This included a guarantee of liabilities in the banking sector; a series of pro-cyclical, contractionary budgets; and capital injections into the domestic banks. By late 2010, Ireland’s fiscal position was unsustainable.
The government agreed to enter an EU IMF support programme, with a total size of € The resulting adjustment programme brought additional contractionary budgets (albeit they would have had to be even more austere if Ireland had had to raise market-based funding, compared to cheaper, three-year official funding), public sector pay cuts, further banking stress tests, and more capital injections.