Taoiseach increases demands on bank debt

Kenny, Cameron to review progress on British-Irish relations

Mon, Mar 11, 2013, 19:07

Taoiseach Enda Kenny has toughened Ireland's demand for concessions from the European Union on the debts sustained by the Irish taxpayer from the banking crisis.

"The principle that there can be no shared European taxpayer responsibility for banks without shared control and supervision is reasonable," he said in a speech in the Mansion House in the City of London this afternoon.

"But the corollary must also be true; where the policy for dealing with bank failures was determined at European - and not national - level, so too must the burden of the legacy costs of those policies.”

Mr Kenny, who met British prime minister David Cameron at Downing Street this afternoon, argued that Irish banks “need to accelerate the work-out of mortgage arrears and other non-performing loans”, saying that he hoped for progress on th e issue this week.

Such changes, he said, would “give confidence to investors and visibility and hope to the tens of thousands of families and small businesses in debt difficulties”.

Mr Kenny said Irish banks need to cut their costs, he went on, while 'after a decade of a property boom and bust, there is a need for the banks to re-skill in order to improve their ability to lend prudently into the real economy'.

Earlier, Mr Kenny had strongly supported the United Kingdom's continued membership of the European Union, just hours before meeting prime minister David Cameron.

"We see the British relationship with the EU as being a two way relationship - Britain benefits from its membership of the EU, and the EU is better off with Britain as a leading member making a valued contribution," he said before the talks at Downing Street.

Mr Kenny said the UK's membership benefited Ireland, too. "Having the ability to work together within the European Union on the many issues on which we are of like mind - the single market, trade and so on - amplifies the impact of our excellent relationship generally," he said.

"Both our economies are closely tied in so many ways and we want this close relationship to continue and be built on for many generations to come," he said, in a speech in the Mansion House in the City of London this morning.

"Britain remains Ireland's largest export destination and Ireland is the 5th largest recipient of British exports. While we have individual areas of expertise, when it comes to exports we have shared strengths in sectors such as financial and business services," he added.

Referring to the Irish banking crisis, he said: "Following years of reckless lending, Irish banks were bailed out at a cost of ¤64 billion to Irish taxpayers - equivalent to over 40 per cent of GDP or ¤35,000 for every household in the country - and over ten times the cost of bank rescues in any other euro zone country.

"If it hadn't been for this uniquely onerous burden, Irish public debt levels would now be below the euro zone average," said Mr Kenny, who will address the British-Irish Chamber of Commerce later before going to No 10.

The meeting at Downing Street will be the first annual summit to review progress on the statement the two leaders signed last year on developing British-Irish relations in a range of key areas over the next decade.

They will also discuss the current situation in Northern Ireland, some 15 years on from the signing of the Belfast Agreement.

Mr Kenny will also brief Mr Cameron on the progress and remaining priorities of Ireland’s EU presidency, which ends in June.

Mr Kenny told the Dail last month he would raise Marian Price ’s situation in Maghaberry prison with Mr Cameron.

The one day visit to London is the start of a period of intensive promotion of Ireland abroad by the Taoiseach, both before and after St Patrick’s Day.

Following the Downing Street meeting, the Taoiseach will attend the Champ St Patrick’s Day reception sponsored by Tourism Ireland at the Houses of Parliament, Westminster.

Champ is a not-for-profit organisation which promotes peace in Northern Ireland, and throughout Ireland and the UK.