12 March 2017

The Government is pressing ahead with plans to sell-off 25% of AIB. Labour leader Brendan Howlin has called on those plans to be put on hold until guarantees are secured that the proceeds can be invested in Irish infrastructure.

Michael Noonan recently informed the Dáil that “the sale of any shareholding in any of the banks would not count as general government revenue. Therefore, there is not generally any increased capacity to spend as a result of the sale of shares without affecting the general government balance”.

Speaking today, Brendan Howlin said:

“For many months, I have been making the case for changes to the stability and growth pact in order to allow for greater investment in public infrastructure. Unfortunately, our Government has so far utterly failed to push this idea at a European level. The result is that none of the proceeds from any sale of AIB can be invested into building houses, hospitals or schools.

“The policy of selling off our holding in AIB was based on an urgent need to reduce our debt levels. But that situation has changed dramatically – net debt had already fallen to 66% of GDP, prior to the CSO publication of updated National Accounts last week, which will see this fall further.

“Diverting everything we get from selling a quarter of AIB would only reduce our debt by about 1.5% of GDP. The social good it could yield if invested in public infrastructure would be much greater.

“Representatives of both workers and employers have been pressing for much greater capital investment over recent months. The social case for greater investment in housing and hospitals is clear. The economic case for investment in transport and communications infrastructure equally so – particularly with Brexit on the horizon.

“Michael Noonan is now proposing to press ahead with the sale of 25% of our shares in AIB. But he tells us that not one cent of this can be invested in improving our infrastructure. The financial advisers working on the sale will stand to earn €40m from this action. But the Irish people will see no such benefit.

“Until we can secure changes to allow for the proceeds of this sale to be invested in much-needed capital infrastructure, it seems to me that this investment would be better left within AIB.”

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