I hope Ireland realises that a lot of help has already been provided
“WE KNOW FROM EXPERIENCE THAT STRUCTURAL REFORMS COMBINED WITH FISCAL ADJUSTMENT, OVER TIME LEADS TO HIGHER GROWTH”
PRECAUTIONARY CREDIT LINE FOR IRELAND
Ireland is entering the final phase of the programme – it had its eleventh troika review last week – and intends to exit its bailout programme and return to private market funding by the end of the year. When asked in an interview on the 22nd July do you think it needs the support of a precautionary credit line?
Klaus Regling of the European Stability Mechanism (ESM) managing director said It’s hard to say. The first thing to say is that Ireland has made very good progress. The objective of every support programme is to return to the market. Ireland has been able to return to the market already, even with a 10 year government bond issue, there was one in March , and there were shorter maturities and all were at reasonable rates. 10 year government bonds for Ireland now have a yield in the secondary market of below four per cent.
That’s a very reasonable rate and in that sense Ireland is already a success story and very close to normal market conditions . I know there is a debate out there about what should happen after the end of this programme, but I cannot add very much to that because we are now in July and the programme ends in December. I am very happy to see the 11th review was concluded successfully like all the reviews before, so let’s see in a few months time where the country stands. Concerning your question on a precautionary credit line I can only say that in principle the instrument is available.
Q: Yes, so what possibilities are there from the ESM’s perspective?
KR: The ESM has a precautionary programme, like the IMF offers such a programme. It has never been used so far at the ESM. It does require a request from the government of the beneficiary country to the group of euro finance ministers, the euro group, which is our board of governors. It would require, in five or six member states, approval by their parliaments.
Q: What kind of conditions would it require?
KR: That is really impossible to say. That would depend very much on the assessment at the time.
Q: As you say the bond yields have come right down below 4 per cent. There’s been a huge drop.
KR: By more than two thirds. Very impressive!
Q: But how important is it – Ireland has a budget coming in October – that Ireland implements this cut of €3.1 billion in terms of it exiting the bailout and keeping those bond-levels down?
KR: I think that is certainly one of the elements markets are looking at. They want to know how the budgetary developments are. Ireland comes from a particularly high fiscal deficit. We know why, it is the result of recapitalising banks. Ireland had in that context the highest deficit of any country in Europe, or maybe the world, so Ireland has made good progress. But it is important tocontinue that. All our member states agreed on the revised stability and growth pact which requires to move first to a deficit below 3 per cent of GDP and then towards a balanced budget. It is important to make progress in that direction. I think that at the end of the 11th review, it was very clear that another €3.1 billion fiscal adjustment as foreseen under current rules and as previously agreed with the authorities is the important next step.
Q: You mentioned there that any decision on a precautionary credit line would need the support of the euro group…
KR: Oh absolutely, there the rules are very clear. We can only engage into a new programme, whether it’s a full scale macroadjustment programme or a precautionary programme, if the euro group takes an unanimous decision.
Q: So do you think that Ireland needs to stick to its target in October in order to get the support of the euro group?
KR: I don’t know what the conditions would be, but if the agreed target were not reached I’m sure that would not be well-received.
RETROSPECTIVE RECAPITALISATION
Q: Ok, to move on, to the direct bank recapitalization instrument. This was a real priority for Ireland in terms of the retroactivity element, and it was seen as a victory for Ireland and Portugal last month when the euro group agreed to look at this on a case by case basis. Irish people have been told, or believe, that this will be open to Ireland. Do you think this is realistic?
KR: Firstly the agreement to create the instrument of direct bank recapitalisation once the ECB plays its role as a single supervisor is a very important step for Ireland, but also for the entire euro area. The reason is that it is one of several elements of the banking union that we are trying to achieve and I think that’s very important for the euro area as a whole, including Ireland. The question of retroactivity is controversial. The euro group agreed to consider it on a case by case basis and to decide on it by mutual consent, that’s what the communiqué said. So it’s impossible for me to judge today under which circumstances it might be approved.
