The public finances of the 26-County state will, for the next three years at least, be subject to “regular reviews” by external monitors working on behalf of the International Monetary Fund, the European Union, and the British and Swedish governments.
Last night [Sunday], the Taoiseach Brian Cowen and Minister for Finance Brian Lenihan, after a week of shocking lies and deceit, said they were accepting the IMF/EU bailout. It later emerged that the G7, comprising the seven most powerful countries in the world, had met to give its approval to the deal.
The total of the IMF and EU funds, as well as aid from the British exchequer and elsewhere, is expected to reach about a hundred billion euro. Most of the money is destined to disappear into the Irish banks, which are coping with unknown losses and whose potential collapse is said to be threatening the European and even the global economy.
The programme, as agreed with the international bodies, will last three years. However, the exact amount of the financial aid and the conditions to be applied to all of the funds still remain unknown.
It was also disclosed that, separately, Britain and Sweden are both to extend multi-billion-euro loans to Ireland, also with undisclosed conditions.
Cowen said the package would have two elements. The first would be a deep restructuring of the Irish banks. “Irish banks will become significantly smaller than they were in the past,” he said.
The second part of the “strong policy programme” would be increased taxes and reduced spending in order to reduce government borrowing by 15 billion euro over the next four years.
On the question of relinquishing sovereignty, Cowen claimed the Budget and four-year plan would not be changed by the external bodies but said “a small, open economy like Ireland did not have the luxury of taking decisions without reference to the wider world”.
Lenihan said the State’s options had narrowed considerably since the banking and construction collapses in 2008.
“It is essential that we maintain economic continuity, that everyone understands that ATM machines function, that salaries are paid, that the big workforce that has built up here continues to be employed, that a large number of overseas investors continue to invest in enterprise,” he said.
Reacting to the announcement on Sunday night, Sinn Fein President Gerry Adams said the government has no mandate to do what it is doing.
“It has handed over authority for the state to outsiders in order to get a digout for the banks, which the Irish people will have to pay for. The Government should resign so that citizens can have their say in a General Election.”
Sinn Fein TD Aengus O Snodaigh said the government should throw the IMF out of the country.
Deputy O Snodaigh said Irish Sovereignty was not something that Fianna Fail and the Green Party could “sell off to the highest bidder”.
“This government has brought the country to the brink of economic collapse and now they want to sell of our hard won sovereignty to the IMF.
“The history of the IMF in other countries is one of privatisation of vital public services and mass unemployment.
“But there is another way. It’s time to burn the bondholders and nationalise Bank of Ireland and Allied Irish Bank.
“The Government should throw the IMF out of the country before resigning and calling a general election.
“Irish sovereignty is not something that Fianna Fail and the Green Party can sell off to the highest bidder.
“They have absolutely no mandate for any of what they are doing and they are acting against the wishes of the people.”