Nama essential in tackling banking crisis, says EU commissioner

The controversial Nama proposal is essential in tackling Ireland’s banking crisis, the EU’s economic commissioner said today.

Joaquin Almunia, economic and monetary affairs representative, called for the Dáil to sign-off on the toxic assets agency as soon as possible.

After talks with Finance Minister Brian Lenihan the senior European figure also claimed everybody but the poorest in society must shoulder the burden of tackling the crisis.

“My wishes for the next couple of months here is first that the Nama will be adopted by the parliament as soon as possible,” Mr Almunia said.

“It is one very important issue.”

Last month Mr Lenihan told the Dáil Nama would pay out €54bn to wipe toxic assets and loans from the banks balance sheets – €7bn over the odds.

Later, the European Commission insisted Mr Almunia had not endorsed Nama but the idea of a bad-bank rescue plan.

A spokesman for the Commission said Nama could only be fully endorsed when the final details had been passed by the Dáil and accepted by Competition Commissioner Neelie Kroes.

Mr Almunia said that with the exception of the least well off, everybody needed to play a role in tackling the recession.

“It is true that the workers didn’t create this crisis. The origin of this crisis is well known, it was financial.

“But now we have no other alternative than to face the situation as it is... everybody should contribute.”

Mr Lenihan stressed the need for cuts to public-sector pay and welfare payments in the upcoming budget to off-set the level of Government borrowing.

Mr Almunia and Mr Lenihan discussed Ireland’s banking crisis, competitiveness and state of the public finances.

The Commissioner said he believed the country’s economy would bounce back, but measures needed to be taken.

“I really wish that in December the Irish Government and the Irish parliament will discuss and adopt the budget that is needed,” he said.

Meanwhile the EU commissioner described the Lisbon Treaty result as fantastic.