PRESS CONFERENCE:FINE GAEL'S alternative budgetary plans would reduce the Government deficit by €15 billion over the next four years, and would also create 100,000 new jobs, party leader Enda Kenny said yesterday.
Fine Gael shares the Government’s view that €6 billion in adjustments must be made in 2011, but has differed on the detail and its identification of priority areas.
Both Mr Kenny and Fine Gael spokesman on finance Michael Noonan argued yesterday that the party did not wish to alter income taxes or impose property taxes that were as high as the Government’s proposals in its four-year plan. They said they would instead, among other things, target cuts in public sector numbers and its pay bill.
Mr Kenny said a key element of the document was its strategy for jobs and growth, a strategy that was absent from the Government’s document.
He confirmed that the party would seek to utilise the residual €6 billion in the National Pension Reserve Fund, as well as the proceeds from the sale of (unspecified) semi-State companies, to fund these measures over four years.
Mr Kenny said the IMF’s intervention in Ireland had “put the country into kindergarten” as the agency now had wide powers of oversight of the Irish economy.
He said that, contrary to recent comments, he did not believe the country was “banjaxed”.
Mr Noonan said political independence was futile for a country unless it had economic independence. “The task of an incoming government is to rebuild economic independence again. It is going to be a tough period.”
He said unless it was accompanied by a jobs and growth strategy it would not achieve the goals that would get us out of our difficulties.
Mr Noonan also disclosed that Fine Gael in government would insist that unsecured senior bond-holders in Anglo should be burned when the bank was wound down.
Mr Noonan said he understood from senior sources in the EU involved in the negotiations with the Government that once Anglo ceases to have a bank licence, burden-sharing by its senior bondholders would become a reality as it would not longer be considered capable of having a contagion effect. The senior source had strongly suggested that the veto exercised by the EU on burden-sharing by senior bondholders would be less strong if Anglo was no longer licensed as a bank.
The Department of Finance refused to comment on the issue last night.
If Anglo were to lose its licence, a resolution would be necessary with senior bondholders. One source said last night that trying to impose burden-sharing could prove legally problematic.
Mr Noonan said Bank of Ireland was in the best position to recapitalise and it should enter into negotiations with bondholders. “As regards AIB, they should be directed to negotiate with subordinate bondholders.”
Mr Kenny said he believed the Government would have sufficient Dáil numbers to get the budget passed on Tuesday.
“I believe they will pass it without our help.”