Taoiseach rejects RTÉ claims about IMF

TAOISEACH Brian Cowen was forced to deny reports yesterday that he had said Ireland might have to call in the International Monetary Fund (IMF) to solve the country’s financial crisis.

At a Tokyo news conference Mr Cowen was asked if recent comments by senior trade unionist Tom Murphy — that the IMF could be called in to sort out our troubles — reflected the reality facing the economy.

He did not deny Mr Murphy’s warning, adding that his remarks were based on the briefings the social partners had been given by the Government when it outlined the seriousness of the current crisis to the trade unions recently.

“The comments he has made are based on the evidence produced by the Government in our discussions with the trade unions,” the Taoiseach said.

Later Mr Cowen told Reuters News Agency “I never said that” and his denial helped stabilise the euro which had fallen by more than a cent against the dollar.

The Government also issued a statement in Dublin on the Taoiseach’s behalf.

Mr Cowen is on a six-day trade mission to Japan.

Traders blamed the euro’s fall on the alleged statement by Mr Cowen.

RTÉ had reported on its early news broadcasts and website that: “Brian Cowen has confirmed that the International Monetary Fund could be called in if the economy continues to worsen.” However, it was forced to issue a clarification by mid-morning.

Mr Cowen did not say that the monetary body could be imposed on Ireland if not enough cuts were made to sort out our financial troubles, but his failure to deny the trade unionist’s comments had left the issue hanging.

Mr Murphy confirmed yesterday that the Taoiseach did not mention the IMF and said he had “concluded himself” that the IMF could be called in under certain circumstances.

The Government is facing a borrowing requirement of €20bn this year due to the tax shortfall and a doubling of its debt/GDP ratio to over 40% and Standard and Poor’s has warned the country’s credit rating could be cut.

“I think he [Mr Murphy] was referring to the previous experience in the 1980s when determined corrective and timely action was the means by which our prosperity was regained and sustained,” Mr Cowen said.

A recorded clip of the RTÉ interview showed the Taoiseach made no direct mention of the IMF while a Department of Finance source also said the Taoiseach made no reference to the IMF in the question and answer session attended by local and Irish members of the media in Tokyo.

Taoiseach Brian Cowen’s response to the question about comments made by Dan Murphy on the IMF

“I think all of us express ourselves in our own way. Dan Murphy is a very experienced trade unionist and one who has been associated with the partnership process since its inception. I think what is simply being articulated on the basis of the briefings which have been provided is that the sharpness of the downturn is such that all of us need to get real about how we can move forward from here together in meeting this challenge. And particularly I think he is referring to the previous experience in the 1980s when the determined, correct and timely action was a means by which our prosperity was regained and sustained for the future.

“I think that it is important that we allow the discussions which have just begun within the social partnership process to be given an opportunity so we can see if we can come forward with a way forward over a credible time scale to bring about the necessary corrections that are needed.

“I think that the comments that he has made are based on the evidence that are provided by Government in our discussions with the trade unions. And the trade union movement, as with other social partners, must be given now the opportunity, and we expect to have to hand imminently, some ideas and responses from them on foot of those briefings.”

TIMELINE:

TOKYO: Taoiseach asked if comments by trade unionist Dan Murphy that the IMF could be called in reflect the reality facing Irish economy. In answering, Brian Cowen does not mention IMF, but says Murphy’s remarks are based on evidence Government gave to social partners.

DUBLIN: RTÉ reports Taoiseach “confirmed” IMF may be called in to sort out Irish economy.

WORLD MARKETS: Euro falls by more than a cent against the dollar as news wires spread RTÉ story.

TOKYO: Taoiseach insists: “I never said that.”

DUBLIN: RTÉ issues correction.