us to include these important policy measures, while respecting the overall fiscal parameters and goals of the programme. The revised Programme will now include these measures dealing with the Jobs Initiative, the minimum wage, the comprehensive spending review, amongst other measures (See Notes for Editors). The Government will constantly strive to ensure structural reform and competitive improvements in our economy.

There was also considerable discussion of our ongoing banking issues. The impact and importance of our recent PCAR/PLAR exercise and the restructuring of our banking system on which we are now engaged was fully recognized in the course of our discussions. But both we and our partners in this Programme understand the importance to maintain the momentum, to drive forward with the reforms, and to acknowledge and address issues that arise. We have made big progress on this in a short time and we must press on to complete the job. Yesterday’s reference to the High Court in relation to AIB Bank subordinated bonds is a case in point – we are already taking the actions we announced just a couple of weeks ago.

The Review will be formally completed with the consideration by Eurogroup, ECOFIN and the IMF Executive Board of the reports by their various staffs on progress to date – and the proposed amendments.   There is still some technical work and approvals required in relation to the review documentation. The final documents will be made publicly available when final approval occurs on 15th and 16th May. This will be followed by a Dáil debate on the Programme.