Guest post by Andy Storey: Call for debt audit

Dr Andy Storey is a lecturer in the School of Politics & International Relations at UCD. A number of prominent Irish academics, writers and activists have backed a campaign to audit Greece’s public debt, amid suggestions that such an audit might also be required in Ireland. Greek campaigners are calling for an independent and international Audit Commission to find out why the debt was incurred and the uses to which borrowed funds were put. As Costas Lapavitsas, one of the organisers of the petition, puts it:

“Can we be certain that the bulk of Greek public debt is legal, given especially that it has been contracted in direct contravention of EU treaties which state that public debt must not exceed 60% of GDP? The creditors – mostly core European banks – were fully aware of flouting this legal requirement when they lent to the Greek state. Is Irish public debt legitimate, given than much of it is speculative bank lending with a public tag placed on it? Is debt in both countries ethically and morally sustainable if servicing it implies the destruction of normal social life?”

Debt audits have been used across the world to allow civil society to hold to account those responsible for the damage caused by their countries’ indebtedness. An audit in Ecuador in 2008 encouraged President Correa to default on some of Ecuador’s most unjust debt, leading to a write-down by borrowers. Two former Ecuadorian ministers are amongst those who have signed the call to support an audit in Greece.

One of the most alarming aspects of the Irish debt crisis is the lack of transparency or clarity on the numbers involved. For example, the Irish Central Bank says that total Irish bank bonds outstanding amount to €63.4 billion, but Goodbody stockbrokers put the figure at €59.4 billion, while NCB stockbrokers come up with an estimate of €74.8 billion. When we get down to the detail of who this money is owed to, it gets worse. For example, a repayment of €750 million was made by state-owned Anglo Irish Bank in January this year to a creditor who was not covered by the bank guarantee but we do not know who that creditor was and why an unguaranteed debt had to be honoured. An Irish debt audit would allow us answer such questions.

The full list of Irish signatories to the Greek debt audit campaign is:
Professor Sean O’Riain, Head of Department of Sociology, National University of Ireland, Maynooth;
Cathleen O’Neill, Community Activist, Kilbarrack Community Development Programme, Dublin;
Frank Keoghan, General President, Technical, Engineering and Electrical Union (TEEU);
Des Derwin, executive member, Dublin Council of Trade Unions;
Professor Peadar Kirby, Director, Institute for the Study of Knowledge in Society (ISKS); Professor of International Politics and Public Policy, Department of Politics and Public Administration; Member, Governing Authority, University of Limerick;
Professor Cormac O’Grada, School of Economics, University College Dublin;
Dr Iain Atack, International Peace Studies, Irish School of Ecumenics, Trinity College Dublin;
John Baker, Associate Professor of Equality Studies and Head of School of Social Justice, University College Dublin;
Fintan O’Toole, author and journalist;
Kathleen Lynch, Professor of Equality Studies, University College Dublin;
Denis J. Halliday, former United Nations Assistant Secretary-General;
Kevin O'Rourke, Professor of Economics, Trinity College Dublin;
John Maguire, Professor Emeritus of Sociology, National University of Ireland, Cork;
Jimmy Kelly, Irish Regional Secretary, UNITE Trade Union.