asked the Minister for Finance if his Department has contingency plans to break the Irish pound from its traditional link with sterling; and if he will make a statement on the matter.
3.
Ceisteanna—Questions. Oral Answers. - European Monetary System.
2.
asked the Minister for Finance if the Government have given any consideration to contingency arrangements in the event of a break with sterling, arising out of the new European Monetary System.
With the permission of the Ceann Comhairle, I propose to take Questions Nos. 2 and 3 together.
The implications of a break in the traditional link between the Irish pound and sterling have been under constant review for some years past. As the Deputies will be aware, successive Governments have taken the view that a decision to continue or to change the present relationship must be based on an assessment of where the balance of economic advantage lies. The whole question of our exchange rate arrangements is currently being considered in the context of the proposals being elaborated for a new European Monetary System. I can assure the Deputies that all the implications, including operational aspects, will be fully examined.
Has the Minister contingency plans for the adverse effect that could result in the export section of our income if the Irish punt is revalued upwards against sterling?
As the Deputy is aware it is planned to have a debate in the House on this matter next week in the course if which I hope to outline the implications under various headings, including the one mentioned by the Deputy. It is difficult to go into it in detail at Question Time.
The Minister referred to the early publication of a White Paper and I should like to know if he could tell the House, in advance of our debate next week——
Is the Deputy referring to the next question?
No. The Minister has referred to a transfer resource of £620 million and I should like to know if he would indicate to the House the basis of calculation. He has said that this £620 million would be sought by us over the next five years if we see our way into this new currency arrangement and I should like to know on what figures or calculations that £620 million is based. It appears to be inadequate for the kind of difficult adjustment that would occur in the period of our currency realignment and the country is guessing on what figures the Minister has set his figure of £620 million which he apparently is seeking.
With due deference to the Deputy I do not think that arises on these questions; it may be a matter to be covered in the course of next week's debate. The calculation of figures of that kind rest on quite a number of fairly complex issues. It should be borne in mind that in so far as that figure has emerged publicly I do not think it emerged from me. It represents a stage in negotiations which are going on at present. It is not necessarily a final position.
Would the Minister agree that it is not wise tactics in negotiations of this complex nature to give as the upper figure of our request the £620 million, a figure which appears to the Opposition to be inadequate in view of the rather excruciating adjustments that will occur in the Irish economy if we find ourselves in line with this new currency? There is a public impression abroad that realigning our currency with the new European one will give us a bed of roses situation.
The two questions before the House relate to contingency arrangements and I cannot permit a question on anything else.
Is it wise that the Minister should give as the upper figure in his negotiations on the transfer of resources a figure of £620 million which appears to be inadequate?
The Deputy should bear in mind that a great deal depends on the form of aid, if I might call it that, which might become available in the concurrent studies. As of now there is no guarantee that any such aid would become available but, as to what would emerge, a great deal would depend on the format it would take and what it would be directed to. It is not possible to indicate at this stage in the negotiations what would be the optimum position for us having regard to the fact that the final version of the form it might take has not yet been determined. The most I can hope to do in the course of the debate next week is to indicate the current state of play but we would not be in a position to indicate the final position arising and, therefore, to make an assessment. Indeed, the Deputy would not be in a position to make an assessment of what should be required as a result of that.
Is it the upper limit of our transfer resource that we are seeking?
I have indicated that it is not the final figure.
The figure of £620 million was reported in the newspapers and the Minister has told us that it did not come directly from him but I am sure the newspapers did not pluck it out of the air either. There must be some basis for that figure. I am sure the Minister will appreciate that the calculations by which this figure was arrived at would be of assistance during next week's debate and during the substantive debate that will take place later. I should like to know if he would give us an indication of how this figure or whatever figure he has in mind was arrived at? If he gives it to us next week it will be of great assistance.
I will certainly give deep consideration to that but I am sure the Deputy will appreciate that that was not the question I was asked.
4.
asked the Minister for Finance whether the publication of a White Paper setting out the implications of our joining in the proposed new European Monetary System is under consideration; and if he will make a statement on the matter.
As the Taoiseach indicated to the House yesterday, a paper will be provided for the purpose of the substantive debate on the question of our joining the proposed European Monetary System.
Would the Minister agree that, if this White Paper is to be an authoritative introduction to a national debate on this very important subject, it should include in the appendices some of the background papers our negotiators used at EEC Ministers level?
The content of the paper can only be decided when the final form of the proposed system has been decided. The paper will be directed to informing the House, and the public, of the position then obtaining. As to what should be the precise content of the paper I can not say.
Would the Minister indicate whether the Government are committed in principle to association in this new monetary system? The Government appear to be committed in principle to joining that system.
That does not arise on this question.
I was curious about the policy direction of the White Paper.
I do not accept that the Government are committed in the sense that that word is normally understood. It is true to say that we would wish to join the European Monetary System, something which has been stated by other members of the Government, but the decision as to whether we should do so or not must depend on the final version of it and an assessment of its impact on our economy. No such decision has been made and cannot be made at this stage.
Will the White Paper set out the options that will arise for us? Will it put forward the position that will arise if, for example, Britain does not join in the new monetary arrangements? It would be foolish for us to assume that Britain is taking a direction one way or another. Will the White Paper address itself to that question? What will we do in those circumstances?
As I have already said, it is not possible for me at this stage to anticipate the content of this paper, but I can say that it is intended in the course of the debate next week to deal with the various possibilities, including the one mentioned by the Deputy.