No bank deal until 2013, says Kenny
Taoiseach Enda Kenny has said there will be no bank debt relief deal before the end of the year, quashing any remaining expectation of a breakthrough before Budget day next month.
In Brussels today, Mr Kenny replied in the negative when asked whether there might be a deal at the next EU summit on December 13th.
“The situation is that there will not be a decision on this before the next Council meeting and before the end of the year,” he told a lunchtime audience at a German think-tank.
The Taoiseach’s remarks, on the fringes of the summit on the new EU budget, make it clear that Minister for Finance Michael Noonan will have to formulate the Budget without any allowance for debt relief.
Last week Mr Noonan left open the possibility of a pre-Budget agreement with the European Central Bank to recast the Anglo Irish Bank promissory notes.
Mr Kenny said the leaders of Germany and France had agreed that Ireland was a “special” case, adding that the Government hoped to bring the debt relief question forward in talks on a euro zone “banking union”.
“We hope that during the course of 2013 our Minister for Finance will progress in that understanding and that decision, and \[that]\ it will be recognised in those discussions,” the Taoiseach said.
He also cited support from the members of the EU-IMF troika. “I hope that being serious ourselves, and proving that we're serious as we manage to move towards an exit of this bailout, that assistance will give us extra help.”
Earlier, Downing Street said there is “a long way to go” before EU leaders at a special summit in Brussels can agree a long-term budget. The comment came today following a meeting between David Cameron and European Council president Herman Van Rompuy.
Mr Cameron was the first of the EU’s 27 national leaders to meet summit chairman Mr Van Rompuy and European Commission president Jose Manuel Barroso ahead of what are expected to be marathon negotiations beginning this evening in the Belgian capital.
Arriving in Brussels early today, Mr Cameron insisted that any rise in European Union spending was “quite wrong” and said he would be fighting “very hard” to secure a good deal for British taxpayers and to keep the rebate negotiated by Margaret Thatcher in the 1980s.
Mr Cameron is calling for a real-terms freeze, or even a cut, in the budget for 2014/20 - the sole subject on the agenda for the summit which starts tonight and may run into the weekend.
Taoiseach Enda Kenny is set to align himself with French president François Hollande in an effort to defend Ireland’s share of EU agriculture funding at the talks.
Despite weeks of gloom over the prospects for a deal on a new seven-year spending plan, official sources are reporting a slight pick-up in sentiment about the prospects for the summit.
“There has been a certain increase in optimism over the last couple of days. The pendulum has swung in the direction of greater optimism but we’re still a long way from certainty,” said a senior European diplomat.
The talks on a package worth some €1 trillion come amid pressure for budget cuts as a result of the economic crisis, threatening allocations for agricultural and cohesion policies. Mr Kenny aims to maintain Ireland’s share of funding in each of these areas.