Gilmore tells ECB representative to mind his own business

GERMANY’S representative at the European Central Bank was told to mind his own business by Tánaiste Eamon Gilmore, who reaffirmed the Government’s commitment to the Croke Park agreement.

Jurgen Stark said that Ireland should cut public servants’ pay in the December budget as part of austerity measures to resolve the debt crisis.

However, Mr Gilmore said the Government was committed to the Croke Park agreement that gives pay certainty to the public service for reforms, and accused Mr Stark of “inventing new agendas”.

He said the Government had not been asked by the troika — the ECB, EU and IMF — to accelerate the austerity programme and, in fact, had said that the country is complying with the conditions.

“This is in marked contrast to other countries,” he said. “Those statements by Mr Stark did not help our cause. We have a difficult job to do. We will do it. It’s working. We are confident it is going to succeed and that kind of encouragement from the sidelines we do not need.”

He said it was not helpful to have an individual officer with one of the three institutions of the troika to come out and make comments not in line with the agreement with these institutions.

“People need to know where they stand and, by the same token, agreement with trade union representatives and workers in the public service is achieving significant reforms and very significant reductions in pay and conditions,” he said.

Within hours of making the statement the 63-year-old economist had resigned his seat on the ECB where he was considered to be the second most important person after ECB president Jean Claude Trichet. It is understood his resignation was because he disagreed with the bank’s decision to once again buy bonds of crisis-hit eurozone countries.

The Tánaiste described as very worrying the effect on markets that fears over Greece defaulting were having. The Government was keeping a watch on it but he believed that, while it would not affect Ireland directly, it could indirectly through its impact on the euro and the eurozone.

However, he said it was time to move the debate on from just austerity to the critical area of growth and jobs. He had received considerable support for this from fellow ministers at the foreign affairs meeting in Brussels yesterday.

He said that despite a push by the IMF for the Government to sell off virtually all state-owned assets valued at €5bn, the Government was only interested in getting rid of a certain number with a value of about €2bn.