Good morning – and thanks for joining us. We’re carrying proceedings from Government Press Centre, where finance minister Michael Noonan and his public expenditure counterpart Brendan Howlin are set to give a press conference on the outcome of the latest Troika review.

The report today marks a full year since the first review of the EU-IMF, which became the basis for the first Memorandum of Understanding – essentially the terms and conditions that underpin the €67.5 billion loan from the Troika to Ireland.

Unsurprisingly, things are running a little behind schedule – but that’s not likely to be much of a surprise, given the organisational chaos behind arranging briefings for ministers and separately for the Troika itself.

Earlier this morning, during Order of Business at the Dáil, Tánaiste Eamon Gilmore was at pains to tell Sinn Féin’s Mary Lou McDonald that the Government isn’t just looking for “gold stars” from the troika. The country is on the road to minor recovery, he said, and it would behove her and her party (‘behove’ is our word – we like it) to “pull on the green jersey” and support the Government in its attempts to get the country moving.

Mary Lou didn’t like the “pull on the green jersey” remark. She claimed that the bailout had failed because it hadn’t, a. gotten Ireland back into the markets, and b. not achieved a reduction in our deficit. Nothing had changed she said. Gilmore wasn’t having any of it – Irish 10-year bonds are in a much better state facing into 2012. It is “time to grow up” and for Sinn Féin to offer some positive solutions to the crisis rather than “coming in here every Thursday bellyaching”. So that was the Dáil this morning.

Notably, both parties were slightly misleading in their Dáil complaints about the Irish 10-year bond – because right now there aren’t any Irish ten-year bonds. There’s a few Irish bonds maturing in 2020, and another one in 2025 – but there aren’t any bonds maturing in 2022. (Which, in some ways, is convenient – it means Ireland’s bond yields can’t get any worse…)

As you can hear (if you’re reading us through the web), the mics have been turned on in Government Press Centre. That’s usually a pretty good sign that things will kick off imminently.

Or, in this case, maybe not…

And here we go…

“These reviews are becoming almost routine,” opens Michael Noonan, explaining that reviews take place each quarter, and each review is required in order to release the next batch of bailout funds.

Michael Noonan said Ireland had met its EU/IMF targets, so the crux of the review was actually looking at things in the future.

Ireland will publish a Fiscal Responsibility Bill in the second quarter, he says – this has been kicked back slightly in order to make sure it doesn’t conflict with the latest EU treaty.

Legislation on personal debt is coming in April; Noonan says this delay is not due to disagreements between himself and Alan Shatter, but rather that the legislation is simply very tough to write.

Irish Life and Permanent – The insurance end was practically sold to Canada Life before Christmas, who decided to pull out when things went sour just before Christmas. “There isn’t a difficulty with that”, Noonan says, ensuring that a delayed sale may mean a slightly better price. The Permanent TSB side will be agreed this quarter.

The 2012 stress tests will be in the autumn; “We think it’s prudent and sensible, rather than having [tests] on our own initiative, if we simply align the timing with the general round of stress tests in the European Banking System”.

Brendan Howlin: “The three institutions are permanently here,” so interactions aren’t just once per quarter. “We have good allies in the Troika now.”

BH: It’s important to acknowledge, although we take it as a given, that we are “very successfully implementing” the programme agreed with the Troika. The Troika, as will be evident in their own press conference, has indicated to us that we’ve met all the targets that we’ve set. Some 90 different actions have been set and achieved to date.

On the sale of state assets: We will sell when the time is right, and regulatory systems are there. We’ve allocated €250m, leveraged up to €1bn, to the NewERA fund for projects which can create assets in the future.

Howlin: Ireland has “made progress” in trying to ensure that the cash from state assets can be reinvested, and not simply used to pay off the debts. There will be “no fire sales, there is no pressure of time on us”. The sales will be done on a strategic basis to ensure the best payoff.

The first question, from TV3′s Brian O’Donovan, asks whether one can judge that targets have been met when so many things have been delayed. Howlin says it’s up to the EU-IMF to judge that, and they say we’ve passed – and again underlines that state assets will be sold only when the price is right.

Noonan: The delay in selling Irish Life was entirely of Ireland’s own choosing, and the Troika is not pushing a timeline – Canada Life will buy when the time is right.

A question from Raidió na Gaeltachta, asking for a summary of the dialogue with the Troika. Noonan duly obliges, explaining that most targets have been met with a slight adjustment in the timeline for others.

Harry McGee from the Irish Times asks again on the clarity of which assets have been identified for sale. Howlin: In the last memorandum of understanding, the phrase used was “an ambitious programme” of sales, though with no financial target. On foot of that, two reports have been ordered and will be brought to guaranteed soon. He won’t give precise details.

Noonan: Ireland’s deficit for next year will be somewhere around 9.8 per cent of GDP, significantly less than the 10.6 per cent required. This is helped by the good headstart we got for this year, he says.

That sound was Michael Noonan sneezing. Apologies for that.

Howlin speaks about the public spending reform, and says the Troika isn’t bothered about spending in individual sectors, but rather about the bottom line. It’s not looking for concessions on public pay, for example.

Paul O’Brien, also from the Examiner, asking about pleas for the ‘green jersey’ urged by Eamon Gilmore (see 11:59). Isn’t that dangerous given what happened when regulators pulled on the green jersey?

Noonan says he didn’t hear Gilmore’s comments earlier, so he’s not willing to speak to them, but that this is the greatest crisis facing Ireland since WW2 and that it’s not helpful to ‘grandstand’.

