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Dáil Éireann debate -
Thursday, 1 Nov 1990

Vol. 402 No. 4

European Economic and Monetary Union and European Political Union: Statements.

The first European Council under the Italian Presidency met in Rome on 27 and 28 October. I attended the meeting together with the Minister for Foreign Affairs, Deputy Gerard Collins. A copy of the Presidency's Conclusions has been placed in the Oireachtas Library. Today I want to report on the outcome of the European Council and at the same time to address the related issues that will arise in the intergovernmental conference which will open in December on European Economic and Monetary Union and European Political Union, and at the Europeam Congress of National Parliaments which will meet in Rome at the end of November.

Our membership of the European Community and the need to discuss at national level the changes and developments which have taken place since we joined have provided this House with some of its most important debates. I hope the present one will be no exception. In the past, there has been a general recognition and acceptance of the value of EC membership for this country and a desire that we should make our own contribution to the process of integration of the European Community. It is understood also that the Community provides the fundamental political and economic framework within which, as members of Government or as parliamentarians, we will operate in the future and which affords us the opportunity of achieving the highest level of prosperity.

When we applied to join the European Community we did so in the knowledge that we would be required to develop new policies and to participate in new initiatives, some unfamiliar to us, as the Community itself grew and expanded. The benefits and the obligations of membership go hand in hand. The Treaty of Rome makes it clear that the members of the Community are embarked on a process that leads to an even closer union of the peoples of Europe.

The oil crises combined with the doubling of membership from six to 12 in the space of 12 years understandably slowed down the pace of integration but it could not delay it indefinitely. No doubt some of the member states felt frustrated that it has not always been possible to move forward at a quicker pace; they believed that the Community was at its most vulnerable when it was most divided; they saw the over-zealous defence of sovereignty and protection of national interests as the principal causes of the economic sclerosis which attacked the Community during the late seventies and early eighties.

At the same time, others argued that by consolidating what they had and by feeling their way cautiously with one hand firmly holding on to the past, they would somehow be in a better position to protect their national interests. It was only when the gravity of what was happening to the economies of the member states as a result of the collective failure of the Community to strengthen and develop common policies became clear that a new sense of urgency entered the political arena and set the Community on a new and accelerating course to fuller integration.

Not very long after the entry into force of the Single European Act in 1987, the Community is once again considering how it can prepare itself to face the new realities — political, economic and social — of a changed and changing world. The European Community, which came into existence as a consequence of a terrible war in order to provide reconciliation and hope for only half of Europe's population, has now clearly become a political anchor for all of the people of Europe. Just as the original six members of the Community acted as a spur to other countries including Ireland so, we, the Community of Twelve must inspire and encourage the peoples of Central and Eastern Europe to consolidate their newly won democratic freedom, give it full and fruitful expression and build efficient market economies in order to offer a better life to all their citizens.

We can be justly proud of the progress that has been made since the ratification of the Single European Act, but we must ensure that the momentum which has been generated can be channelled into even more rapid and deeper integration.

The Internal Market is on schedule for completion by 1 January 1993. By the same date, substantial progress will have been made towards economic and monetary union with the possibility of a single European currency — something unimaginable just a few years ago — in circulation before the end of the decade. The legislation under the action programme to apply the Community Charter of the Fundamental Social Rights of Workers will be nearing completion. In other policy areas such as research and technological development and the environment substantial progress will also have been made. If we are to go further we must examine together what new objectives we need to set ourselves and, having reached agreement on them, make them part of the Treaty.

At the international level, the Community is facing new challenges. At the beginning of this year, during our Presidency, I moved to put our relationship with the United States on a sounder and more stable footing. It is astonishing to recall that one of the Community's most important relationships had not been formalised and lacked the support of a proper structure within which it was possible to meet at the highest political level and to discuss issues of common interest.

Nearer home, the rapid implementation of the Internal Market caused concern among the EFTA countries who felt that their interests would be threatened if they did not quickly enter into dialogue, as a group, with the Community. Those negotiations are difficult and progress has been slow but they are taking place at an intensive level, stimulated no doubt by the realization on the part of EFTA that not only is the Community moving rapidly towards the full achievement of its present objectives but is about to embark on a process which will set it new ones.

To the south, the countries of the Mediterranean, bound to the Community by traditional trade, cultural and historic links, are looking to us for help to sustain progress already made towards democracy and viable economic reform. Instability in this region of the world would have a direct impact on the Community and we must invest time and energy to address the economic, social and environmental problems of these countries and build a policy of good neighbourly relations with them.

It is, however, on the continent of Europe itself that the most dramatic developments have taken place. The farreaching changes in Central and Eastern Europe have helped to encourage the Governments of the member states to accelerate the political construction of Europe. For it was the Community, seen as a symbol of prosperity and freedom, where all member countries have an equal right to be heard and to have their say, which in part motivated millions of men and women to take to the streets and overthrow the oppressive regimes which had held them in servitude since the end of the war.

The unification of Germany on 3 October through free self-determination and by peaceful and democratic means is, and should be, a source of great satisfaction to the Community. It offers a remarkable example of the way in which the Community and its institutions can function and co-operate once there is political agreement and when clear objectives have been set. Ireland warmly welcomed German unification and can take pride in the very positive part we were able to play during our Presidency to facilitate the integration of the former German Democratic Republic into the Community.

What has emerged more forcefully since 1987 and the ratification of the Single European Act is the status of the Community as an area of stability in a turbulent world. The members of the Community have built up a solid network of links — economic, political and monetary — which bind them together in a unique fashion. It has made the Community strong and given it resources to help not only the poorer parts of its member states but others in the developing world. It has also enabled the creation of the necessary wealth and trading power to give it a strong and effective role in world affairs. We cannot stop there. We must press on and strengthen the Community. The pace of change is gathering momentum and the decisions which must be taken to reinforce the Community's coherence and develop its internal and external strength are important for all of us.

The two main fronts on which progress must be made are economic and monetary union and political union.

Deputies will recall that the European Council in Strasbourg in December 1989 agreed to convene an Intergovernmental Conference on Economic and Monetary Union and that the European Councils in Dublin in the first half of this year set the timetable for the conference and the ratification of its results. Further preparatory work has been done in the past months. The European Council last weekend considered the state of the preparations. Eleven member states were able to agree that the work done to date constitutes the basis for the Intergovernmental Conference which will open in Rome on 14 December next. These states also agreed on the principal elements which should guide the work of the conference and these are set out in the Presidency's conclusions. One member state — the United Kingdom — was unable to go along with the majority approach; the conclusions contain their separate views.

For 11 member states there is now agreement on several key issues. First, we agreed on the main aims of economic union including an open market system, price stability, growth, employment, sound financial and budgetary conditions, and greater economic and social cohesion. Second, for the final phase of monetary union we agreed on the creation of a new monetary institution, comprising member states central banks and a new central organ, exercising full responsibility for monetary policy. Third, we also agreed that with the final phase of EMU exchange rates will be irrevocably fixed. The Community will have a single currency — a strong and stable ECU — which will be the expression of its identity and unity. Fourth, it is agreed that the second phase of EMU will begin in January 1994 after certain conditions have been fulfilled. One of these conditions is real convergence between the economies of the member states. Fifth, at the start of the second phase the new monetary institution will be established with certain interim tasks, and, finally, there is a procedure for preparing the move to the third and final phase of EMU. Before this is done there must be a report to the European Council on the functioning of the second phase, and in particular the progress achieved on real convergence.

Ireland's general attitude towards economic and monetary union has been one of strong support. In giving that support, however, we give equal weight to the economic and monetary aspects of integration. This parallelism is of crucial importance for us. We are quite clear that it would not be in our national interest, or in the interest of the Community, if monetary union were to move at an accelerated pace, while the economic aspects of the design were left undeveloped. Our support is also on the basis that integral to economic and monetary union will be a commitment to the implementation of effective Community policies aimed at achieving economic and social cohesion.

