Donie's news Ireland BLOG

Enda Kenny says ECB deal could cut borrowing by as much as €20 billion

  

In the Dail today Taoiseach Enda Kenny above announces a deal has been agreed with the European Central Bank on the Anglo promissory notes. Mario Dragi right picture.

A debt deal to cut the cost of Ireland’s toxic bank rescue could slash €1 billion from tax hikes and spending cuts in upcoming budgets, the Government has claimed.

Taoiseach Enda Kenny said the agreement was not a silver bullet but declared that it would reduce state borrowing by €20 billion over the next decade.

“Step-by-step, this Government is undoing the disastrous banking policies that brought this state to the brink of national bankruptcy,” the Taoiseach said.

“The agreement has reduced Ireland’s vulnerability from the huge debts taken on by Irish taxpayers as a result of the cost of rescuing failed private banks.”

The Government did not ask for a write-down on the Anglo debt during negotiations with the European Central Bank (ECB).

“We always said that we were not looking for any write downs. Anybody who knows the European situation knows that the ECB does not do write downs,” Minister for Finance Michael Noonan said.

Mr Kenny said the liquidation of the IBRC had caused the Central Bank to assume full ownership of the €25 billion in promissory notes and other collateral held as security for the funds provided by the Central Bank to the IBRC.

Arriving in Brussels this evening for a meeting of EU leaders, the Taoiseach said it was a “good day for Ireland.”

Mr Kenny said he planned to “explain to leaders when it is appropriate” the nature of the agreement and the arrangement arrived at for Ireland, which was “very much in the Irish people’s interests”.

He said the promissory note deal was “recognition of where there clearly is evidence of a government and a people working together in taking on challenging positions, that that challenge can be rewarded by co-operation and assistance from our European partners.”

He said that other restructuring regarding legacy bank debt was “a different argument for a different day.” .

ECB deal

Under the agreement reached today with the ECB, the promissory notes are being exchanged for long-term Irish Government bonds with maturities of up to 40 years. The first principal payment will not now be made until 2038 and the last payment will be made in 2053.

Mr Kenny said earlier the average maturity of the Government bonds would be over 34 years, as opposed to the seven to eight-year average maturity on the promissory notes.

In effect, they have replaced a short-term, high-interest rate overdraft that had to be paid down quickly through more expensive borrowings with long-term and cheap interest-only loans, he added.

He said the Central Bank would take ownership of the €3.4 billion bond used to settle to the promissory note last March. As a result, there would be a €20 billion reduction in the NTMA’s market borrowing requirements in the next decade. The average interest rate on the new bonds would begin at just over 3 per cent compared with an interest rate of well over 8 per cent on the promissory notes.

This, he added, would result in a reduction in the States general Government deficit of approximately €1 billion per annum over the coming years.

“Today’s outcome is an historic step on the road to economic recovery,” said Mr Kenny. “Step-by-step, this Government is undoing the disastrous banking policies that brought this State to the brink of national bankruptcy.”

However, he warned the deal was not a “silver bullet” for Ireland. “We still have along way to travel back to prosperity, the damage done by financial institutions will take many years to rectify,” Mr Kenny said.

The deal “removes a considerable burden from the shoulders of our people”, Tánaiste Eamon Gilmore told TDs.

“This package of measures will make a marked difference to Ireland’s debt sustainability,” he said.

Last night, the Government introduced emergency legislation to allow for the liquidation of Irish Bank Resolution Corporation, the former Anglo.

Minister of State at the Department of Finance Brian Hayes said this morning the Government was very confident about the constitutionality and “legal robustness” of the legislation. He said any action by the bank in relation to the Quinn family would continue and the Government would do everything it could to recover assets that belonged to the Irish people.

Mr Noonan also disclosed in the Seanad that the legislation had been prepared some months ago and that KPMG had been on standby for months to step in at short notice in the event of a leak such as the one that happened yesterday. He said there had been several “scares” in recent months with concerns about “substantial leaks” that might have had an adverse impact on the assets of IBRC.

A senior source confirmed that a draft of the legislation had been prepared last autumn when a similar leak of sensitive information seemed possible.

In his Dáil speech, Mr Noonan said it was not possible to have a long drawn out debate where assets of the IBRC were deteriorating.

Opposition speakers were critical of the manner in which the former bank’s 850 employees had discovered that their jobs were being terminated through the media. They contended that there was a lack of detail and clarification from the Minister about what will happen to employees. Mr Noonan said that all employee contracts would be terminated but the majority would be rehired during the winding down process. The loss of jobs and the insensitive nature that the workers were treated were referred to frequently by opposition TDs and Senators during the course of the debate.

The 56-page Bill was published following a hastily-arranged Cabinet meeting at 9pm, and after a series of procedural adjournments, the Dail began debating the legislation just after midnight.

Mr Noonan said because information relating to the proposal to liquidate IBRC was leaked by “international agencies” there was an immediate risk to the bank and he had to take immediate action to secure the stability of the bank and the value of its assets, valued at €12 billion, on behalf of the State.

The Minister said it was “unheard of for a liquidation to be announced only for it not to be implement immediately”.