Sean Whelan, RTÉ, on the proceeds from the sale of state assets, asks for some elaboration – and also for the Croke Park public service pay deal…

Howlin, on the latter, says public pay has been cut by an average of 7 per cent – and by up to 40 per cent in some cases. There are new pay caps, which are “very radical changes”. Similarly, pensions will be less generous into the future. There’s no Troika pressure in terms of the methods we use.

Howlin points out that if pay is cut, it’s also sucking spending power out of the economy, which isn’t a good thing for the economy as a whole. He adds that, by and large, the majority of public workers aren’t brilliantly paid.

On state assets… there’s a “significant change”, where Ireland has secured a position “where it’s acceptable that a sizeable portion of sale asset funding could be used for productive job-creating purposes.” That, it must be said, is a big concession to win.

Robert Shortt, RTÉ: Was the issue of funding bank debt raised this time? And did the Troika express concern about hitting our targets given that growth expectations have fallen short?

Noonan, on the latter: there was nothing specific. There was discussion on the possibility of ‘substituting’ promissory notes with something better, for Ireland, and “technical work” was going on by each party of the Troika. “There is now agreement that they pool their resources” to agree a common policy position,” he says. That’s worth noting – the Troika is now actively considering something to replace the promissory notes, which are costing Ireland some €31bn (plus interest) in the next ten years.

The benefit of this, Noonan says, is that it will now be a proposal coming from the Troika – with inherent EU backing – rather than merely an Irish one.

The BBC’s Mark Simpson, on emigration - asking if there are any projections built into the system. Noonan says the CSO monitors that, and these aren’t specifically factored into the process, though they naturally have an impact on the number of people working, and the numbers seeking social welfare. “There are always young people coming and going from Ireland,” he says, somewhat dismissively.

“It’s not being driven by unemployment at home, it’s being driven by a desire to see another part of the world and live there.” He has three kids abroad, and their emigration was a lifestyle choice.

“What we have to make sure is that our young people have the best possible education, right up to third level,” so that when they leave they’re employable in other countries at the best possible levels, Noonan concludes.

An unnamed reporter asks if the Troika raised the possibility of Ireland rejecting the fiscal compact. Noonan says it’s not a Troika issue, and then goes on to say the drafting is a “rapid process”. The discipline the treaty imposes is less rigorous than the discipline we’re under already – so Ireland’s only concern is how it be adopted. Naturally, the Irish government would prefer to avoid a referendum.

The Irish Times’ Simon Carswell, about the banking system… have the Troika been flexible in terms of giving the banks more time to downsize? And what about IL&P? Noonan says the IL&P plans are still largely on course, and the government has no plans to wind down. In terms of deleveraging, the government is keen to make sure it doesn’t happen so quickly that the banks lose their lending power.

Justin McCarthy, Today FM: What if the Troika’s expectations of growth are right, and our own (more positive) ones are wrong? Noonan: Progress has been made “beyond my expectations”, when you consider the damage to Ireland’s reputation from this time last year. He never thought we’d have saved €10bn by halving our bailout interest rates, and getting an extra year to meet the deficit targets.

Noonan: In a couple of year’s time when people look back, and decide whether Ireland’s programme was successful, the test will be whether Ireland is back in the markets or not. To enhance that, we’re looking at changing the promissory notes. He points out that, this morning, Irish 10-year bonds (again, what 10-year bonds? See 12:08) was 7.3 per cent, and five-year bonds were at 6.2 per cent. That’s close to “affordable” levels.

In response to another question, Noonan again underlines that the ‘debt brake’ legislation has been “paused” because a lot of it overlaps with the requirements of the new EU treaty, which will have its first political talks when finance ministers meet in Brussels next Monday and Tuesday.

RTÉ’s Ingrid Miley: What’s the unemployment target originally set in the target, for this point in time? How will we reform the ‘inability to pay’ mechanisms? And what’s the Troika saying about the impact of “raiding the pension fund” (Howlin shakes his head) further down the line?

Noonan: The pension levy raised funds to create employment. It’s part of the original memorandum of understanding that pension reliefs in Ireland are “too generous”. They wanted to pull down the tax relief, so what Noonan did was announce a dialogue with the pension industry to review this.

“There’s no unemployment budgets in the programme” (on the current level: “I don’t know is it 14.3 or 14.4?”) but Richard Bruton has another programme for job creation to be announced next week.

Howlin vocally disagrees with suggestion that we “raided” the NPRF – although it’s being used as bailout collateral, that cash can still be used to help create jobs. “There is an understanding that unemployment is above the line in terms of the restrictions on social protection spending” – that is, unemployment spending isn’t subject to Troika restrictions.

And that’s that – with a largely off-mic exchange including the words “don’t be cynical”, the press conference comes to an end…

So – what do we know?

- Legislation on personal debt is coming in April, and will allow all people in debt – including those in mortgage debt – to have access to some kind of judicial or non-judicial way of relieving their debt;

- A tactic for the sale of Permanent TSB will be agreed this quarter; the sale of Irish Life to Canada Life will still go ahead, but whenever market conditions are favourable;

- The 2012 stress tests will be delayed until the autumn, to run parallel to those happening elsewhere in Europe;

- Ireland has secured a position where a decent chunk of the proceeds from selling state assets can be invested in job creation;

- The Troika is coming up with a common negotiation position on replacing Ireland’s promissory notes (which are costing us €31bn, plus interest).