Integration will bestow many benefits on the European Community by creating an environment conducive to growth and enhanced prosperity. At the same time, we have to consider the possibility that closer integration could lead to a faster development of the central and more affluent areas thus widening the gap between them and the poorer and more peripheral regions. I am concerned that this should not happen and we have argued this case strongly in the preparatory work on EMU. I believe that the agreements we secured last weekend as a basis for the work of the Intergovernmental Conference will protect and promote Ireland's interests — indeed the Community's overall interest — in this respect. Not only is economic and social cohesion agreed as one of the principal aims of EMU but there must be further progress towards convergence in each of the phases. In the detailed negotiations to come we will be seeking to ensure that the design of EMU takes these commitments fully into account. In this connection, we welcome the ideas put forward by the Commission on a possible widening of Structural Funds eligibility and these ideas offer a useful avenue for exploration. There is still a tendency, however, for many in the Community to consider that structural funding on its own will meet the objective of economic and social cohesion. We have consistently emphasised that the Community must also look to a more effective implementation of common policies — State aids and transport, for example — in bringing about this vital objective.

Another interesting pointer to the way in which a mutual support system could evolve in the context of EMU is the Commission's idea of a scheme of grants or loans to help member states overcome major economic problems. While the details of this suggestion remain to be fleshed out, it should prove to be a useful part of the new system required to ensure the capacity of less-developed regions to continue on the journey to economic and monetary union.

I would like in particular to emphasise the wide measure of agreement which exists on certain key matters of principle in both the economic and monetary domains. In the monetary area, there is almost unanimous agreement that there should be a common monetary policy under the control of an independent and federally-structured banking system which would have, as its overriding objective, the maintenance of price stability. A single currency is now also seen as an integral feature of the final stage of economic and monetary union. Our experience within the European Monetary System suggests that we are well able to cope with the rigours involved in this approach, subject to appropriate measures to improve cohesion. Indeed, the experiences gained by all members participating in the European Monetary System will be of great worth in ensuring that the degree of co-operation which is necessary to bring this about will be readily forthcoming.

To guarantee the success of economic and monetary union, correct economic policies will have to be implemented in tandem with monetary policy geared to price stability. The framework for ensuring that is already in place with the agreement reached by Finance Ministers during our Presidency on mutual surveillance of economic policies. Moreover, all member states are agreed that budgetary discipline is a key to the success of this process. They are also agreed that certain broad principles, designed to bring this discipline about, should be incorporated in the amended Treaty.

Given the degree of institutional change contemplated by the moves towards integration, it will be necessary to consider the issue of democratic control in some detail. There are important issues here relating to the respective balances which should exist between the various institutions. The role of the European Parliament, in particular, will require special attention. The Conference on Political Union will, among other matters, be examining these issues and it is to that conference that I now turn my remarks.

The resolve of the member states to press ahead with the further integration of the Community was evidenced by the decision at the European Council in Dublin on 25 and 26 June to convene a second Intergovernmental Conference on Political Union and to draw up the appropriate Treaty changes. Since then Foreign Ministers have been preparing the work of the conference and the Commission have given their formal opinion on the proposal. We had a full debate on this issue at last weekend's European Council. Eleven member states were able to agree on the broad lines of their approach to the Intergovernmental Conference which will open on 14 December next. The agreement amongst these 11 and the UK's position of reserve, are contained in the Presidency's Conclusions. Understandably, given that work did not commence until the spring of this year, preparations for the IGC on political union are not as far advanced as those on EMU. Foreign Ministers have been asked to continue their preparatory work up to mid-December under four broad headings: the overall objective and scope of political union; the democratic legitimacy of the union; the efficiency and effectiveness of the Community and its institutions; and the unity and coherence of the Community's international action.

Our approach to the preparatory work in these four areas is shaped by a number of guiding principles. Firstly, it has been a basic tenet of our policy towards the European Community that the development of political integration should be based on a growing community of interests in the economic and social field. Progress in the latter area, which from the beginning the Treaty of Rome saw as the means of eliminating the barriers dividing Europe, will shape the pace of developments in the former.

Secondly, the Community has proved its political role as a unifying force in Europe, based on its democratic values, success in improving the living and working standards of its peoples, its commitment to international peace and prosperity and its openness to the rest of Europe and the wider world. Nothing in the current exercise should diminish the constructive and flexible character of this role.

Thirdly, the two IGCs should mark a significant and coherent advance in the internal efficacy and deepening of the Community and the ability of the Community and its member states to work more closely and constructively with other countries of Europe and internationally.

Fourthly, the development of the Treaty to cover new areas of policy must proceed on the basis of the existing obligation of the Community and the member states under the Treaty, to strengthen the Community's economic and social cohesion and, in particular, to reduce regional disparities and the problems of the least favoured regions. With this goal in mind, it would be unreal to consider extending the scope of Treaty competences without addressing the means, financial and otherwise, required to meet the new objectives and to implement new common policies.

Two other issues can usefully be examined in the context of the scope of political union. They are subsidiarity and the concept of Community citizenship. Subsidiarity can be defined as the notion that the Community will only act to carry out tasks which can be undertaken more effectively by the member states acting in common than separately. The question is an important one which is related both to the transfer of competence to the Community and to the exercise of competences which already exist. Several of our partners wish to see the principle of subsidiarity anchored in the Treaty. The question is how do we go about this? For example, do we seek to define what should be exclusively the competence of the union, and those which should be left to national administrations, or should be, on the other hand, list those which cannot be ceded to the Community? Again, should we suggest areas which can evolve over time from the competence of member states to the Community?

I would argue that in considering this issue we should be clear, firstly, about the legal implications of any definition and, secondly, that subsidiarity would not be used to limit the development of the Community. This will require political agreement between the member states on the nature of the control of subsidiarity. Should this be of a legal nature with the involvement of the Court of Justice or a new Constitutional court as has been suggested? There are good arguments in favour of a general reference in the Treaty with control being exercised at political level. At a stage where the Community is in the process of evolving towards a fuller union, it would be more sensible perhaps to allow the designation of what should be the competence of the union and of the member states to be made at political level.

As the Community evolves and develops it is only proper that greater consideration be given to the rights which the citizens of the Community should enjoy. As part of the programme to establish the Internal Market, decisions are being taken to allow people to move more freely between the member states, to take up residence and to obtain employment. Attempts are also being made to reduce the bureaucratic barriers which confront the citizens of one member state when they move to another for employment or recreation. It is vitally important that the interests of the people of Europe should not be ignored by over-concentrating on economic and monetary issues or when striving to improve the efficiency and effectiveness of the institutions of the Community.

I welcome, therefore, the proposal to see included in an amended Treaty the question of citizens' rights. It is possible to imagine a legal definition of Community citizenship which would be made up of a series of rights, freedoms and obligations. Those would, of course, flow from the competences conferred on the Community. Basic special rights might cover the right of Community citizens to full freedom of movement, the freedom to choose one's place of residence and the right to political participation at the place of residence.

Additional rights would result from new policies. The extension to citizens of other member states of the right to vote in local and national elections in their country of residence and the establishment of a common procedure for elections to the European Parliament are areas which could also be examined. Ireland has already an advanced profile in relation to the right to vote in elections by nationals from other member states.

Other ideas have been put forward to help establish the concept of Community citizenship. One is to create a Community Ombudsman who would help to safeguard the rights of Community citizens in areas where legal redress through the court might be difficult or simply not available. A second idea, which can draw on experience from the Gulf crisis, is that Community citizens, irrespective of the member state of which they are nationals, should have the right, when outside the Community, to avail of the protection of the diplomatic missions of any member state. Ireland would be willing to study positively both these ideas.

In general, we should support an evolution of the concept of Community citizenship but ensure that from the outset a framework is established which will allow for practical measures to be adopted. It will be important to take into account rights already provided for in Community legislation and give a new impulse for others in the domain of a people's Europe.

At a time in the history of the European continent when barriers whether physical or ideological, are disappearing we must find ways of demonstrating to our citizens that they belong to a single geographical and cultural entity. By quickening the pace at which we remove internal frontiers and consolidating the concept of Community citizenship, we will be making significant progress.

