Iceland petition against pay-out over Icesave collapse

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Organiser Magnus Arni Skulason explains why Iceland's president is being petitioned

Almost a quarter of voters in Iceland have signed a petition against plans to repay money lost by foreigners when an Icelandic online bank collapsed.

The petition urges the president to veto the bill that allows the move, and calls for a referendum on the issue.

Iceland's parliament has approved the plans to reimburse 3.8bn euros (£3.4bn) lost by Dutch and British savers when the Icesave scheme failed in 2008.

Many taxpayers say they are being made to pay for the bank's mistakes.

The compensation amounts to some 12,000 euros for each citizen on the island nation of 320,000.

Staggering payments

A poll taken in August suggested that 70% of Icelanders were against the deal, which was approved by Parliament earlier this week.

More than 56,000 - about 23% of Iceland's voters - signed the petition urging President Olaf Ragnar Grimsson not to sign the bill.

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I was one of the first to sign this petition. This is such a serious matter that any agreement must be made with the general public

Michael J Clarke, Akureyri, Iceland

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Magnus Arni Skulason, one of the organisers of the petition, compared the repayment to financing the country's health service.

"We were able to represent our arguments to the president, and also on the occasion we handed over a petition to ask the president to reject the current Icesave bill," he told the BBC.

"The interest rate on the Icesave agreement for Iceland is like running the National Health Service of Iceland for six months."

The Icelandic government had threatened to resign if the deal was rejected by MPs.

"Approving the bill is the better option and will avoid even more economic damage," Finance Minister Steingrimur Sigfusson said during the debate.

Icesave - the internet arm of Icelandic bank Landsbanki, which offered high interest rates - failed in October 2008.

An original agreement negotiated with the British and Dutch governments was approved in August.

But subsequent amendments negotiated by the prime minister were rejected in both countries, forcing a fresh vote.

Under the new deal the money - which represents 40% of the country's GDP - will be repaid gradually, staggered until 2024.

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