The Tánaiste says she hoped people would be able to speak more freely to the Oireachtas banking inquiry following the publication of the 2010 letter from then ECB president Jean- Claude Trichet to former minister for finance Brian Lenihan.
“I welcome the publication of the Trichet letter,” she said.
Joan Burton said the inquiry was in the process of being established and chairman Ciarán Lynch TD and other committee members were taking it seriously. "The source of what happened in the Trichet letter was the disastrous blanket bank guarantee."
She was replying in the Dáil to Catherine Murphy (Ind), who said that 43 per cent of the banking crisis was shouldered by Ireland and the Government had never asked that the debt be written down. She asked if the Government would ask Europe to write the debt off now, adding that people were being burdened with something not of their making.
Ms Burton said it was regrettable that Independent TDs at the time voted for the “fatal bank guarantee”. The current position was that the country was in recovery, she added.
In the Seanad, Fianna Fáil Senators accused Mr Trichet of bullying Ireland into the bailout. Terry Leyden said that according to the article by Cliff Taylor in The Irish Times, Mr Trichet had stated that "further emergency liquidity . . . would not be provided for the Irish banking system unless Ireland applied for a bailout".
‘Jumped the gun’
The Central Bank governor,
Patrick Honohan
, had, the previous day, “jumped the gun for his own reasons and appeared on Morning Ireland to pressure the Government into accepting Mr Trichet’s diktat”.
Mr Leyden said he was with Mr Lenihan when Prof Honohan rang from Frankfurt demanding that a Cabinet meeting be called.
“Brian Lenihan was making a last-ditch attempt to burn the bondholders, but that was refused by Mr Trichet who had previously indicated that he would give some concession.”
He said the Government was pushed into the bailout. “History will show what really happened. Some 58 members of the Fianna Fáil parliamentary party lost their seats as a result of those events.’’
John Whelan (Lab) interjected: "There were far worse consequences.''
Paschal Mooney (FF) said serious and important questions had been raised about the role of the ECB at a time when the State was facing economic collapse.
“I am sure the public will interpret the letter in such a way as to suggest that Brian Lenihan had little choice but to bow to what I can only describe as the bullying of the president of the ECB,” Mr Mooney added.
