asked the Minister for Foreign Affairs whether any conditions affecting Ireland attach to the setting up of the EEC Regional Fund other than those already publicly announced in Ireland.
Ceisteanna—Questions. Oral Answers. - EEC Regional Fund.
37.
The heads of Government at their meeting in Paris on 9-10th December, 1974, decided that the European Regional Development Fund should be put into operation by the Institutions of the Community with effect from 1st January, 1975. The Council is therefore now resuming examination of the draft implementing regulations which will govern the operation of the fund. These deal with such matters as the areas to benefit, the type of project to be assisted, the level of fund aid to particular projects and its financial administration. I anticipate that the Council will adopt these instruments in the near future.
I can assure the Deputy that no conditions were attached to the setting up of the fund.
May I ask the Minister for an assurance that no condition or consequence of the decision or no proposal is in being which would have the effect of bringing about the early termination of our export tax reliefs?
That certainly is another question and is not connected with the regional fund.
Did the Minister say that is not in the question?
It is quite a different question but I am quite prepared to answer it nonetheless if the Chair will give me latitude. That is a question that does not arise out of this. There is nothing in the Paris summit communiqué on this point nor was any decision taken at that meeting that related to that matter but, of course, the normal process of review of State aids is proceeding and the question of that and other State aids in all member countries comes up for review in due course under the arrangements negotiated by the previous Government in the Accession Treaty.
I am referring not to the normal process of review but either to the decision of the Paris summit or to the draft regulations which are at present being discussed and were referred to by the Minister in his reply.
I can give the Deputy that assurance. There were some suggestions by some countries, and I understand the Deputy's concern and it is quite right that he should raise the matter, that there should be a condition attached to the decision to go ahead with the regional fund. Those proposals did not meet with the agreement of the heads of Government in Paris.
And are now dead?
All that is happening, therefore, is the normal process of review of State aids.
May I ask the Minister for an assurance, on the same lines as I have got from him on that question, that there will be no suggestion, proposal or condition that industrial projects involving State assistance from our Government above a certain level, approximately the equivalent of 200 jobs at present rates of assistance, would require approval in Brussels?
I can give the Deputy no assurance on the particular point of what proposals will be put in the review of State aids.
I am referring to State aids. I mean only in relation to the decision on the summit and to the draft to which the Minister referred.
I can offer the Deputy an assurance that as far as the summit is concerned any suggestion of any condition being attached or anything of that kind was not pressed and was not agreed. Therefore, all that is happening is the normal process of review and we there have the provisions negotiated by the previous Government in regard to the export tax relief and what might happen if it came up for review.
Question No. 38.
May I take it that the Minister's assurance covers the proposals or draft regulations—I am not sure which term he used—which he said are now in the process of being prepared and discussed by the Council of Minister's in implementation of the summit decision on the regional fund?
The Deputy, I think, may be confused here. He is certainly beginning to confuse me. The regional fund regulations now being examined relate to the regional fund itself and they are coming forward at the next council meeting on 10th February, that is next Monday. The question of State aids is a separate issue and on the existing treaty provision the review of State aids is proceeding and the Commission are making proposals as to how they should be carried through and what conditions should apply to State aids. That is completely distinct from the Paris summit communiqué and distinct from the regional fund and any attempt to establish a linkage between the two was not agreed at Paris.
And is dead now?
Yes.
38.
asked the Minister for Foreign Affairs the present position concerning the question of economic and monetary union in the EEC, in view of the very small sum allocated to Ireland in the regional fund; and whether the Government's fears about the dangers of economic and monetary union have been exacerbated by the disappointing regional fund allocations.
At their meeting in Paris on 9-10th December, 1974, the heads of Government of the Community repeated the objective of establishing an economic and monetary union, an objective previously agreed in the Paris Summit Conference of 1972. Ireland, along with other member states, remains committed to pursuing the goal of economic and monetary union. Apart from supporting this aim in the context of European union as a whole, it can be argued that our own interests are best served by movement towards EMU. For example, it is important to this country to preserve the common agricultural policy, the functioning of which is seriously impaired by the continued absence of fixed parities between Community currencies. Of course, we consider that progress towards achievement of EMU in the Community should be accompanied by satisfactory progress in improving the decision-making arrangements in the Community and in ensuring that policy-making at Community level is brought under more effective democratic control involving for instance greater powers for and direct election to the European Parliament.
The heads of Government also decided to set up the European Regional Development Fund as from 1st January, 1975. For its first three years of operation (1975-77) the fund will be endowed with 1,300 million units of account (£542 million) of which Ireland will receive 84 million units of account (£35 million). In the view of the Government the annual amounts involved in this contribution of 84 million units of account, while being a useful addition to our domestic resources for regional development would be quite inadequate as a contribution to the Irish economy in the middle and latter periods of adjustment towards EMU when the pressures on the Irish economy that could arise as a result of these adjustments would require much more extensive action by the Community than is involved in the regional fund as proposed for the years 1975-77
Would the Minister agree that the regional fund as announced after the last summit will not be effective towards achieving economic and monetary union as enunciated by the Paris summit?
Yes, quite inadequate for that purpose.
In view of that would the Minister not think that it would have been desirable for our representation, particularly at the last summit, to enter a reservation to the summit communiqué to that effect, clearly indicating that it was not honouring the commitments of the Paris summit?
No, because the Paris summit discussed the question of the 1980 deadline for EMU and the wording of the Paris summit communiqué indicates clearly that that deadline is recognised as being unrealistic.
It is certainly rendered much more unrealistic now by the operation of the last summit. Is that not so?
Yes.
Does the Minister not think, in view of what he has said now about our Government's attitude, that it would have been well for our leader at the time to have expressed that reservation in that communiqué, as other Governments did about matters of vital concern to them?
No. In fact the EMU target of 1980 was not pressed and the communiqué wording makes it clear that it is no longer thought to be realistic. Therefore, the argument that we must now have a regional fund of a much larger amount to reach the EMU target of 1980 is no longer as relevant an argument as it was once the 1980 deadline argument was eroded at that point.
Is the Minister saying if you want to erode the target of the EMU you have a very simple way of doing it, that in fact you act totally contrary to your principles in the regional fund? Is that what the Minister is saying?
The Deputy is making a statement rather than asking a question.
No, I am not saying that. The progress towards EMU generally has not been good. It has, if anything, been in the opposite direction to the one intended. The necessary steps towards achieving that objective are not being taken in fields other than regional policy and consequently the target date is no longer realistic. This unfortunately from our point of view reduces the strength of the particular argument for a large-scale regional policy deriving from this EMU deadline.
(Interruptions.)
It is past the time for questions. A final supplementary from Deputy Wilson.
Would the Minister not agree that control by the European Parliament is far more important now that the currencies are in a chaotic situation vis-á-vis each other than if you had EMU? Would he not further agree that there is absolutely no will at all at the moment to produce a situation where there is economic and monetary union and that the whole talk of the summit is poppycock?
I think there is a recognition that we have moved backwards rather than forwards in the direction of this target in the last couple of years and the summit communiqué gently indicated that by its wording on this particular point.
The remaining questions will appear on tomorrow's Order Paper.