Just as, in 1985, the intergovernmental conference from which came the Single European Act agreed to broaden the scope of the Treaty by bringing in new areas of competence, so too the forthcoming Intergovernmental Conference on Political Union will examine ways of broadening the scope of the Community by giving it new competences. This can be examined under three headings: first, areas which are covered by existing Treaty articles such as those relating to certain aspects of social policy, environment, research and technology and vocational training where decisions are currently taken by unanimity; second, areas which are not specifically mentioned in the Treaty such as health, civil defence, culture, education, consumer protection, energy policy, telecommunications and development co-operation; and third, areas dealt with at intergovernmental level outside the Treaty framework such as immigration, drugs, police and judicial co-operation could be codified in the Treaty establishing political union. An issue for consideration in this context is whether the decision making procedure applicable in these areas would be the classic Community procedure or, drawing on the experience of the procedure for European Political Co-operation under Title III of the Single European Act, an altogether special arrangement.

The implications for Ireland of any proposed changes under any of these three headings must of course be examined carefully. We would need to measure the advantages and disadvantages in any change to the voting procedure, especially were there to be a move away from unanimity or where areas of a particularly sensitive nature, presently dealt with at intergovernmental level, were to be brought within the Treaty framework. However, we cannot lose sight of the very real implications for this whole exercise which would result from a cautious or indeed negative attitude on the part of member states to a broadening of the scope of the Treaty. On the other hand, if all the areas I outlined earlier were to be included, we might run the risk of overburdening the institutions of the Community, slowing down the decision making process and allowing the Community to develop in an unbalanced manner.

The recommendations of the NESC report on Ireland in the European Community are relevant in this regard and Deputies will recall the argument put forward in that report that an advanced economic and monetary union with the Community involved in a wide range of policy functions would benefit the Community as a whole as well as the less developed regions. Furthermore, such involvement is necessary to achieve genuine integration of the Community.

It is not yet possible to say how much the scope of the Treaty will be broadened in the course of the current exercise. However, if we are to attain a level of European integration envisaged in the NESC report which can include appropriate mechanisms for genuine regional coherence and convergence, we should favour a wide rather than a narrower transfer of competence. Amendments to the Treaty should be framed in such a way as to further this objective and not to hinder it.

Concern has been expressed by the European Parliament and by a number of member states that unless the democratic legitimacy of the Community is strengthened as part of the present Treaty reform process the basic principles of democratic accountability could be undermined. At the same time national parliaments have expressed disquiet at the gradual erosion of their own powers following the adoption of the Single European Act.

The European Parliament believes that a significant increase in its powers is necessary as a result of the moves towards greater political union. Among questions posed here are the right of Parliament to co-decision with the Council of Ministers within the legislative and constitutional area, and Parliament's involvement in the nomination of the President and members of the Commission.

In the Single European Act, Parliament was given significant new powers under the co-operation procedure and it has used these powers constructively. We are prepared to examine in a positive spirit all practical suggestions aimed at developing the role of the European Parliament in the legislative process of the Community.

It would certainly be difficult to consider changes of a far-reaching character to the Treaties without ensuring that the participation of Parliament is also considered. Not to do this could diminish the credibility of the Parliament in the eyes of the electorate. It must, however, be stressed that a serious concern for us will be to ensure that the efficiency of the decision making process is not impaired — indeed it must be improved — and that any additional powers accorded to Parliament should not result in delays in the processing of Community legislation. Furthermore changes arising from the intergovernmental conference in the role and functioning of the institutions should not alter the existing institutional balance.

As a directly elected body, the European Parliament has a special role to play in ensuring that the Community is grounded in the principles of democratic accountability, but other institutions also have a part to play in this respect. We should not lose sight of the fact that the European Council and the Council of Ministers are fully representative of the peoples of the Community. The representatives of the member states in these Councils are answerable to their own parliaments and through these to their peoples — as, for example, I am answering to you today for last weekend's European Council.

As the process of Community integration develops and with the prospect of further competences being transferred to the Union, concern has been expressed about the role of national parliaments. These concerns and the whole question of the role of the national parliaments in the future work of the Community will be debated at the proposed European Congress of National Parliaments and the European Parliament to be held in Rome from 27-30 November. The preparatory work for this congress began at a meeting in May of representatives of national parliaments and the European Parliament which took place in Cork and was followed by two further meetings in Brussels and Rome. The Oireachtas was represented by Members of the Joint Committee on the Secondary Legislation of the European Communities. I have no doubt that the congress will be an important opportunity for national parliaments to put forward their own views on how they would wish to be more closely involved in future Community activities. I look forward to the outcome of the congress which I am confident will inform the work of the intergovernmental conference.

The Intergovernmental Conference on Political Union will provide an opportunity to examine and improve the response of the Community and its institutions to the major policy developments since the ratification of the Single European Act. Any necessary changes in the light of the additional competences and policies which the Community will acquire under the present Treaty amendments can also be made. Here, too, changes in the role of the institutions should in no sense be allowed to disturb the balance between them.

The European Council has played a central role in the development of the Community over the past five years. During our Presidency I felt it necessary to call an exceptional meeting of the European Council to allow for joint consideration at the highest political level of the dramatic pace of events in Eastern Europe and especially the rapid progress towards German unity.

When I wrote to my fellow Heads of Government in February inviting them to Dublin, I stressed the importance I attached for the Twelve to bring their collective voice to bear on the issues arising, to consider the steps to be taken to develop the Community's own integration process and to examine the demands that were likely to be made on the community in the new European. It is this broad political role to which the European Council is particularly suited. It can give a general political direction or impulse, act as arbitrator and, on occasions, decision maker on areas affecting the future of the Community. During our Presidency I became increasingly convinced of these crucial functions which the European Council must exercise in the construction of Europe. In my view the Council should retain the flexibility which has helped it fulfil this role.

Bearing in mind the need that has been felt in recent years to hold more than the scheduled two meetings per year, we might support any proposal to increase the frequency of meetings of the European Council. As the need for greater unity and coherence of the Community's international action develops, the President of the European Council could become the interlocutor for the union at the highest level. We would be prepared to examine any proposals which might be made about the manner in which it carries out its tasks but our experience would suggest that the value of the European Council might be diminished were its nature and structure to be changed significantly.

There is also a general acceptance that in future the role of the General Affairs Council and EPC Ministerial Meeting should be unified. During our Presidency earlier this year we initiated the procedure whereby Ministers discussed the political as well as the economic aspects of issues without having to change the format of the meeting, as had been so often the case in the past. We found that in working in this manner we were able to improve significantly the co-ordination between the positions adopted in the economic sphere and those adopted in political co-operation. It seems to me sensible that this practice should be continued and formalised. The overall objective should be to ensure the most efficient and rational management of the work of the Community.

The role of the Commission, which is the guardian of the treaties, is central to the proper functioning of the Community. As the initiator of legislation, it must be endowed with the necessary authority and powers to ensure that the interests of all the member states are fully taken into account in the framing of legislation. It must also be given the necessary powers to implement decisions taken by the Council. Under the Single European Act new powers were conferred on the Commission and experience has shown that on balance these have worked well. We can, of course, look at any improvements which might improve the operation of these new procedures.

The number of Commissioners is an issue which from time to time has been considered by the member states, particularly during the negotiations on the Single European Act and on the accession of Spain and Portugal. It has been argued that a Commission with fewer members would ensure better co-ordination, would enable matters to be more thoroughly discussed and facilitate clear conclusions, constitute a genuine team and allow its members to have a better personal knowledge of each other, thus creating a better collegiate spirit, and establish portfolios of genuine content and equal weight.

I see no reason we could not indicate support — we did so in the past — for a reduction in the number of the Commissioners, provided there is no attempt by the larger member states to monopolize the more important portfolios and provided that there is one Commissioner from each member state.

The June European Council decided that the Intergovernmental Conference on Political Union should "define the necessary framework for transforming relations as a whole among the member states into a European Union vested with the necessary means of action". One of the areas to be considered in this context is the unity and coherence of the Community's international action — that is, how the policies of the Community vis-à-vis the outside world can be expressed more coherently and implemented more effectively. At its meeting on 28 April last, the European Council agreed that the Community would act as a political entity on the international scene. It is in this framework that the intergovernmental conference will examine proposals that the Community should adopt a common foreign and security policy.

