Future generations ‘saddled with debt’

The Government has been accused of saddling future generations with billions of euro of debt.

Questions were asked as to why the Government had not sought a writedown of the remaining €28bn in Anglo promissory notes owed in the deal agreed with the ECB.

Pressure was also piled on ministers to use the €1bn in savings expected from the deal to create jobs and reward the more vulnerable hit by budget cuts.

Sinn Féin’s Pearse Doherty told the Dáil: “This week my youngest son began to crawl... yet when he will be 40 years of age the State will still be paying back the toxic debts of Anglo Irish Bank.

“What about those children who had no hand, act or part to play and who did not benefit from the boom? Does the Taoiseach consider it is fair for them to be lumped with this burden?”

Sinn Féin claimed last night that taxpayers would also be landed with billions of euro extra in interest payments for the bond deal. Mr Doherty claimed that another €34bn would mount up in interest payments, which could hit €1bn a year.

However, Department of Finance sources played down this claim, arguing that much of the interest payments would be returned through the Central Bank back to the exchequer.

Fianna Fáil gave a cautious welcome to the deal. Party leader Michael Martin said the announcement would facilitate Ireland’s ability to exit the bailout programme and should reduce the need for budget corrections by around €1bn.

The Government def-ended claims that it failed to get any writedown of the Anglo debt by saying no other European country had ever succeeded in getting any such agreement with the ECB, including Greece, for its sovereign debt.

However, he said arrangements were being put in place for new banking rules in the next five years whereby debt would be shared across member states.

“That is not happening to Ireland and that is a big disappointment in respect of this deal,” he said.