Fine Gael rules out support for Government’s ‘fiasco’ economics

NEW Fine Gael finance spokesman Michael Noonan has firmly ruled out supporting the Government on economic policies.

Mr Noonan said there was no basis for a cross-party deal as the Government had no actual policies to support.

“This Government isn’t bringing forward any policies whatsoever,” he said.

The Limerick TD claimed the Government had made “an absolute fiasco” of the bank rescue. In addition, unemployment was at its highest level in the history of the State with little sign of a Government plan to tackle it, he said.

“There is no basis for a cross-party deal as they have no policies to underpin it,” Mr Noonan told RTÉ.

He conceded, however, that Fine Gael would have to continue with the bank rescue plan and the National Asset Management Agency were the party to win power.

Once a bank restructuring plan goes a certain distance, “it becomes irretrievable”, he said. “And for better or for worse, we’re stuck with NAMA now.”

It emerged yesterday that NAMA admits it could make losses. When the agency was established last year to relieve the banks of their high-risk property loans, the Government bullishly predicted it would turn circa €4.8bn in profit over time once it had worked through the loans or sold the assets underpinning them. But it was reported that NAMA’s new business plan, which is expected to be published this week, acknowledges that losses are a possibility.

This is because the percentage of the loans assumed by NAMA which are actually being repaid is far lower than originally anticipated.

As a result, the business plan points to three possible outcomes – a profit of circa €2bn, a profit of a few hundred million, or losses of a few hundred million.

Mr Noonan said the fact that losses were only now being realised as a possibility was the direct result of NAMA being misled by the banks at the outset.

“If you look back on what has happened over recent years, the banks misled their shareholders, the banks misled TDs and Dáil committees, the banks misled the Government, the banks misled the public and now in NAMA, they’re misleading them again,” he said.

But Finance Minister Brian Lenihan said NAMA incurring losses was at the “extreme end” of possible outcomes.


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