Bailout terms must be recast, Begg tells meeting

Sat, Apr 16, 2011, 01:00

CONGRESS RESPONSE:IRISH CONGRESS of Trade Unions general secretary David Begg has called for the State’s bailout deal to be renegotiated.

Mr Begg said the deal with the “troika” of the European Union, European Central Bank and International Monetary Fund had to be changed.

Addressing the annual conference of the Public Service Executive Union in Galway, he said congress had informed all three bodies that the deal was unsustainable for a country with a working population of 1.8 million.

The terms of the agreement meant that growth was being curtailed, domestic demand had collapsed and consumer spending was still falling, he said.

Doing nothing was not an option as the crisis was not going to be solved without intervention, he argued.

“Ireland has to fight for some justice. We cannot carry the burden of debt and austerity being laid upon us without serious damage to our quality of life and a generation lost to unemployment and emigration. Over half those unemployed are now in the long-term category.

“I think it is important to put the stress on renegotiation of the deal. Otherwise, sooner or later, we are heading for a disorderly default,” he said.

Mr Begg said representatives of the EU and ECB who were now dictating the terms of people’s lives in Ireland were not without responsibility for the Irish crisis.

“Be in no doubt that their primary objective is the protection of Europe’s banking system. Between them, German and French banks are exposed to the tune of €900 billion to the peripheral countries. These are the bondholders who cannot be burned,” he said.

Mr Begg said a renegotiation of the bailout deal was of the highest importance.

He said the pressure on domestic demand had to be eased because it was in the domestic economy that jobs would emerge.

While export-led recovery was also important, it would not create jobs in the numbers needed to make a dent in unemployment, he said.

“On Monday night we told the troika bluntly that they had no legal competence – not to mention moral authority – to interfere in the labour market, and to back off.

“We also told them that there are limits to the political acceptability of austerity and these limits are close to being exceeded.”