To do so would allow creditors strip the company of its assets, and debtors to refuse to pay. He said the Government was in a position where it could not deny the details of its plan. “To this end, I vested the powers of the board temporarily in an employee of KPMG and a KPMG team is now in control of the Bank on my behalf.”

Mr Noonan said once the legislation was passed joint special liquidators will be appointed to IBRC with immediate effect to wind up its business and operations.

After a debate of just under three hours, the Bill was passed by 113 votes to 35 and referred to the Seanad.

The debate in the Seanad commenced at about 3am and was completed a little after 5.40am when the upper house approved the legislation by 37 votes to six. Along with three Sinn Féin senators, independent senators John Crown and Sean Barrett voted against, as did the Labour senator James Heffernan, who had already relinquished the party whip.

Galway companies encouraged to apply to €500,000 training fund

  

Private sector companies in Galway are being encouraged to apply to a new training fund, announced this week by Skillnets, the national training and up-skilling body. The €500,000 fund is open for applications until April 30 2013.

Groups of companies must join together to form a network to apply for funding. Groups can be formed on a geographical or sectoral basis, once member companies have identified common training needs amongst their employees.

Networks hoping to receive funding under the new round must complete an online registration form by 31st March before then submitting a complete application by April 30 deadline.

Skillnets currently funds and facilitates training through 55 networks of companies in a range of sectors and regions. Each network delivers training relevant to the needs of specific industries and member companies. Networks already active in Galway City and County include: Information Technology Association of Galway (ITAG) Skillnet, Gréasán na Meán Skillnet, Galway Executive Skillnet, and High Potential Start-Up (HPSU) Skillnet

To date, Skillnets has facilitated over 60,000 Irish enterprises to upskill over 275,000 employees. In addition, the organisation has trained over 9,000 job-seekers since 2010.

Under the fund announced this week, Skillnets will make grants available to new training networks to pilot the delivery of training. Successful applicants will be required to provide matched funding of at least 50 per cent of all costs associated with training delivery.

Alan Nuzum, CEO of Skillnets, said the organisation was focusing on the need to preserve jobs and create new jobs through industry-led training interventions.

“As part of our strategy to respond to changing labour market needs, we are supporting companies to deliver training that enables growth and expansion into other markets, and helps to cross-skill and upskill employees and job-seekers,” he said.

“With this new funding round, we are placing a particular emphasis on training for industries not fully serviced by the training networks already in operation. We have identified a number of industries that are key to Ireland’s future economic growth, and we will be particularly welcoming of applications from training networks within those industries. These include: agri-food production; ICT; life sciences; manufacturing, electronics and engineering; internationally-traded services; and the green economy.”

Under this round, funding will be provided for training activities from June 1 to December 31 2013. During that period, supports will also be provided for training networks to ensure they can avail of additional funding streams in future years to secure their sustainability.

“The training and upskilling opportunities provided through Skillnets have the potential to enhance whole sectors of the economy, and we are looking forward to expanding the reach of Skillnets with this new call,” said Alan Nuzum. “We consistently achieve positive feedback from companies already involved in our networks, who tell us how the training programmes they have developed have led to enhanced growth and employment. We are looking forward to similarly positive results with the new networks that will be funded under this round.”

Founder of CARA Risk Management Solutions and spokesperson for Galway Executive Skillnet, Liam Higgins, said he would encourage all businesses in the region to explore the opportunities presented by becoming involved in Skillnets training networks.

“The funding available is crucial in enabling many companies to upskill their workforce in the face of strong international competition for projects that require high-level skills,” said Mr Higgins.

“The training programmes developed are fully industry-led, and this is one of the keys to their success: the Skillnets model allows for the creation and development of training programmes that may not have existed before and that are completely relevant to current industry needs.”

‘Vegetarians are healthier’ I don’t care so just pass me a burger

   

A new report says Vegetarians are a third less likely to develop heart disease than meat-eaters.

After the horse meat revelations this report, by Oxford University, only gives further ammo to the veggie mafia. I’ve had enough of the Anti-Meat Brigade at this stage. I’m coming out of the freezer and declaring that I love eating meat.

Don’t get me wrong. I don’t hate the cabbage chewers – some of my best friends are vegetarians. I’ve even had them over to (green) tea once. But enough is enough.

Manhood: I’ve taken the deprivation of a Troika bailout and even got the gang in the house to practice the German National Anthem. Worse still for my manhood, I watched as male friends took to wearing man bags, mankinis and onesies last Christmas.

What’s to be left of an Irishman’s masculinity if you take away his meat?

Meat is at the heart of all things in this country. When we were kids it was a unit of currency. I remember as a child the occasions when returning relatives from the USA would take us out for a meal. ‘Did they stand you a steak?’ was the question the grandparents always asked us afterwards. If they had bought you a fillet then those US relations were considered to have ‘made it.’

In the old days of bribery the brown paper bag wasn’t the only route to a county councillor’s heart. One builder told me recently that ‘a few pints and a good steak could swing any man.’ As the Euro totters, perhaps meat can once again be a valuable unit of currency.

