The Troika returned to Dublin this week to check we can still run the economy, and there is sure to have been mixed feelings among the delegation as regards what they found.
A European Commission official said the aim of the visit was to "inquire about current budgetary and economic developments" and to "learn in more detail about the plans of the new Government".
But fingers have already begun to wag in relation to the Government's commitment to EU deficit and debt targets, and Enda Kenny could be forgiven for wishing the Irish Fiscal Advisory Council (IFAC) had waited for the Troika to depart before delivering its latest economic assessment.
It said the Government needs to find an extra €6 billion just to stand still in terms of public services over the next five years. The estimate was said to reflect the likely spending pressures posed by inflation and changes to public sector pay alongside an ageing population.
In something of a slap down to the Government, it said its medium-term projections for the economy “significantly understated” these pressures and failed to give “an informative picture” of the public finances after 2016.
So, if you remember all those goodies that were promised during the general election campaign, only about half of what Minister for Finance Michael Noonan said he had in the kitty is in fact there.
But, before anybody panics, the Taoiseach has declared the crisis to be over. Speaking in the Dáil this week, he said the bad days were behind us, and, as such, he has no intention of restoring the Economic Management Council. What was the economic equivalent of a war cabinet, comprising the leaders of the two coalition parties and the Ministers for Finance and Public Expenditure, has been disbanded. Of course, it would have been just himself and Noonan these days anyway.
Nama’s annual report
Economic growth may be flying, and the public finances are under control, but there are plenty of reminders of the financial crash still to be found all around. The National Asset Management Agency (Nama), set up in 2009 to dispose of €74 billion in risky commercial property loans, published its 2015 annual report on Wednesday.
It showed Nama generated €9.1 billion in cash during the year, with €8.5 billion coming from asset disposals. It also raised its lifetime surplus forecast to €2.3 billion after reporting that net profit had soared almost 300 per cent last year to €1.8 billion.
Michael Noonan indicated some of the profits may be used for a so-called rainy day fund to shore up the State finances against future shocks. The Troika would be proud. Noonan also said the Government is examining a scheme to buy social housing that will keep the cost off the State’s balance sheet.
Legislators have been debating since the formation of the Government as to how the State might solve the housing crisis without breaching EU fiscal rules. One possibility being considered is to set up a subsidiary called Nama Asset Residential Property Services (Narps) to purchase houses from developers to lease them to local authorities.
Anglo trial ends
There must have been a collective sigh of relief in the jury room at the Criminal Courts of Justice on Friday when the longest trial in the history of the state finally drew to a close.
Denis Casey, former group chief executive of Irish Life and Permanent (ILP), was found guilty in the trial of four former bankers accused of conspiring to mislead investors and the public in relation to the financial health of Anglo Irish Bank in 2008.
On Wednesday of last week, the jury returned guilty verdicts in relation to former finance director of Anglo, Willie McAteer, and former Anglo head of capital markets, John Bowe. On Friday it delivered a not guilty verdict in relation to former finance director of ILP, Peter Fitzpatrick. The trial lasted 89 days.
In effect, the jury concurred with the State in the case of three of the men that there was no commercial substance to a series of transactions in September 2008 between Anglo Irish Bank and Irish Life & Permanent. Their only purpose was to deceive.
Separately, the Department of Finance, in briefing notes to Michael Noonan, has suggested that Permanent TSB could be merged with another financial institution to boost its long-term viability. "There is the possibility of mergers and acquisitions activity to drive value and improve long-term viability for the bank," it said.
Eir stake
There were some exciting developments in company news also this week. The Qatari royal family's $256 billion (€225 billion) investment fund is being lined up to acquire a major stake in Eir, formerly known as Eircom.
With a flotation not expected for at least two years, the company's second-largest shareholder, York Capital in the US, is selling up its 15 per cent stake to the Qatar Investment Authority (QIA), the tiny oil-rich state's sovereign wealth fund. It is understood that New York hedge fund Anchorage, which owns almost 38 per cent of the company, will remain the largest shareholder.
BOD’s new role
Elsewhere, former Ireland and Lions rugby captain Brian O'Driscoll joined the sports division of New York-based global advisory firm Teneo Holdings as a senior adviser. He joins a list that includes Senator George Mitchell, and former British foreign secretary Lord William Hague.
Mike Ashley
In the UK, Sports Direct boss Mike Ashley was appearing before MPs on Tuesday. The company is accused of exploiting workers. In an extraordinary performance, he admitted the retailer was "too big" for him to know everything that went on there.
He accepted, for the first time, that too many staff at the company were employed on zero-hours contracts rather than being given permanent jobs. He also conceded Sports Direct’s policy of docking 15 minutes pay if a worker was just one minute late for their shift was “unacceptable”.
Brexit warning
More and more stakeholders have been having their say – and indeed reiterating their say – on the British referendum on EU membership. Rating agency Standard and Poor’s warned the Republic would be at “the frontline” of states most exposed in the event of a Brexit.
Sterling bounced about half a per cent against the euro and dollar on Tuesday after a pair of polls gave a narrow lead to the Remain camp ahead of the June 23rd vote. The pound had sunk to a three-week low in trade-weighted terms on Monday.
British chancellor of the exchequer George Osborne warned that Brexit would cause a "profound economic shock" in Northern Ireland and lead to an "inevitable" hardening of the Border.
Mr Osborne also cited new analysis to suggest a UK vote to quit the EU would cost thousands of jobs in the North. Just in case we didn’t get the message, he also said it would result in a “negative spill over effect” in the South.
“The impact of the shock from leaving the EU and the free-trade single market – the largest in the world – could be equivalent to a £1.3 billion reduction to the size of the Northern Ireland economy by 2018,” he said.
The analysis indicates that a Leave vote would cause unemployment to rise in the North by about 14,000 over two years, while youth unemployment would rise by 2,000.
