Taoiseach criticised on interest rate hikes

TAOISEACH ENDA Kenny said he would discuss the recent European Central Bank interest rate increase with other European leaders.

He was replying to Fianna Fáil leader Micheál Martin who urged him to raise with other states the possibility of changing the legal basis underpinning the ECB to force it to give greater concern to economic growth and employment as well as inflation when making its decisions.

Mr Kenny replied: “The answer to the deputy’s question is yes.

“I will raise the matter, and it is important to be able to comment about the consequences of a bank that is independent.” The Taoiseach said comments had been made about the ECB and its functions in legislation in so far as it impacted on growth rates and economic development throughout European Union member states, with particular reference to the euro zone.

Those matters had been discussed “to a point” by the heads of government meeting in Brussels, and this would continue.

Mr Kenny said the increase was a matter of serious concern for those struggling to repay mortgages. “We are are all well aware of the numbers on tracker and variable mortgages and the difficulties they are now experiencing.”

He said Minister for Finance Michael Noonan was looking at the consequences of the increase for mortgage-payers and the fundamental responsibility of seeing that people had their homes protected and a conclusion was arrived at.

Mr Martin said during the recent election campaign the Taoiseach and his party had stated clearly that State-supported banks would be prevented from passing on interest rate increases such as those to mortgage-holders.

Mr Kenny said the Government had considered the overall banking position and made a decision which generated positive comment internationally.

“At last, the first decisive steps have been taken to provide a banking structure that works and we will move on to enabling banks to lend into the economy so business can be stimulated, growth fostered and jobs created,” he added.

Sinn Féin president Gerry Adams said the EU-IMF deal was a disaster for Ireland. “The deal and the international lending agreements which underpin it are good for the big bankers and their bondholders, but very bad for Irish taxpayers,” he added.

“However, at every turn, the Government recommits to this deal.” Labour Ministers, he said, were “briefing on more austerity policies, more cuts and more pressure on working people, public servants and the unemployed”.

Mr Kenny said the response internationally had been positive in respect of the Government’s decisions.