Minister for Foreign Affairs Eamon Gilmore defended the Government's attitude to the crisis in Cyprus.

"It is not true that we did not support Cyprus in its hour of need. Ireland expressed its solidarity with Cyprus with regard to what was happening there."

Mr Gilmore said no country wanted to see a crisis in its banking system. Cyprus’s banks were closed, and people were limited to taking €100 a day out of ATMs. The sequence as he understood it began some time ago when it was known that there were problems in the Cypriot banking system. A general election had taken place and there was a change in government.

“Discussions took place which resulted in an early proposed package of measures, some of which were favourable to the Cypriot government,” he said. “It was rejected by the Cypriot parliament and came back for further discussion.”

Serious and severe
Mr Gilmore said there was no doubt that what was happening in Cyprus was serious.

“The imposition of major levies on deposits and people’s savings has had a very severe impact. It is not a route that this country, thankfully, will go down.”

Incompetent approach
Fianna Fáil leader Micheál Martin said there had been an incredibly incompetent approach to the resolution of the crisis in Cyprus, which had been going on for nine months. He asked why Ireland had remained silent.

“Why did we not back Cyprus in this situation? It is extraordinary that Cyprus has been hung out to dry and that decisions have been taken which will have far-reaching implications for its sustainability as an economy into the future.”

Sinn Féin leader Gerry Adams said the Government had supported and welcomed the initial Cypriot deal, which was rejected by the Cypriot parliament. “That was entirely reprehensible and I would like an explanation for it.”

He said there was no point in being rhetorical about solidarity when the Government was on board for the taking of money from bank deposits.

Mr Gilmore said he found it interesting that when arrangements were initially agreed for Cyprus there were voices in the Dáil asking why Ireland did not do what Cyprus was doing.

“Last week, when the Cypriot deal was initially done, people asked why we did not follow suit and said it was a great idea. Now we know that those who were arguing one way now have an entirely different position.”