independent

Wednesday 16 April 2014

EU fund chief dashes hopes of bailout refund

The head of the EU's new bailout fund has poured cold water on hopes of recovering some of the crippling cost of bailing out the banks.

Klaus Regling, managing director of the European Stability Mechanism (ESM), claimed there was a "general reluctance in a number of countries to provide financing retroactively" -- setting back hopes the Government would be able to tap the ESM fund.

Ireland's bid to get EU help for €30bn of bank bailout debts was, however, backed by the chairwoman of the European Parliament's economic committee.

Sharon Bowles was leading a delegation of MEPs visiting Ireland as part of an investigation into the operations of the EU-IMF troika bailout.

"The Irish taxpayer took on extra debt for the benefit of the rest of the EU and this has subsequently been shown to be a wrong call," she said.

Mr Regling, in Dublin for talks with Finance Minister Michael Noonan and Central Bank governor Patrick Honohan, said the money markets were rewarding Ireland with a reduction in borrowing costs because it didn't burn senior bondholders.

Mr Noonan, however, said the Government was not "flying on one wing and simply waiting for European assistance".

Meanwhile, Social Justice Ireland told the MEP delegation the austerity approach was unethical because poor and middle-income people had borne the brunt of the cuts.

Irish Independent

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