It is clear that fundamental changes have taken place recently in Europe with the end of the Cold War. The situation in Central and Eastern Europe has changed with the diminution of the role of the Warsaw Pact and the restoration of democracy in most of these countries. The security picture of Europe as a whole has changed dramatically. These changes are continuing. At the same time negotiations between the alliances and between the super powers are bringing about reductions in military forces. The level of tension and threat in Europe continues to diminish and the alliances on both sides are facing fundamental questions about their role in this new situation. Security and defence doctrines based on what might be called East-West thinking are undergoing fundamental reassessment.

The United Nations is playing an increasingly important role in the current difficult international situation, and one which is closer to that envisaged for it in the Charter, of an international body with genuine responsibility for international peace and security. This is a development we welcome.

The CSCE process has played a vital role in the positive developments in Europe of which I spoke, in providing an overall framework within which movement towards a new concept of European security has been possible. We believe that it has the potential to contribute further and are in favour of building it up by providing it with institutions and giving it a role in areas such as conflict prevention and verifying military and security commitments, as well as providing a forum for disarmament negotiations among the 34 member states.

We are looking, therefore, at a situation in which the parameters of the debate on foreign policy and on security are very different from what they were four or five years ago. These are the parameters within which we, along with our partners, must look at our approach in the areas of foreign policy and security policy.

At the Rome Council 11 member states, including Ireland, were able to agree that these major developments on our continent required us to get the objective of a common foreign and security policy in order to strengthen the identity of the Community and the coherence of its action on the international scene. We agreed that this action will be open to the world and will give a significant role to development policy. We also agreed that the Community will strengthen its links with other European countries and that for this purpose closer co-operation structures will be sought.

The Presidency's Conclusions make it clear that while there is agreement on the overall objectives the content and detailed rules of the role of the Community in relation to a common foreign and security policy have yet to be defined. Furthermore they are to be defined gradually and without prejudice to the obligations arising out of the present security arrangements to which member states are party.

Here I should say that the position I have put forward already on this issue, and which reflects the position of successive Irish Governments, is that if the Community were at some stage to embark on arrangements for its own security and with its own security concept, then Ireland as a fully committed member state would be willing to consider participation. The creation of the Internal Market and of an economic and monetary union, the development of the concept of Community citizenship, the increase in the scope and responsibilities of the Community will create a powerful bond between the member states and solidarity between their peoples. It will give rise to an area, a territorial unit, with the closest political, economic and social ties. The question, therefore, is whether there is now emerging a common security interest specific to the Twelve and whether, in accordance with the commitments of successive Governments to which I have just referred, this country would be willing to work with partners towards a structure which would give that interest expression.

As yet member states have not put forward specific proposals or defined what is meant by security or what the limits of the concept might be. In so far as the concept has been talked about it has given rise to a fairly wide range of differing views. Some member states suggest — and I agree with them — that there is a distinction between the concepts of security and defence. The Single Act refers to the political and economic aspects of security. There are two dimensions. There are others apart from the military aspect. For instance, security can cover the defence of the Community and its citizens from international terrorism.

It could have a disarmament dimension. The Community could be seen to be providing its own security by taking a positive attitude and playing an active united role on issues of international disarmament. There are other aspects. One thing is clear to me. A common security policy in the Community is not likely to include the defence or military aspects for some time to come. Why do I say that? I say so because a number of the member states who are most concerned about these matters are adamant that European defence and military matters are for NATO and NATO alone. Others see the WEU as the right vehicle for these matters.

We are now at a stage of pre-negotiation. The negotiating phase will begin with the IGC. Among the questions it will discuss will be what areas a common foreign and security policy could cover, how such a policy could be introduced in terms of the Treaties, in the light of existing obligations of other member states, how decisions should be taken and what institutional and structural changes should be made to enable a new policy to be implemented coherently and effectively. We will be putting our views forward in these negotiations and we expect our partners will be doing likewise.

We will look very carefully at the role of the European Council in this area. We will wish to ensure that the new Treaty to be negotiated sets out clearly the limits of partners' commitments in this sensitive field and that these are not decided in any ad hoc manner. In any case, we would find it difficult to envisage that decision making at any level in an area such as this, being brought for the first time within the competence of Community machinery, should be otherwise than by consensus.

I have thought it right to describe to the Dáil the major issues likely to arise at the two intergovernmental conferences. In some cases — such as economic and monetary union — the issues are now relatively clear and I have given you the main lines of Ireland's position as we enter into the negotiations. Others — such as a common foreign and security policy — are less well defined and will require a great deal more preparation. In these cases I have sought to bring out the key points at this stage and to outline our overall approval. The negotiations opening in December will be crucial for the Community, setting its course for the foreseeable future. They will be crucial also for Ireland whose destiny is now irrevocably linked to that of its partners in the process of European integration.

The discussions on economic and monetary union and on political union naturally occupied a great deal of the attention of Heads of State and Government at the Rome meeting, but we dealt also with a range of other matters of great current importance in international relations.

The European Council heard a preliminary report from the Commission following its talks with the Soviet Government — pursuant to its mandate from the European Council in Dublin in June — to prepare proposals for Community assistance. The Council expressed the willingness of the Community to contribute to the success of the reforms recently adopted by the Soviet Government and asked the Commission to submit its proposals before the next meeting of the European Council in December. If, in the meantime, emergency action is required the Council will take whatever decisions are necessary on the basis of proposals from the Commission. The European Council also asked the Commission to put forward proposals for a major commercial, scientific and technical co-operation agreement with the Soviet Union.

In relation to Eastern Europe, the European Council took stock of the progress made in the programmes of financial and technical assistance and in the Community's discussions on association agreements with the countries of the region. Noting that these countries are experiencing additional adjustment difficulties because of the international situation, the European Council agreed that the Community has a duty to help consolidate and develop the reform process notably by playing its part in the stabilisation of their financial situation. Particular attention is paid to the situations in Yugoslavia and Hungary.

May I interrupt the Taoiseach to anticipate the agreement of the House that the extra minute or two would be made available to him to complete his remarks? Is that agreed? Agreed.

I will not be much longer, a Leas-Cheann Comhairle.

Heads of State and Government also considered developments in the current round of GATT negotiations. We confirmed the Community's commitment to making a full contribution to the round in the interest of strengthening free trade and fostering worldwide prosperity. In this connection the European Council called on the Community's international negotiating partners to make efforts towards a successful conclusion. In regard to the Community's offer on agriculture, the European Council requested the Council of Ministers to adopt an agreement enabling the offer to be submitted. So far as Ireland is concerned, member states are now clear at the highest level about our position and I am confident that our interest will be fully taken into account in the forthcoming discussions in the Agriculture Council.

Under the foreign policy heading, the Heads of State and Government condemned the Iraqi practice of holding foreign nationals as hostages and affirmed their determination not to enter into the Iraqi logic of dividing the international community on this issue, not to send official representatives to negotiate with Iraq on it and to discourage others from doing so. They suggest their concern at the persistent Iraqi violation of international legality, in particular the prolonged and destructive occupation of Kuwait. The European Council also set out the Twelve's position of principle on the Arab-Israeli conflict in the Middle East and the situation in the Lebanon. The Council welcomed the normalisation of relations between the Community and its member states and the Islamic Republic of Iran.

On the eve of the Paris Summit on the CSCE, the European Council reaffirmed the essential role of that process and expressed the determination of the Community and its member states to subscribe to all the commitments in the document to be signed by them at the summit. The Dáil will see that the European Council in Rome dealt with questions of great significance for the future of the Community and with important issues in the current international situation. Decisions were taken and guidelines given which represent significant progress in the affairs of the Community on a basis that ensures the protection and advancement of Irish areas and interest. I would like to pay tribute to the courtesy and efficiency with which the Council was run by Prime Minister Andreotti and the Italian Presidency aided by the Council Secretariat and the Commission. A number of the themes we addressed will be taken up when Heads of State and Government meet in Rome in December. I will report again at that stage to the House on progress achieved and on Ireland's contribution.

