With the permission of the Ceann Comhairle I should like to make a statement to the House about the recent meeting of heads of Government of the countries of the European Economic Communities, accompanied by their Foreign Minsters, which was held in Brussels on 16th and 17th July. The House will know that these meetings are intended primarily to provide opportunities for heads of Government to reflect together on the problems of the Community, and on issues of foreign policy of common concern to the nine member states. On some issues the European Council may provide an orientation for future policy—as was done at the Dublin Summit, for example, when the heads of Government reached agreement on a solution to the problem of the possible inequity of financial contributions by member states to the Community. But primarily they are occasions for exchanges of views, leading in many cases to subsequent decisions by the appropriate agencies.
The agenda for the last meeting covered an exchange of views for development prospects of the Community, following the British referendum, the economic situation, including international monetary problems, energy problems and problems related to raw materials and development of the less-developed countries of the world.
It follows from the form of the meetings that there should be no formal communiqué. At the same time, certain declarations or statements are essential to record the conclusions or trend of the discussions. Statements issued on this occasion covered the economic and monetary situation; certain aspects of European Union; the United Nations, and Portugal. I am arranging that these be laid before the House.
Deputies will be aware of the concern which I expressed at the meeting of heads of Government in Paris in December, 1974, that the evolution of the Community should be accelerated. We regard the early holding of direct elections as an important step in this direction. The decision to bring forward to 1978 the date from which such elections should be held was in our view an important development. Only by involving the people of the different countries of the Community in its processes and decisions can its development be ensured. We must reduce the feeling of remoteness of the Community from the practical world and the practical concerns of men and women of our countries.
As Deputies will be aware, Britain and Denmark entered reserves in the communique issued after the Paris meeting of December last, on the question of direct elections. At this meeting these two countries joined with the rest of us in agreeing that the Council of Ministers should study the matter, taking into account the proposals made recently by Parliament and should report back at the end of the year. At the same time the meeting decided to initiate work on proposals for a passport union and for the establishment of some basic rights for citizens of the Community in each others' countries.
The most important problems to be settled immediately in relation to direct elections, apart from the membership of the different countries, concern the method of election of the members, the constituencies they will be expected to serve and questions relating to dual membership of the European Parliament and the Parliament of the country they represent. These questions involve such issues as the basic purpose of membership of the European Parliament and perhaps also, in a related way, the question of a bicameral parliament for Europe.
The basic purpose of direct elections, passport union, new arrangements for meetings of the European Council and so on is to improve the institutions of the Community and maintain the momentum for its development. It is essential that they should be approached with a sense of purpose and urgency. The Community cannot play its proper role in the world, or indeed in the affairs of Europe, unless its institutions are accepted and work on a sufficient scale with efficiency and humanity for the achievement of the basic social and economic aims of the Communities.
In relation to the external or political questions before the meeting of heads of Government, Deputies will by now be aware of the situation in Portugal, the meeting heard an evaluation of the situation in that country by the Minister for Foreign Affairs, who visited the country as President of the Council of Ministers a short while ago. The meeting decided to confirm the willingness of the Community to discuss closer economic and financial co-operation, indicating at the same time that in accordance with the Community's European policy and history to date it could only support a pluralist democracy.
The meeting approved a statement on the Conference on Security and Co-operation in Europe setting out their evaluation of the conference. The statement is to be issued if the stage of the conference currently in progress in Geneva concludes in the immediate future. The conclusions of the conference will be signed by the heads of Government of 35 European states at Helsinki at a third and final stage of the conference, which on present plans will be held between the 30th of this month and the 1st of August.
The fourth international issue considered by the heads of Government was the position of the Community vis-á-vis the United Nations. We made it clear in our statement that we regard the United Nations as the main organ of international co-operation and will set aside any obstacles to coordination of our countries' views so that the Community can act to promote conciliation and dialogue and consequently a strengthening of the United Nations. In particular, as regards the special session of the General Assembly devoted to development and international economic co-operation, which is due to take place at the beginning of September, we stressed determination as a Community to promote a more equitable and balanced economic order.
Important as were the institutional and external matters which we discussed, the main emphasis of the meeting was on the economic situation. We devoted a considerable part of our time in Brussels to the discussion of energy, raw materials and development. Our interest in the matter can be gauged from the fact that in 1973 we imported some £67 million worth of oil and oil products. In 1974 this figure had risen to about £208 million for a slightly lower volume of the same products. In 1973 we imported some £90 million worth of what can on a certain definition be described as raw materials. In 1974 the comparative figure was £144 million, again for a slightly lower volume.
There is the further point that much of our oil and raw materials comes from developing countries. These countries have urged that the trade in commodities should be so organised that the return to the producer is remunerative and the price to the consumer fair while long- and short-term arrangements are made to guarantee supplies. Difficulties of which Deputies will be aware have arisen in relation to a conference between producers and consumers of these commodities. I am glad to say that so far as the Community is concerned these difficulties were largely resolved at our meeting.
