Labour will ‘not be bound’ by agreement

LABOUR leader Eamon Gilmore has insisted his party will “not be bound” by the strict terms and conditions attached to the EU/IMF bailout.

He told the Dáil that the deal was a “sell-out” of Ireland and its right to determine its own future.

The memo of understanding between the Government, EU and IMF obliges Ireland to make €6bn of spending cuts and tax hikes in next week’s budget followed by another €3.6bn in next year’s budget and €3.1bn in 2012.

The memo also lays out where the EU and IMF expect the Government to produce the savings.

Quarterly reviews will be carried out to ensure the Government is meeting its obligations, and money won’t be released unless the EU and IMF are satisfied this is the case.

The terms of the agreement appear to curtail any room for manoeuvre the next government, expected to be a Fine Gael-Labour coalition, will have.

The EU and IMF have indicated that, while a new government could remove certain cuts from the deal, it would have to produce substitute savings. And any proposed changes by a new government would first have to be cleared with the two organisations.

Mr Gilmore said it was wrong for the Government to agree to a deal with international organisations that effectively spelled out the next three budgets without recourse to the Dáil.

“It is a surrender by the Government of this country’s sovereignty, of its right to make its own decisions, determine its own budgets, and the Labour Party... will not be bound by this document,” he said.

Tánaiste Mary Coughlan challenged Mr Gilmore to say where he would get the money to keep Ireland afloat if he rejected the deal.

Any government that rejected the deal would have to immediately slash public spending by €19bn — the difference between the state’s income and expenditure — as Ireland could not afford to borrow the money on the market, she said.

Sinn Féin Dáil leader Caoimhghín Ó Caoláin echoed Mr Gilmore’s comments, saying no party should feel bound “by any deal struck by this Government, which has no mandate or political authority”.

Fine Gael leader Enda Kenny poked fun at Green leader John Gormley, who earlier this week likened being in Government during the current crisis to being in an “asylum”.

“If it gets too hot, some people should leave the kitchen,” Mr Kenny said.

He called on the Tánaiste to spell out when the Dáil would return in January. Ms Coughlan replied: “No decision has been made on when the House will resume after Christmas; all I can say is that it will resume after Christmas.”