Coalition denies chance missed to get debt deal

The Government has denied claims it had squandered its own mandate for change by missing an opportunity to secure a significant debt reduction deal for Ireland.

Coalition denies chance missed to get debt deal

Ashoka Mody, former IMF chief of mission to Ireland, insisted the Coalition should have got a “superior deal” after winning the last election.

He said the parties were elected on a mandate similar to the Greek government — but they had missed a chance to strike a debt deal with international lenders.

“Ireland had its opportunity,” said Mr Mody. “When this new government came in, it came in on a mandate very similar to the current Greek government; it came in on a promise to do some of the similar things.”

Mr Mody said Ireland had accepted the premise that Berlin and Brussels determined economic policy in every country.

Asked whether Ireland had missed an opportunity to strike a deal with the troika lenders, the ex-mission chief said the Government “absolutely” had.

“It was on that premise that it won the election and what the deal at that time could have been, I don’t know, but it should certainly have been a superior deal,” he told Newstalk. “That deal would have required a clear premise on some amount of debt restructuring, a slower pace of fiscal austerity. That’s exactly what the Greek government is asking today.”

In a clear reference to Ireland’s €64bn in bank debt, Mr Mody said it was an “odious” debt.

However, in Brussels, Finance Minister Michael Noonan said the Princeton University professor did nothing for Ireland while here.

“It’s in line with a series of statements Mr Ashko Modi has made about Ireland in recent times, but when he was there and he was in a position to do something, he didn’t do much for us, and his advice now that he is no long in a position to influence, I would take very lightly, he said.

Health Minister Leo Varadkar said Ireland’s strategy was different to Greece’s. “The money that this Government put into banks, we put into live banks. That is all recoverable,” said Mr Varadkar.

“We’ve already recovered all of the money we’ve put into Bank of Ireland and we anticipate being able to recover all of the money we’ve put into AIB as well.”

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