I hope I have been of help to the House in offering these views and comments. I will genuinely welcome contributions by Deputies on these matters. In some areas I have given a fairly clear indication of policy. In others I have just outlined the issues that re-arise and, particularly on those issues, I will warmly welcome the views of the parties in the House.

Also may I wish the Oireachtas Committee on European Affairs, chaired by Deputy Peter Barry, success in the work they have to do on behalf of this Parliament in this area and at their forthcoming conference.

When I wrote to the Taoiseach and the leaders of other parties suggesting that we have a debate in this House on the future of Europe, this was agreed to by the Taoiseach and other members to whom I am grateful. However, it is not taking the form or duration I would have wished. Rather it has become more a report by the Taoiseach on the Heads of State meeting in Rome last weekend, which is useful and takes place twice annually here.

We are now at a crucial point in the development of the European Community. It is essential that this House and the committee of which I am chairman be given an opportunity to debate in detail what route the Government think we should be taking and what proposal we should be advancing for the developed European Community both from the monetary and political points of view in the future. The decisions that will be taken as a result of the intergovernmental conference — whose meetings will probably stretch into next year — will affect this country for perhaps a century to come, or even longer. Therefore, we would want an opportunity to hear the Government's views.

The Taoiseach said a few seconds ago that he has put forward some firm views — I dispute that — and indicated a number of problems that might arise. I think it quite fair for this House to ask the Government to put before it a White Paper underlining what they see as a solution to the problems this country will face in bringing about an integrated Europe in the future. Last weekend's meeting of European Heads of Government in Rome underlines once again the need for a comprehensive reappraisal of our foreign policy and a clear statement of our priorities and polices for the next phase of a developed EC. That can come only from the Government. They are the only people who have the machinery and the staff to undertake a detailed analysis and present to this House the various options under different headings and their preferred option as far as the future of European development is concerned.

We have to have that debate on the basis of a paper before the Intergovernmental Conference starts in the middle of December. I presume the Government intend to put a paper before that conference and will not just be reacting to papers that are now being prepared in other capitals and will be the basis of a discussion at those conferences. The Government have an obligation to prepare such paper and we have the right, and I would say the obligation, to debate it in this House.

Rapid and profound changes are taking place both within the EC and in the broader European framework. We need to clarify what greater political unity will mean and we must do so in the context of a whole range of changing circumstances and relationships. The EC is facing two very different and major challenges. The first is to draw up the blueprint for European monetary union and to refashion European institutions to facilitate greater political unity. The second is to work out a strategy for the wider association of European countries. In this regard the Community would have to assess critically the best method of helping the Central European and Eastern European countries to achieve the start of a stable, prosperous, liberal-democratic state while also recognising the changing needs of the 12 member states within the EC.

German unification will have a dramatic effect on the future policies of the EC. The Taoiseach may recall that I have been pointing out here for the last 12 months that the unification of Germany was in effect an enlargement of the Community because it brought in what was in essence a 13th member state, a state the size of Ireland and Denmark put together. The Taoiseach dismissed my concern in that regard and said there was no country in Europe better equipped to do this and it would have absolutely no effect, and he had been given this assurance by Chancellor Kohl on Ireland and on the Community as a whole. I am sorry to have to say that I think my assessment of that position earlier this year was more correct than the Taoiseach's. It is quite obvious that the unification of Germany is going to have quite a serious effect on the EC and we should have been preparing for that and not dismissing it as something that would not have the dramatic impact I thought it would have — and is having — on the Community.

We in Ireland must be clear about our role in the process of changing developments and we must be clear about the demands these changes will have on our society and our political institutions. Many political commentators have written about the scale of the challenge facing the emerging democratic states in Central and Eastern Europe. Although the countries of the EC face a very different challenge, the new relationships and circumstances developing within the Community have a potential impact that I believe is equally profound. We will have to adapt to a different set of political relationships both within the EC and in the broader European framework. The fact that we have a centralised Government system and very poorly developed local and regional structures will have negative consequences for the democratic participation and for the notion of democratic accountability. In many ways we are very badly equipped for the closer integration of the EC.

In his speech this morning the Taoiseach referred at some length to the principle of subsidiarity. It is a principle to which I subscribe, but the most efficient form of democratic government is that the centre would do only the tasks the local communities are unable to undertake themselves. We have to recognise that, even though we support the principle of subsidiarity in Europe, we do not support the practice of subsidiarity in Ireland. One of the problems we have to address here is that we have to break this country down into regions that genuinely have power to do things for themselves. That will strengthen the democratic process much more, because of all the countries of Europe we have probably the most centralised system of government.

The evolution of a Community that is more economically and politically unified will present a real challenge to our political institutions as they exist. As I said, Oireachtas Éireann is probably the most under-developed legislative assembly in the whole of the EC. We lack an Oireachtas committee on foreign affairs — to which I have been referring, and the normal response to that is to ask why we did not do it when we were in Government. Since the Single European Act came into force in 1987 we have had to play a much greater role in political co-operation in the EC. The necessity for the accountability of that role back here at home has been very much more stark. For that reason a foreign affairs committee should be established here as quickly as possible because the lack of such a committee compounds the kind of over-centralisation in Government powers I talked about earlier.

A committee on foreign affairs consisting of representatives of all parties in both Houses of the Oireachtas could play a crucial and very constructive role in identifying and assessing the political priorities in a rapidly changing international situation. Let me say, not in a carping fashion — though I suppose it is in a carping fashion — that I have written to the Taoiseach on three occasions in the last 12 months suggesting a formula for the establishment of an Oireachtas committee on foreign affairs. I am sorry to have to say I did not get a reply. He might look into that. I suggested a formula. He may remember we had a debate here in this House last March on a committee of foreign affairs which was defeated by the Government votes. At the end of that debate I suggested to the Minister for Foreign Affairs that those interested spokespersons from the various parties could sit down in a non-contentious way and draw up terms of reference. That was not the only thing, of course. The Government's principal worry was that we draw up terms of reference that would be acceptable to the Government and which could from the basis for a committee on foreign affairs. I followed up that letter by writing to the Taoiseach in the following month — I cannot remember the exact date — and I have sent two reminders since then, so he might look into this.

I apologise for that, but on this aspect of European affairs I am always puzzled that the committee the Deputy chairs cannot be seen as the necessary committee vehicle.

That is another point and I will be glad to discuss that with the Taoiseach, but the terms of reference of the Joint Committee on Secondary Legislation of the European Communities need to be changed to allow us to do that. They would not allow us to discuss foreign policy, for instance, and not necessarily forthcoming events. Of course, I cannot speak for other parties but if that was sufficiently broadened I would be happy to take that on. I would put forward my proposals in that regard to the Taoiseach and I hope he will examine them fairly sympathetically. My colleagues on the committee and I will have to discuss that first.

Some work is being done on the future role of the 12 national parliaments and their relationship with the European Parliament. With more power concentrated in European institutions it is important that national and regional institutions maintain some power and decision-making ability.

I have mentioned democratic accountability. Among the greatest challenges facing member states will be to preserve and maintain this notion in a more integrated Community. Let me say in that regard that, if the role of the committee which I chair can be expanded, I do not think it is necessarily the committee's job to put forward views. Of course it is their job to put forward their set of views, but the Government must also have a role in this. This is a committee that is not properly funded or staffed. If we want European and foreign affairs debated in a serious manner on that committee we must have the staff and funding.

The Assises which the Taoiseach referred to earlier, which come from a suggestion by President Mitterrand, in regard to the protection of the national parliaments is a very important part of the future development of Europe. The national parliament's role, and importance, must be underlined and accepted. President Mitterrand suggested that a debate should be undertaken by all the parliaments in Europe and the European Parliament, and that the Assises would be made up of special committees of European affairs of the 12 national parliaments. The 12 national parliaments have been consulting with each other, and with the institutional committee of the European Parliament, and these discussions centre around the organisation of what is called the future relations of the double legitimacy of the European Parliament on the one hand and the national parliaments on the other hand. Our Joint Committee on the Secondary Legislation of the European Communities are participating in this work but are seriously underfunded. Much more research needs to be done and we need to have the proper staff and the proper funding even to undertake the work which must be done between now and the next meeting at the end of November. We need extra staff and funding to be able to properly prepare and represent this Parliament because that is what we will be representing. We will not just be representing the committee but this Parliament at those Assises. We, therefore, need to be properly funded.

