Government plans to return to bond markets next year

THE GOVERNMENT says it intends to return to the bond markets next year, despite an apparent suggestion to the contrary by Minister for Transport Leo Varadkar.

During a briefing to reporters in recent weeks, Mr Varadkar said when planning departmental spending for 2012 that he operated under the assumption it was unlikely the State could go back to the international markets next year.

However, his spokesman yesterday insisted Mr Varadkar had been speaking about a “hypothetical” situation in response to a query about available funding for transport projects.

“The Government position is that we would intend to return to the bond markets next year but obviously we would have to take account of the situation and the NTMA will advise accordingly,” the spokesman said.

Tánaiste and Minister for Foreign Affairs Eamon Gilmore yesterday said the Government was going to honour the terms of the agreement struck between the previous administration and the EU, ECB and IMF.

“There is no other position that would be responsible for the Government.

"We are not going to unilaterally default on that agreement. We are going to honour our commitments," he told RTÉ Radio One's This Weekprogramme.

Mr Gilmore said the Government had undertaken to renegotiate the agreement to bring it into line with the programme for government, having been highly critical of its terms.

He said the jobs initiative, which had not been provided for in the terms of the original agreement, had been introduced, and the cut in the minimum wage had been reversed.

Negotiations on the level of the interest rate on the bailout loan were under way currently, he said.

“It was never going to be the case that the renegotiation of the agreement was something that was going to be done in one great big bang. It was always going to be something that was done incrementally.”