Q: Is it not the case that the whole ambition of direct recap has been scaled back slightly? There’s a belief out there that it might never happen. Now it is dependent on the Bank Recovery and Resolution Directive being passed by the European Parliament. Is direct bank recap ever going to happen?
KR: The euro group, the 17 finance ministers of the euro area, agreed on the main features of the instrument, so here at the ESM we are preparing ourselves to be ready in case a formal decision is taken later to create this new instrument. We received the mandate to prepare ourselves and I assume we would not have been asked to do that unless ministers wanted to use it once the circumstances are in place under which they want to use this instrument.
When you say there is a general feeling it has been scaled back, I don’t know whether you refer to the media, or to analysts. There is a bit of fluctuations in these feelings. Two weeks before the main features of the direct bank recapitalisation instrument were agreed there was a general feeling in many newspapers that it would never happen, that there would be no agreement. But there was agreement. And I think that was positive for the euro area as a whole.
Of course one has to look at the overall context. The ESM has an overall lending capacity of €500 billion. We have many instruments available. We know that direct bank recapitalisation takes a lot of our capital, up to three times more than for a normal macro-economic adjustment programme. That’s why the overall amount that is potentially available for direct bank recap was capped at €60 billion. The reason for this cap is that everyone agrees that enough money should be left for the other instruments that the ESM has at its disposal, in particular the macroeconomic adjustment lending . That will remain the main focus of the ESM. But direct bank recap very likely will become a new instrument, an additional instrument, and again we are preparing ourselves.
Q Do you have any views on its suitability for a country like Ireland. Politically a lot of store is put on something like this . A lot of ordinary tax payers feel that while the changes in banking union shifts away the burden from the tax payer and onto private creditors, that’s too late for Ireland, that wasn’t available for Ireland, so Irish people feel they are entitled to get some of the money they put into the banks. Do you agree with that? Or do you think that Ireland doesn’t necessarily need this to regain private market funding? How important do you think it is?
KR: It is easy to say it would help, but the eurogroup communiqué said that the decision to use the direct bank recapitalization instrument retroactively would be taken on a case by case basis and by mutual agreement. It will be up to the political level in the euro area to decide how that is interpreted. At the same time I hope Ireland realises that a lot of help has been provided, because the financing we provided, that the IMF has been providing, and also third countries have provided over the last two and a half years comes at very low interest rates, so Ireland benefits from this low interest rate.
Our own lending is provided at less than one and a half per cent for instance so that’s a big benefit for Ireland as it is for other countries that borrow from the EFSF. There are also special arrangements with the ECB that have been found, where the Irish banking sector benefits greatly. We know that the crisis has put a huge burden on the Irish taxpayer, the Irish population, but there has also been a lot of solidarity from Europe and the international partners.
Health Minister James Reilly sets a target of just 5% still smoking by year 2025
THE HEALTH DR. JAMES REILLY AIMS TO REDUCE THE NUMBER OF SMOKERS TO FEWER THAN ONE IN 20 I.E. 5% PEOPLE BY 2025.
That would mean slashing current statistics which show almost one in three smokes.
Dr Reilly said he wants a tobacco-free Ireland in the next 12 years, and his plan has been approved by the Cabinet as the centrepiece of a new Government strategy to tackle tobacco use. It is due to be launched in September.
Dr Reilly, right, yesterday told the Oireachtas Health Committee that the tobacco industry is “gearing up big time” for what he described as a “battle”.
And he vowed never to meet tobacco lobbyists, saying he has “strong professional and personalfeelings about this particular industry”.
Dr Reilly’s father and brother, who were also doctors, died from smoking-related illnesses, and the Dublin North TD said the fight against tobacco companies is one the Government must not lose.