The role of the national parliaments, and their relationship with the European Parliament is crucial for future development. We must work out clearly what the relationship should be and set out our policy in this regard. The Government have so far given no indication of their interest or concern in this area. As I indicated earlier, I am glad to get an indication from the Taoiseach that he will look into the matter.

I believe that their preparations for the meeting of the intergovernmental conference in Rome must contain a comprehensive policy statement on the role of national parliaments and their relationship with the European Parliament as well as on the whole area of political union. This should all be written down on paper so that we can discuss it either here or in the committee.

The centrepiece of Irish foreign policy over the years has been our neutrality. The substance of that policy is that while we whole-heartedly belong to the group of Western Liberal Democratic States, we believe that military conflict is an unacceptable way to solve international disputes or disagreements. Both the Minister for Foreign Affairs and the Taoiseach have mentioned the question of participation in a security arrangement in a more integrated European Community.

Regrettably, neither the Minister or the Taoiseach have spelt out exactly what this security arrangement might entail or initiated a national debate on foreign policy in general and on neutrality in particular. A national debate on this topic is vital if our foreign policy is to continue to have a broad-based support. A policy best serves a society if it is widely understood and supported. The place to start that debate is here, but there are other fora also.

The Government have had numerous opportunities to discuss neutrality and the implications for Ireland of a common security policy. They have not done so. As usual, they have walked away from a debate they thought might be difficult or contentious. I want to draw attention to comments by the Taoiseach which I think should be enlarged upon. It is because Fianna Fáil have failed to change and develop in the last ten years that that party have held back the political development of our people and of our political institutions. The Taoiseach today referred to the policy of successive Irish Governments but it has not been the policy of all political parties at all times. It is the policy of the Fianna Fáil Party when they are in Government but it is not the policy of the Fianna Fáil Party when they are in Opposition. It is that kind of inconsistency that leads to confusion in people's minds as to what neutrality means and what security means.

Let me intervene very briefly, and in the best good manners, I hope. This debate would be much more helpful if the Deputy would give me his own views on these matters. I know it is a function of Opposition to criticise Government, but I would genuinely like to hear the Deputy giving me his views on the current situation.

I am sure the Taoiseach would and I would certainly be glad to do that, but we still do not know what the Government's view is.

It was in my speech.

No, it was not. There were two comments on the security area that need explanation from the Government. The first is the reference that "at the Rome Council, 11 member states" and so on. This is something members of the Community should pay attention to. There were about three references in the Taoiseach's speech this morning to 11 member states. I know, of course, that the United Kindgdom is the odd man out there. I am not sure what the solution to it is, but we cannot advance European integration unless there is a change of attitude in Britain about Europe. That is a matter that should not alone be discussed by the 11 member states, but by the Twelve also.

An integrated Europe without the UK would not be real. Therefore, we must find a way to have a more constructive role in the European Community for the United Kingdom. I had not appreciated, until I read what the Taoiseach said this morning, how many decisions they step-aside from and leave to the other 11 member states. A two-speed group is not something that anybody wants to see developing. The problem must be assessed.

The Taoiseach said:

At the Rome Council 11 member states, including Ireland, were able to agree that these major developments on our continent required us to set the objective of a common foreign and security policy in order to strengthen the identity of the Community and the coherence of its action on the international scene. We agreed that this action will be open to the world and will give a significant role to development policy.

Frankly I do not know what that means. I cannot understand it.

That is the conclusion.

It is not clear to me. I hope it is clear to the other 11 member states. I hope the Minister, who, I presume, will speak later in the day, will spell that out for us.

If Deputy Barry will forgive me, unfortunately I must leave, but I will read what the Deputy says.

I hope the Taoiseach has the time.

The Taoiseach also said: "A common security policy in the Community is not likely to include the defence or military aspects for some time to come". That is an ominous phrase, something I am anxious to draw attention to. It should be debated in the House at some future time because I do not think it is possible to put a foot on this road of a common security and defence policy without realising where that road may lead to. In the hypothetical situation of, say, Turkey attacking Greece or Norway attacking Denmark, would we be obliged to send troops to defend Greece or Denmark? The use of the phrase, "for some time to come", implies that that time will come and we should be quite clear at this stage of where it may lead. I have views on this. When the Government explain what their views are I will have something to say about that, but at the moment we cannot leave it as vague as the Taoiseach left it this morning. We must have a mature, an informed and, above all, a balanced debate on the question of a common European security policy and the effects of such a policy on Irish neutrality.

I suggested previously, and I hope someone listened to me, that when you and I, a Leas-Cheann Comhairle, were members of the New Ireland Forum we were successful in changing public attitudes here about the North. It was the most successful undertaking in that regard with national opinion sitting down and producing a document, which has been a reference point since, on the views on Northern Ireland. I hope we will have something similar, and that we can discuss neutrality and a common defence policy in Europe where people other than politicians could contribute to the debate. A process similar to the New Ireland Forum might best serve the interests of democracy and accountability but regrettably the Government have resolutely refused to initiate this or any similar process. They have continually failed to spell out what they consider a common European security policy would entail. They must do so before the intergovernmental conference in December.

The Government continue to display a lack of any sense of urgency about the forthcoming intergovernmental conference and do not seem to realise that decisions will be taken which will affect our economic, political and social development into the next century. Our success, perhaps even our survival, will depend on how we cope with the changing developments in the European Community. We must not go to the intergovernmental conference merely to react to the proposals of others. Other governments and countries are preparing cases which will be the basis for discussion and we must go to the conference with a clear set of proposals and priorities of our own so that we are not just tagging along.

The question of the role of the European institutions also demands reflection and analysis by the Government and the Oireachtas and while the move towards the single market continues, questions arise as to the shape of the political institutions necessary to facilitate European integration, for instance, what role the Council of Ministers will play. If the decision making process is dominated by the Council of Ministers, the role of the Opposition parties in the member states will be weakened and the possibility of Opposition parties contributing to policy making will be effectively ended. The impact on national policy will be devastating and in the end the notion of a European Community will come into disrepute.

The Taoiseach said that he is accounting to the House for what happened at the intergovernmental conference. Ministers go to the European Council meetings and take decisions there and they are only made accountable to this House when the Taoiseach reports back to the House or when we have infrequent debates on foreign and European affairs. When we originally joined the Community an undertaking was given that a six months review would be prepared and debated in the House. It is some years since we had such a debate. I understand the pressures on Departments, particularly in times of cutbacks to produce such debates and I understand the pressures on Ministers especially nowadays when they spend so much of their time away on European business. However, other ways must be found to deal with the issue. The Minister for Foreign Affairs as our representative on the Council of Ministers must be accountable to the House.

I said before that I thought most Members would be willing to come back one Friday or Monday a month to debate European affairs but it would have to be on the basis of a paper prepared and distributed beforehand and not on a script issued that morning by the Minister. In that way adequate time could be given particularly to the Committee on Secondary Legislation to discuss the paper. As a result a more constructive fact finding debate could take place in the House rather than a kind of political confrontational debate. It is not a Fine Gael or Fianna Fáil position, even though we might have different opinions on the road forward, but an Irish position that needs to be put clearly to Europe.

The case has been made for expanding the role of the European Parliament. The Taoiseach appeared to be against that this morning. The Parliament is the only directly elected European institution and therefore it fulfils the prerequisite of democratic accountability as well as maintaining a direct link with the people. How can the role of the Parliament be expanded and strengthened? The Taoiseach appears to have reservations about expanding the role of the Parliament, and perhaps he will have an opportunity later to tell us why and let us know what role the Parliament should play. We are trying to get the Government's views on many areas so that we can debate them.