The real concern of the meeting was the economic situation as it faces each country of the Community today. We had a long and full discussion of the economic problems we all face.
I cannot, I am afraid, report much optimism among my colleagues. All are agreed that the world economic crisis is much more severe than anyone had anticipated and that it is far from resolution.
The measure of the deterioration in our prospects and of its sudden and unexpected character may be seen in the fact that when we met here in Dublin only four months ago the expert advice given to us was to the effect that, despite the difficulties we had faced, the Community would secure an increase of about 1½ per cent in its output during the current calendar year. The day before yesterday, however, we were told that the prospect now is not for growth but for a decline of 3 per cent in Community output this year.
The March forecast was for a level of unemployment of about 3.5 per cent for the Community as a whole. Unemployment has now passed 4 per cent, or more than 4,000,000 people. In Europe today there are more people out of work than the entire population of this country.
It is on these countries of the Community and on countries like America, Japan and more recently the oil producers, that we must largely depend for revival and growth. In 1974 our exports were equivalent to almost half our total output. We are more dependent for our prosperity on world revival than is any country of the Community.
The message is clear. So far as economic growth is concerned we are largely at the mercy of external forces. It is what is happening in Europe and in the outside world that determines our growth rate.
Let no one be surprised at this. It is not just this small island that is facing forces beyond its control. A grim feature of this meeting was that the heads of the Government of the states in the Community were quite clear that their countries—some with economies 30 to 40 times larger than ours—could not control their own future development either and indeed that the Community as a whole, acting together, with all the power of a wealthy economic unit of 260 million people, could not without the support of other great economic powers notably the United States and Japan, control its economic destiny. The present recession may perhaps be in the control of the major industrialised nations, if they all act together, promptly and intelligently. It is not within the compass of anything less than such a concentration of policy by these great economic powers to set the world economy on its course again.
We in Ireland have to face this reality. There is no tap of economic growth that we can turn on. We must not delude ourselves that such action is open to us, when it is not even open to the Community to which we belong. At the same time the task of fighting unemployment, especially in an economy such as ours, is made more difficult by the surrender to the Community, in the interest of common policies and common rules, of power to implement appropriate measures. The blunt fact is that the reduced capacity of individual Governments to protect their people's jobs and living standards has not yet been counterbalanced by a growing capacity on the part of the Community to make good this deficiency. We have failed to marshal the enormous economic resources of the Community in an effective way. I may say, however, that I took some comfort from the fact that the possibility of action as outlined by the Commission is contemplated over the next few weeks.
I do not say these things or take this attitude to imply that there is nothing we here in this country should or can do. What we can do, and must do, is to face—all of us—the grim reality of economic decline and the threat of worse ahead. We must not delude ourselves that now our economy can grow or our living standards rise. Indeed, in the light of the situation now facing us, and Europe and the world, our aim of maintaining the living standards of our people is obviously at risk. There can be no improvement in living standards for some while the economy as a whole is showing a decline. There simply are not enough resources available here or elsewhere in the Community to give everyone what they enjoyed in the recent past. Our problem is no longer how to distribute increased wealth but how to spread the reduced resources available to us, as to our neighbours, so as to minimise hardship. In these circumstances, no group in our society can secure additional resources for itself over and above the increases in remuneration designed to keep pace with the cost of living without imposing hardship on others, either through pushing up prices further or by putting other people out of work.
In seeking to minimise hardship in this grave situation we in Ireland have sought to proceed through consultations with the major groups representing the social partners in our country. I am glad to be able to tell you that this process is about to be paralleled at a Community level. Yesterday morning the President of the European Council, Signor Moro, and the President of the Commission, Monsieur Ortoli, met representatives of the European trade unions. When the President of the Council reported to us on his constructive talks with the European trade union leaders, we agreed—and I strongly supported this initiative—that a tripartite conference should be held after the summer break between the Council of Ministers of Finance and Social Affairs and the representatives of trade unions and management in the Community. Joint discussions of these problems by these councils is, of course, something which the Ministers for Finance and Labour in our own Government have been seeking to secure during the past six months of the Irish Presidency.
I went to the meeting of heads of Government convinced of the seriousness of the recession which at present faces us. At the meeting, I heard the German Federal Chancellor, the French President and the Prime Minister of the United Kingdom, among others, give their view of the prospects for their countries, which together account for a substantial part of the trade of the entire world. Their view confirmed what I and the other Ministers have been saying. The present recession is not confined to one country. No one country alone can fight its way out of it. But if any country, particularly a small country with a comparatively underdeveloped economy, like ours, takes the wrong measures, or if interests within it from greed or ignorance of the true position fail to make the contribution now which is necessary for the wellbeing of all, then indeed the future will be as bleak for many more as the past has been for some.
That is the principal lesson that we have to draw from this European Council, from which I and my colleagues have returned to our respective countries in a mood of realism— a mood which I must share with this House, and, through it, with all the people of the country.