“It’s the only product I know that is legally freely available that will kill you if you use it,” Dr Reilly said. “It’s a fight that we cannot turn away from and that we can’t afford to lose. It’s a battle that will continue until it’s won – and it will be won.”
The strategy document is called “Tobacco-Free Ireland”, and aims to bring the proportion of the population who smoke down to 5pc from its current level of 29pc. The OECD average is 21pc.
Dr Reilly also met a number of campaign groups including the Irish Heart Foundation, the Irish Cancer Society, Barnardos and Cystic Fibrosis Ireland yesterday to discuss “the dreadful damage” of smoking.
He was also asked by Senator John Crown about progress on legislation to ban smoking in cars where children are passengers, a proposal Prof Crown introduced and the Government supported.
Dr Reilly said the proposal is one of his priorities, but added that the Government had many pieces of legislation to deal with.
TAXATION: He also said the country has officially begun the process of introducing plain cigarette packaging.
An extension of the smoking ban from the workplace to public areas such as parks and beaches is on the cards, but will be introduced only after the car ban is in place.
However, smokers’ group Forest Eireann said: “It is totally unrealistic to think that Ireland will be tobacco-free in 12 years.
“Recent anti-tobacco measures such as the smoking ban, increased taxation and the display ban have done nothing to reduce smoking rates in Ireland.”
Research confirms family link to 13 different cancers
Study of 23,000 people finds that for all 13 cancers, close relatives had an increased risk of same disease
The results of research confirmed known associations such as the increased risk of developing the same cancer as a first-degree relative
A family history of a particular cancer increases the risk of other members of the family developing not only the same cancer but also of getting cancers at different sites in the body, research published this morning suggests.
Researchers from Italy, Switzerland and France looked at some 12,000 cases of cancer occurring in 13 different body sites and then matched these with a control group of 11,000 people without cancer. The results confirmed known associations such as the increased risk of developing the same cancer as a first-degree relative.
But the study also found a 3.3 – fold increased risk of developing oral cancer for someone with a close relative who had been diagnosed with cancer of the larynx (voice-box) and a four-fold increased risk of cancer of the oesophagus (gullet) in a person with a first-degree relative who had oral cancer. And family members had 3.4 times the risk of developing prostate cancer if a first – degree relative had bladder cancer.
The research, published in the European cancer journal Annals of Oncology provides a comprehensive picture of the risk of developing various different types of cancer in families where there is a history of the disease; it also takes into account other factors, such as individual characteristics and lifestyles, that could affect the degree of risk as well.
Dr Eva Negri of the Mario Negri Institute for Pharmacological Research, Milan, Italy, said: “We have also found that if a patient was diagnosed with certain cancers when they were younger than 60, the risks of a discordant (different) cancer developing in family members were greater. ”
She added that some of the associations between cancers at different sites were probably due to shared environmental factors such as family habits of smoking and drinking but that the possibility of a genetic link would also need to be explored in future research.
15% of HSE junior doctors are agency staff
The HSE has spent €8.6 million so far this year on employing agency medical staff to fill vacant hospital junior doctor posts.
The total paid out last year on agency hospital doctors was €18.4 million, according to figures provided by the HSE to Senator Colm Burke of Fine Gael at the Oireachtas Health Committee this week.
A report on junior doctor posts to the Committee said there were 31 doctor vacancies in hospitals at present, following the normal July doctor changeover. The HSE said this summer, all hospitals have been able to secure sufficient numbers of doctors to resolve recruitment issues and maintain existing services.
At present, around 15% of junior doctor posts are made up of agency staff.
According to the HSE report, some hospitals have been employing doctors at consultant level to ensure a greater level of senior clinical decision making, in the face of junior doctor recruitment difficulties.
There are currently nearly 5,000 junior doctor posts in Irish hospitals, according to the HSE.
Health Minister James Reilly yesterday said the current system under which junior work was ‘perverse’.
He said it was unacceptable to ask juniors to make life and death decisions after working long hours.
