Tenth review of Troika bailout programme published

Thursday 13 June 2013 22.33
Department of Finance publishes tenth review of bailout programme
Department of Finance publishes tenth review of bailout programme

The Department of Finance has published the latest draft memorandum with the Troika of the European Commission, the European Central Bank and the International Monetary Fund.

The update gives further details of targets to be achieved by the end of this month - in time for the next review of the programme, which will happen in July.

The Department said the Government remained determined to leave the crisis behind, to ensure that the emerging recovery gathers pace and to ''meaningfully'' reduce the country's high unemployment rate.

It said it had met all the programme reform milestones set for the last quarter of 2012 and the first quarter of 2013.

However, a study on medicine costs was outsourced and was expected to be completed within the next few weeks.

Much of the memorandum focuses on the ongoing efforts to revive the banking industry, in particular targets and efforts for restructuring loss making mortgage and SME loans.

The Central Bank has already set targets for restructuring distressed mortgage loans this year, but the memorandum says it will publish a definition of a sustainable restructuring arrangement by the end of the month.

There will also be targets for each bank requiring them to complete a substantial amount of durable loan restructuring for small and medium sized companies.

And the Government is committed to preparing a stock taking report on progress towards addressing mortgage arrears by the end of the month, assessing the effectiveness of banks' restructuring and resolution actions.

As previously stated, the Central Bank will change the Code of Conduct on Mortgage Arrears, allowing banks to increase the number of unsolicited contacts they make with mortgage holders in arrears.

The Central Bank and Department of Finance will also report to the Troika on the exploration of options to lower the cost of funding of the banks' tracker mortgage portfolios.

Other aspects of the memorandum report on work to be undertaken by the state itself, which include making legally binding the spending limits set for government departments, as a means of better controlling government spending.

And the Government will publish a study comparing the cost of drugs, prescription practices and the use of generics in Ireland with comparable EU states.

The document also states that the authorities will announce a ''definitive time-plan'' for the introduction of water charges in the fourth quarter of 2014. ''Consultations will be carried out to determine the framework for water charges,'' the document added.