The role of the Commission must also be examined. What should be the role of the Commission in a more integrated and perhaps eventually enlarged Community? How do we tackle what the President of the Commission has called the democratic deficit at the heart of Europe? The Taoiseach has given an indication of the Government's thinking here and I agree with it. He said there is a strong case to be made for a smaller Commission. I agree with that — and when I am in agreement with him I will say so — however, that is, provided it is not at the expense of the rotation of smaller member state's seats in that Commission. Every country should be represented, but perhaps the two seats for some countries should be done away with. That is one point he put forward which is an Irish viewpoint. Perhaps there are other points I would agree with if only they were put forward.

It is fair to say that in the past the Commission played a very strong role in the development of the Community. It set the agenda and forced the pace of change and reform. As the Community becomes more integrated politically. There is a danger that the Commission will become a source of power that dominates the Community institutions. There are indications that that is happening but I must balance that remark by saying that the Commission has been an extremely good friend to this country over the 18 years we have been members.

There is a further difficulty with the role of the Commission as the Community expands. If it becomes too large and unwieldy it could become an ineffective and inefficient decision making body. The task for the member states is to identify a role for the institutions of the Community that balances decision making power with responsibility and accountability. I recognise that is far easier said than done but the Government must be very clear about our position in that regard.

The future of a unified Germany lies within the European Community, but how will the Community deal with applications for membership from Poland, Hungary, Czechoslovakia and, perhaps, other emerging democracies in Central and Eastern Europe? The question of whether the European Community should aim for deeper or broader development is the issue here. I come down in favour of the former.

Those who favour deeper development maintain that a strong unified European Community can act as a stabilising factor in the future of Europe. This argument further maintains that the Community will have to deal with quite a large degree of change in the next few years and that it would be unwise for it to expand too soon. The impact of German unification is only beginning to be assessed and it will undoubtedly result in policy changes within the European Community.

The argument for a broader European Community suggests that being members or even associated members of the European Community will help the Central and Eastern European countries to make the transition from centralised economies to social market economies in the liberal democratic model. I am inclined to favour the deeper rather than the broader development at this time. A too rapid expansion could destablilise the Community and exacerbate existing difficulties and challenges. In the short term, I do not think that Central and Eastern European countries would benefit from membership and association. The pressure that membership would exert on their economic and political systems might prove to be detrimental to their political development. The emerging democracies of Central and Eastern Europe need time to develop their own system and they also need time to identify their own political priorities and aspirations. If the European Community is to progress and develop, the effectiveness of its decision making process must be strengthened.

Last weekend's summit in Rome was inconclusive and a number of urgent issues, including the GATT talks, remain to be resolved. The Community seems unsure of its stance and its strategy with regard to the talks. The completion of the Uruguay Round of GATT talks is crucial to agriculture and to all aspects of world trade. It is essential that the Community adopt a clear negotiating position and that talks proceed on that basis. The future success of the Community may depend on the capacity of the Council of Ministers to make decisions and carry them through.

One of the central issues in a more integrated and unified European Community will be the question of security arrangements. For many of our European colleagues the two are interlinked. Their notion of a common security policy suggests that if any one member state is attacked then all are attacked. The response of the Community would be to mobilise in defence of the member attacked.

The Taoiseach was very clear at the weekend about our commitment to the process of European Political Unity. However, he was less than clear about what that means. Does he agree that participation in an integrated European Community requires an undertaking to defend that Community? For us in Ireland it may be difficult to differentiate between a security role and a defence role. However, this is an area that must be discussed and the Taoiseach must make a clear statement on this issue. Will the Western European Union be the centre piece of a European defence strategy? There are a number of key questions which the Community must face with regard to security arrangements.

What form will the NATO alliance take and what will the relationship of the European Community be to that alliance? All these issues have a bearing on our political future and we must be clear about our priorities and our policies. Otherwise we will find ourselves reacting to events rather than initiating debate. That is a point I have made twice and one I want to repeat. We cannot go into the intergovernmental conference in December and react to papers that have been submitted by other people. This country must produce its own paper on what it believes should be the direction of European integration, particularly in the areas of monetary union, political union, security and defence. We must put forward our points of view on those issues. I hope the Government will produce such a paper and that we will have an opportunity of debating it here in the future.

I am firmly convinced that the Government are not approaching the forthcoming Intergovernmental Conference in Rome with the degree of seriousness and attention it demands. We cannot and must not go to this meeting unprepared and unsure of our political goals and strategies for the future. The Government must commit to paper their views on the future development of the European Community and our contribution to that process. It is not good enough for the Government to come into this House and give us generalisations and assurances. The construction of an integrated and politically unified European Community will take courage, determination and a great deal of imagination. I do not think this Government have demonstrated that they have these qualities. If they do not prove to have them our future as a people and as a political entity will be less secure and less sucessful.

I intervene in this debate as one of the Labour Party representatives on the Joint Committee on EC Legislation which has been presented with many documents dealing with the interegovernmental conference and the Rome Assises. I welcomed the opportunity of listening to the Taoiseach's introductory statement on what is a very important debate. I agree with the comments made by the previous speaker, Deputy Peter Barry, who is chairman of that committee, in calling for reviewed terms of reference for our committee. That committee is a structure which could not only develop our foreign policy but could also deal with other European matters, make an input into inter-governmental conferences and present the Government's position at these conferences.

I agree it is imperative that the Government publish their own views, particularly as they relate to political union, to which the Taoiseach referred in his speech, although not to a very great extent. It is imperative that the country and the Oireachtas know the Government's position. One way of doing that would be for the Government to publish a paper for discussion in the House, which would be circulated to the Joint Committee on EC Legislation for deliberation before 14 December. If we could have agreement on the broadening of our terms of reference, the committee of which we are members could play a useful role in preparing for the tremendous changes and challenges that confront us. Major changes will take place which will demand policy responses from each country, including Ireland.

We have to consider the question of German unification, the changes in the USSR, Central Europe and Eastern Europe, the EC and EFTA relationship, trade relations between the US, Japan and the Pacific Basin, the GATT negotiations, which are occupying all our thoughts just now, and of course our attitude towards Third World problems. We are confronted with the major crisis in the Gulf, to which the Taoiseach has referred. There is an on-going crisis in the Middle East, with an escalation of the Israeli-Palestinian problem. Oil prices are escalating and there is also a problem with the rise of fundamentalism. Within the European Community we are concerned with major decisions about 1992 and the implications for this small country on the periphery of Europe. We are also faced with the challenges that arise from the result of the Single European Act referendum. This of course leads to economic and monetary union and political union.

I will deal with the few items the Taoiseach has mentioned in the area of political union. The Taoiseach has put down his, and possibly the Government's view on this aspect. In his speech he dealt with the question of a disarmament dimension. In all our debates on membership of the Community and in the referenda which followed our accession to Europe and indeed the Single European Act, the Labour Party and other parties of the left conclusively and consistently stated that Ireland is a neutral nation. It is our view in the Labour Party that our neutrality is not for trading. It is important to realise that we are totally committed in our opposition to any major military bloc. We are opposed, without fear of contradiction, to membership of NATO. Other fora have been suggested in Europe to discuss the defence of the European community.

The Taoiseach mentioned that the Government would give careful consideration to this aspect and to the demands that might be made on us in the area of political union. It is essential that everybody in this country knows the Government's position in relation to a possible compromise in the area of our neutrality or our participation in Europe in areas outside of economic development. Membership of the Community was always confirmed to be membership of an economic power bloc. It had nothing to do with the defence of Europe, joining NATO or any other military pact.

We have a proud record as a small neutral nation within the United Nations. We have participated in their peace-keeping agenda and sent our troops to assist in peace-keeping in most of the conflict areas of the world. We feel it could be quite dangerous to move away from that position and to get caught up in any alliance that might be involved in the maintenance of security of Europe or in any other matter which has been referred to by the Taoiseach.

During the coming months, particularly December, we will see the launching of the two intergovernmental conferences which will deal with EMU and EPU. This country will be challenged to produce a clear, strategic response to the wide and controversial issues which have emerged. The work of the Inter-governmental Conference on European Political Union will be overshadowed by the Gulf crisis. We will be confronted by demands for new Community moves in the area of security and defence. This autumn will see the convening of the conference which was initially called by President Gorbachev to discuss the future of European security in the aftermath of the ending of the Cold War and the collapse of the Warsaw Pact. Ireland must approach this important conference with clear ideas about its preferred model for future European security and co-operation.