The Minister said it was also wrong that our system educated the brightest and best doctors yet forced them abroad and then had to recruit doctors from developing counries to work here.
Dr Reilly has established a working group to look at alternative career and working systrems that could be put in place for junior medics.
Meanwhile, the HSE also told the Oireachtas Committee that only 60 put of 117 hosital consultant posts advertised since June of last year have to been filled.
A Full Moon can disturb a good night’s sleep researchers say
The disturbance in sleep patterns is not connected to the extra light of a full Moon
Researchers found evidence of a “lunar influence” in a study of 33 volunteers sleeping in tightly controlled laboratory conditions.
When the Moon was round, the volunteers took longer to nod off and had poorer quality sleep, despite being shut in a darkened room, Current Biology reports.
They also had a dip in levels of a hormone called melatonin that is linked to natural-body clock cycles.
When it is dark, the body makes more melatonin. And it produces less when it is light.
Being exposed to bright lights in the evening or too little light during the day can disrupt the body’s normal melatonin cycles.
But the work in Current Biology, by Prof Christian Cajochen and colleagues from Basel University in Switzerland, suggests the Moon’s effects may be unrelated to its brightness.
Lunar rhythms: The volunteers were unaware of the purpose of the study and could not see the Moon from their beds in the researchers’ sleep lab.
They each spent two separate nights at the lab under close observation.
Findings revealed that around the full Moon, brain activity related to deep sleep dropped by nearly a third. Melatonin levels also dipped.
The volunteers also took five minutes longer to fall asleep and slept for 20 minutes less when there was a full Moon.
Prof Cajochen said: “The lunar cycle seems to influence human sleep, even when one does not ‘see’ the Moon and is not aware of the actual moon phase.”
Some people may be exquisitely sensitive to the Moon, say the researchers.
Their study did not originally set out to investigate a lunar effect. The researchers had the idea of doing the lunar analysis years later, while chatting over a few drinks.
They went back to their old data and factored in whether or not there had been a full Moon on the nights the volunteers had slept in their lab.
UK sleep expert Dr Neil Stanley said, nonetheless, the small study appeared to have significant findings.
“There is a such a strong cultural story around the full Moon that it would not be surprising if it has an effect.
“It’s one of these folk things that you would suspect has a germ of truth.
“It’s up to science now to find out what’s the cause of why we might sleep differently when there’s a full Moon.”
UCD volunteers build Stone Age Mesolithic dwelling
The structure is six metres in diameter and seven metres tallThe UCD group plans to carry out further experiments by building a number of other structures on the same site
A team of volunteers from the School of Archaeology at UCD have built a Mesolithic dwelling, largely using Stone Age technologies and materials.
The project – based closely on archaeological data from Mount Sandel in Co Derry – aims to cast new light on how such structures were built in the centuries following 8000 BC.
The UCD structure is six metres in diameter and seven metres tall.
It has been built from a number of birch posts, which go up to form an apex, with willow sticks weaved between them.
Turf has been laid across the roof.
The team believe structures like this, which can be found across Europe, raise many important questions about the nature of Mesolithic life.
“For example – structures like this are generally interpreted as houses, and they are often reconstructed repeatedly on the same location over the span of 100-150 years” explains Dr Graeme Warren of UCD’s school of archaeology.
“The large size and clear permanence of these buildings is a challenge to many of our ideas of Mesolithic settlement which have tended to stress that people were highly mobile and characterised by little in the way of permanent architecture.”
“Such questions can be approached through the techniques of experimental archaeology, which involves the creation of objects, buildings, activities and contexts, through which ideas about people’s lives in the past can be thought about in practical terms.”
The structure, in a corner of the UCD campus, will be left to decay to allow researchers to estimate how long such buildings lasted before the early settlers decided to rebuild or move on.
The UCD group plans to carry out further experiments by building a number of other structures on the same site.
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