Government denies Noonan misled Dail on burning bondholders

Social Democrats deputy Stephen Donnelly calls for Minister for Finance’s resignation

Government speakers denied Minister for Finance Michael Noonan had misled the Dáil on the attitude of European Central Bank president Jean- Claude Trichet to Ireland burning senior bondholders.

They were replying to Social Democrats TD Stephen Donnelly, who called on Mr Noonan to resign. Mr Donnelly said the Government had been elected on a clear mandate to burn the bondholders.

“It appeared, it tried, was threatened and made a certain decision. If the Minister for Finance feels he can walk into the House and deny those threats were ever made, we have a serious question,” he added.

He said the Oireachtas banking inquiry report had said the withdrawal of emergency liquidity assistance was used as an explicit threat to prevent the Government from imposing losses on senior bondholders in March 2011.


There was an explicit threat from Mr Trichet that a "bomb" would go off in Dublin.

Misleading the Dáil

Mr Donnelly said on the following November he had asked Mr Noonan in the House if any threats had been made and the Minister had replied that none had. This was unambiguously misleading the Dáil on a matter of national importance, he added.

He said he had no doubt Fine Gael would brush aside his claim as semantics or whatever. There was no political accountability, he added.

Minister of State Damien English said Mr Noonan had set out to the banking inquiry that Mr Trichet was clear and spoke in graphic terms of what he saw as the consequences of Ireland's burden-sharing with senior bondholders.

Mr Noonan had said Ireland would be treated as a country in default and a bank would be treated as a bank in default. Emergency liquidity assistance could be suspended; it was always temporary.

“To be very clear, there was no U-turn on the Minister’s part,” Mr English added.

Economic historians




Pat Rabbitte

, in his final Dáil speech, said the inquiry had done the State some service, for which future economic historians would be grateful.

“I remain convinced any parliament that does not have the right of inquiry by parliamentary committee into legitimate matters of public interest is a diminished parliament,” Mr Rabbitte added.

“Properly organised and conducted, it is a natural extension of parliamentary oversight and would improve the performance of government.”

Independent TD Shane Ross said, while he shared the tributes to the inquiry members for their hard work, they were utterly hamstrung in what they could produce.

The happiest people were those who were being, or meant to be, asked the hard questions, he said. The report, he added, was “a get-out-of- jail card” for the bankers, who were rejoicing because it could not find fault with them.

“They could come in, answer the questions and, in effect, get a clean bill of health because no finding of fact could be made against them.”

Michael O'Regan

Michael O'Regan

Michael O’Regan is a former parliamentary correspondent of The Irish Times