IMF official quiet on calls for Irish debt write-down

The International Monetary Fund has refused to comment on calls for Ireland to be given a debt write-down if any deal is struck with Greece, after the opposition urged action to be taken on the issue.

IMF mission chief to Ireland, Craig Beaumont, declined to be drawn on the issue during a briefing which heard him call for cuts to universal child benefit and restraint in public service pay rise talks later this year.

Speaking on Raidío na Gaeltachta earlier in the day, Fianna Fáil leader Micheál Martin said the fallout from the recent elections in Greece means there is a clear need for a “European debt conference” to discuss a “fundamental change in the European policy on debt”.

He said a “restructuring” of IMF loans would “offer greater relief not just to Greece but this country too” and that it is his view Ireland has “earned” the right to seek the deal.

However, Mr Beaumont appeared to downplay the possibility during a briefing on Ireland’s medium-term financial prospects, saying it would be “very premature” to discuss any move before it is known what will happen to Greece.

The Department of Finance did not respond to questions on whether it supported Mr Martin’s call last night, 24 hours after Finance Minister Michael Noonan said he would be watching what happens in Athens with interest.

Meanwhile, the IMF will again push for universal child benefit to be slashed for wealthier families in a March report as part of ongoing attempts to drive down Ireland’s universal social protection supports.

Mr Beaumont said while the group will endeavour to protect low income households, savings “targeted” at households “who may already be relatively well-off” can still be achieved.

The senior IMF official also said that there is “very limited” scope for “a hike” in public pay in the near future.

He said if Ireland’s growth remains on course, our structural deficit will be 0% by 2018, adding the risk to the recovery from the claimed return to auction politics earlier this month and changes to water charges were internal government issues.