Privatisation pot must be preserved for the national pension fund

Intrinsic share values of state companies have been systematically pillaged by management and employees.

THE Cabinet is to sign off shortly on proposals for privatisation of commercial state companies. They are obliged to present to the troika next month plans to sell-off state assets. The bailout boys are set to play hardball. Greece and Portugal were obliged to multiply original targets of sales receipts. The IMF suggested last week that Ireland should raise €5bn instead of €2bn, as set out in the Programme for Government. Politics, pragmatism, ideology and street smart commercial competence combine to set the agenda for coming decades for essential sectors of the economy.

The first row relates to the proceeds of privatisation. Our creditors, like any loan shark or moneylender, demand that we offset all cash received against the €67bn of the bailout or repay sovereign debt. This makes no sense. €3.8bn of unguaranteed senior bonds may still be redeemed for Anglo Irish and Nationwide. It is incredible that we would sell vital productive assets simply to pay off bondholders who bet on these institutions that will never function — let alone lend again. This is the definition of “putting good money after bad”.