In Politics by Numbers, broadcaster, author and spreadsheet stan Gavan Reilly takes a data deep dive into a political point of the week.      

THE NEWS THAT Ireland is due to repay some of its debts from the EU-IMF bailout ahead of schedule is a reminder of an altogether more grim time in Irish life.

But we’ve heard so little about the bailout, and the lingering legacy debts it left us with, that for many readers it might be a bit of a jump scare to see it mentioned at all. For those with slightly firmer memories of that period (and I covered a lot of those events while working full-time for this website!) it might still be jarring to think there are debts we didn’t refinance along the way.

After all, Ireland made a very public gesture of repaying its IMF loans years ahead of schedule. The loans drawn down between 2010 and 2013 were only supposed to be fully repaid by the end of 2023, but such was the rebound in the Irish economy that we settled those debts in full by the end of 2017.

November 2010: Newspapers with headlines about the bailout. Alamy Stock Photo Alamy Stock Photo

Ireland also received bilateral loans from the UK, Denmark and Sweden. Sweden’s €600 million and Denmark’s €400 million were repaid in late 2017, up to six years ahead of schedule. The UK, which lent us stg£3.2 billion (€3.82 billion) and didn’t expect repayment until 2021, would also have been repaid years early except that its loan deal included a penal ‘brake clause’ which meant it would cost more to repay the money early.

But how did we repay these loans early? Ireland was not exactly awash with cash in 2016 and 2017. Where did the money come from?

The answer – and the key to understanding why the bailout was needed, and why the government is now talking about settling more of our bailout debts – lies in the interest rates governments pay to borrow.

How governments pay their own bills

The reason Ireland needed help from the EU and IMF to keep the lights on in 2010 was that the country was running out of cash. In good times, a country will run a........

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