Wednesday 21 March 2018

EU chief's backing a boost for bank-debt deal hope

Fionnan Sheahan and Donal O'Donovan

IRELAND has received a morale-boosting vote of confidence from the leader of the European Parliament -- who believes we should get a deal on our bank debt.

Europe's top MEP, German Martin Schulz said EU leaders should keep their word and give us a new deal before the end of the year and the start of our EU Presidency.

In an upbeat address to a half-full Dail, the European Parliament president also criticised the requirement for governments to submit draft budgets to civil servants in Brussels before being announced at home.

Although he represents the European Parliament, Mr Schulz has little power to influence a deal.

However, his comments will be seen as a vote of confidence in how the Government is dealing with the debt crisis.

He said he believes the EU had to keep the promises on bank debt made to Ireland in June. "I believe the Irish programme should be adjusted before the end of the year along the lines of the June European council conclusion," he said to applause.

Taoiseach Enda Kenny said the commitments made at the EU leaders summit in June needed to be implemented.

"Ireland will do everything it can to secure its economic recovery. But we cannot do it on our own," he said.

Mr Schulz said he wanted to see the debt deal struck before Ireland's EU Presidency begins on January 1.

The German Socialist MEP said EU leaders had to keep their word.

"Either we all lose or we all win," he said.

Mr Schulz's comments come in the wake of doubts being cast over a bank debt deal after a statement last week from the finance ministers of Germany, the Netherlands and Finland.

The three ministers said the new EU bailout fund should not deal with legacy debt.

Mr Schulz's speech marked the first time a president of the European Parliament addressed the Dail.

"The biggest risk for Europe is the lack of mutual trust. How can we regain the confidence of our citizens if the highest European body, the council of heads of state of government, is not reliable?" he said.


"We will never regain the trust of our citizens if we do not stick to our promises. After all Ireland got into trouble because it took over the debts of its banking system," he added.

Mr Schulz is the leader of the Party of European Socialists in the European Parliament -- the group to which Labour MEPs are affiliated.

He said the Irish taxpayer was paying the bankers' bills "to stop a domino effect" that could have dragged the whole European banking system down.

"And therefore solidarity with Ireland is to give something back. You took the burden on your shoulders to avoid the crash of the system of all the other countries, also my country," he said.

The European Parliament president said it was not democratic for governments to have to submit their budgets to the European Commission in Brussels before they were announced in the national parliament.

But he also called for the introduction of a financial transaction tax, which the Coalition is opposed to. The Government believes the FTT would hit our coveted financial sector, particularly the IFSC, which employs about 20,000 people.

Meanwhile, European Central Bank (ECB) President Mario Draghi was tight-lipped on the bank debt negotiations with Ireland at a press conference in the Slovenian capital Ljubljana.

There was no comfort on the economic front either, with Mr Draghi warning that economic growth will remain weak in the eurozone.

This week, European Commission president Jose Manuel Barroso gave his own assurances to Mr Kenny that leaders would stick to a June agreement on separating bank and sovereign debt.

Irish Independent

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