There are other factors as to why meat is essential to us. Freud pointed out most of our passions are formed in early childhood. Certainly the sight of a large side of bacon with more hairs than a werewolf landing on the kitchen table one night in my childhood had an impact on me.

I remember us children sitting gobsmacked wondering if the pig was still alive. I watched awestruck as my father stabbed a large knife into the heart of the beast. It didn’t move.

We swallowed it hairs and all as we moved proudly through this rite of passage.

Let me confess that I have tried vegetarianism. There was this girl I really liked. She told me she was a veggie and like any good Irish male I assured her I was too. To prove it, I swallowed veggie concoctions with tears running down my eyes. I even ate veggie burgers.

The Tanaiste to get Taoiseach Enda Kenny to give an apology to MAGDALENE SURVIVORS

   

TANAISTE TO ENGAGE TAOISEACH ON APOLOGY FOR MAGDALENE SURVIVORS

A Labour TD says the Tánaiste will engage with the Taoiseach on his party’s views over the issuing of an apology to the Magdalene survivors.

The Sisters of Mercy ran the Magdalene laundry at Forster street in the city until it closed in 1984.

Yesterday, Labour TDs and Senators said the treatment inflicted on the women was a historical wrong that had to be put right.

The statement followed a meeting which heard widespread criticism of the Government’s handling of the issue.

Labour TD for Louth and Meath East Ged Nash, says he understands the Tánaiste believes a full apology is necessary, but it is the Taoiseach’s place to make one on behalf of the State.

 New Evidence of:

Asteroid impact that killed the Dinosaurs

 

The idea that a cosmic impact ended the age of dinosaurs in what is now Mexico now has fresh new support, researchers say.

The most recent and most familiar mass extinction is the one that finished the reign of the dinosaurs — the end-Cretaceous or Cretaceous-Tertiary extinction event, often known as K-T. The only survivors among the dinosaurs are the birds.

Currently, the main suspect behind this catastrophe is a cosmic impact from an asteroid or comet, an idea first proposed by physicist Luis Alvarez and his son geologist Walter Alvarez. Scientists later found that signs of this collision seemed evident near the town of Chicxulub (CHEEK-sheh-loob) in Mexico in the form of a gargantuan crater more than 110 miles (180 kilometers) wide.

The explosion, likely caused by an object about 6 miles (10 km) across, would have released as much energy as 100 trillion tons of TNT, more than a billion times more than the atom bombs that destroyed Hiroshima and Nagasaki.

However, further work suggested the Chicxulub impact occurred either 300,000 years before or 180,000 years after the end-Cretaceous mass extinction. As such, researchers have explored other possibilities, including other impact sites, such as the controversial Shiva crater in India, or even massive volcanic eruptions, such as those creating the Deccan Flats in India.

Timing of an impact: New findings using high-precision radiometric dating analysis of debris kicked up by the impact now suggest the K-T event and the Chicxulub collision happened no more than 33,000 years apart. In radiometric dating, scientists estimate the ages of samples based on the relative proportions of specific radioactive materials within them. [Wipe Out: History's Most Mysterious Mass Extinctions]

“We’ve shown the impact and the mass extinction coincided as much as one can possibly demonstrate with existing dating techniques,” researcher Paul Renne, a geochronologist and director of the Berkeley Geochronology Center in California,

“It’s gratifying to see these results, for those of us who’ve been arguing a long time that there was an impact at the time of this mass extinction,” geologist Walter Alvarez at the University of California at Berkeley, who did not participate in this study, told LiveScience. “This research is just a tour de force, a demonstration of really skillful geochronology to resolve time that well.”

The fact the impact and mass extinction may have been virtually simultaneous in time supports the idea that the cosmic impact dealt the age of dinosaurs its deathblow.

“The impact was clearly the final straw that pushed Earth past the tipping point,” Renne said. “We have shown that these events are synchronous to within a gnat’s eyebrow, and therefore, the impact clearly played a major role in extinctions, but it probably wasn’t just the impact.”

The new extinction date is precise to within 11,000 years.

“When I got started in the field, the error bars on these events were plus or minus a million years,” added paleontologist William Clemens at the University of California at Berkeley, who did not participate in this research. “It’s an exciting time right now, a lot of which we can attribute to the work that Paul and his colleagues are doing in refining the precision of the time scale with which we work.”

Final blow: Although the cosmic impact and mass extinction coincided in time, Renne cautioned this does not mean the impact was the only cause of the die-offs. For instance, dramatic climate swings in the preceding million years, including long cold snaps in the general hothouse environment of the Cretaceous, probably brought many creatures to the brink of extinction. The volcanic eruptions behind the Deccan Traps might be one cause of these climate variations.

“These precursory phenomena made the global ecosystem much more sensitive to even relatively small triggers, so that what otherwise might have been a fairly minor effect shifted the ecosystem into a new state,” Renne said.

The cosmic impact then proved the deathblow.

“What we really need to do is to understand better what was going on before the impact — what was the level of ecological stress that existed that allowed the impact to be the straw that broke the camel’s back?” Renne said. “We also need better dates for the massive volcanism at the Deccan Flats to better understand when it first started and how fast it occurred.