The intergovernmental conference and the CSCE procedures will lead to new political positions for all European nations, including Ireland. They will also lead to proposals for changes in Community treaties, to perhaps a second Single European Act and hence to another referendum which will probably take place here in 1992. This presents a challenge to all of us, particularly those of us on the left, to review and update our policies on economic, environmental and social issues and foreign and security matters. We are trying to define our attitudes in this matter and we suggest that the Government should state their policy quite clearly in this area.

Other points for consideration will be European monetary union and the economic and monetary policies of the Community. We want to make sure there is a proper balance in the debate as regards policy proposals and that everything is not weighted towards monetary objectives. As regard the structures of the EMU, the European Central Bank will have responsibility for issuing the currency, ECU.

What is the appropriate model for such an institution? How should its accountability be ensured? What will be the role of the European Parliament? Will this new perceived Central Bank structure be answerable to the European Parliament or to the Irish Parliament? Will we have representation on the Central Bank in the European context? We will have to know the relative roles of the EC and the national institutions to this policy option. What about convergence, economic and social cohesion and the balance between market and other mechanisms?

Our party leader, Deputy Spring, earlier this year addressing a conference of socialist leaders in Ireland, made a very strong statement in connection with the possibility of the implication for Ireland and for us as a socialist party within Ireland and the Community. He said:

Economic and monetary union is a logical step from the internal market process. Its purpose is to present Europe with the possibility of currency and price stability and an end to damaging fluctuations in interest rates. EMU will, of course, bring with it the need for much greater financial discipline in each of the economies of Europe and that may represent a particularly painful part of the process. The overall concept may well demand both an EC Central Banking system and perhaps, ultimately, a single currency and we fully accept the need to proceed with work on both these concepts....

We are not interested in EMU simply for its own sake or as part of a process of liberating financial markets to greater heights of speculation. The European Community and its member states must not be sacrificed on the altar of strict monetary policy unconnected to broader economic concerns. European monetary union must imply both economic and monetary policy considerations. The overall approach must support an economic policy aimed at securing sustainable growth and the translation of that growth into jobs through a coherent industrial strategy. In addition the issues of regional development and convergence must remain as central to the economic policies of the Community together with policies aimed at ending the poverty and marginalisation of so many of our people.

Deputy Spring was saying that all the talk is about the monetary union aspects of these principles and concepts such as the Central Bank, the common currency, interest rates and the question of the full integration of this programme. However, very little is said about the economic consequences and what the economic policy of European monetary union will mean for the regions of Europe which are disadvantaged or marginalised. That applies, to a very large extent, to the Irish economy which has major problems in the area of the development of the regions. This has been shown by our recent application for reclassification and redefinition of disadvantaged areas because we have the most disadvantaged regions in Europe.

It is important, in any monetary union, that we should have regard for the disadvantaged areas because many people in rural Ireland depend on the benefits of a regional and structural programme and that has not been pursued by this Government with any vigour even in the present structures of the limited regional funds which are available.

Mr. Spring continued:

All of these issues — economic and monetary, industrial, regional, environmental and policies aimed at improving the rights of working people — are interrelated. And all of them are much more likely to find proper expression if the goals of economic and monetary union are set by national and community democratic institutions, including the European Parliament and Council, rather than by Central Bank Governors.

It is very important to have an understanding of what we feel about the democratic deficit in the European context. It is important that, when you have directly elected people in the European Parliament, their role and powers should be extended. It is very important that we all believe in the collective responsibility of the directly elected European Parliament rather than imposing powers. We know that this Government, in particular, are very loath to do that because, within the context of the European Parliament, they are a minority grouping which have no influence on European policy or the European Parliament. They have only limited powers within the Commission and the Council of Ministers from a socialist point of view. It is also important that democracy should be seen in these areas of the Commission and the Council because they are appointed by Government. Although the Taoiseach felt that they were directly representing the people, they are not elected by the people to these roles and most of their work is carried out behind closed doors. We only hear about decisions when they have been made and policies decided; we are literally discussing the decisions with hindsight. Therefore, it is important that those two institutions are democratic.

I am satisfied that, with the direct franchise of the people, the directly elected European Parliament has been given a democratic role. However, there is a democratic deficit within that parliament because many of their roles are restricted. The Labour Party want a liberalisation of that democratic role and further powers conferred on them. I know these matters will arise when we have a debate on any further referendum which might be involved in 1992 in connection with a further European Act.

The link between national parliaments and EC institutions must be strengthened and the so-called principle of subsidiarity must be applied. National parliaments may also need to be reformed, as mentioned by Deputy Barry. There is no doubt that in participating in the structure of national parliaments one would welcome a reform which would allow the democratic process in this parliament to be renewed and reviewed; we hope that changes will take place because it is important that we are all more accountable and relevant than we are sometimes seen to be. This new role and relationship is essential if our own national identity and input are to be maintained.

The socialist group in the parliament, the largest group, have made a submission to the parliament on the matters which we have been discussing this morning. The Labour Party do not have any problems with the items dealt with by the Taoiseach regarding economic and monetary union. The Taoiseach said that 11 member states had agreed to an open market system, price stability, growth, employment, sound financial and budgetary conditions and greater economic and social cohesion. We identify with all these aspirations. The Taoiseach also said that there is a procedure for preparing the move to the third and final phase of EMU but that, before this is done, there must be a report to the European Council on the functioning of the second phase and, in particular, the progress achieved on real convergence. We do not have any problems generally with that aspect of the Taoiseach's speech.

The socialist group in their report considering a range of policy issues which were raised in the process of moving towards monetary and economic union in the Community suggested that the starting point in this was the Delors report which is the primary source of the concrete proposals for monetary integration now being debated here and throughout the other 11 member states. The summary of their submissions on monetary union to the parliament suggest:

1. Centralisation of monetary policy at the European level is an essential condition for achieving the economic and social goals of the Community. Under the present EMS, inflation has been brought down significantly in most countries, but monetary policy in the Community remains too fragmented to protect internal economic policy from financial market forces. A centralised monetary system is essential to enable other aspects of policy to be directed at objectives of balanced economic development and higher employment without jeopardising price stability.

2. The measures now being taken in the transition to monetary union leave national governments even more vulnerable to financial market pressure than before. The abolition of capital controls and the removal of restrictions on competition reduce the means available to governments to balance internal and external objectives and achieve an acceptable compromise between domestic economic development and the maintenance of financial stability. To the extent that they are less able to keep their exchange rates within the bands fixed under EMS without jeopardising internal growth and employment aims, there is an increasing risk of withdrawal, or at the very least frequent parity changes.

The socialist group go on to say that:

4. Any central monetary authority established at the Community level must have final responsibility for conducting monetary policy. It should be charged with securing financial stability and avoiding excessive inflation, but in pursuing these aims it should be obliged to take account of other objectives, balanced economic development and the maintenance of high levels of employment across the Community in particular.

These trends in relation to developing the economy and the economic consequences of monetary union are reflected not only in the socialist document but in Deputy Spring's speech. It is essential that in anything we do in the area of monetary union we do not marginalise the people at risk, the unemployed and the people who are forced to emigrate. They must not be forgotten and further marginalised by any union within the Community. Any central monetary authority must be accountable to a democratically elected body. The European Parliament is an obvious body. The European Central Bank system must be accountable to a representative body to which people representing each country can be appointed. It must be a democratically elected body, because elected representatives are responsible in the last analysis to the people. This does not mean that there should be political interference in the day-to-day operations of the bank. The authority should be obliged to report regularly on its activities and justify policies. The governor of the bank should submit a report to the European Parliament and should be examined by the parliamentary committee and we through the Oireachtas joint Committee on EC legislation should be able to debate the report.

In relation to budgetary policy for macro-economic development the socialist group suggests that:

The aim should be to agree a set of principles for the conduct of budgetary policy which would allow national governments to pursue legitimate development objectives. Though running budget deficits on current account over the long term might normally be discouraged, governments must be allowed to run deficits to counter temporary downturns in economic activity or to meet high debt interest payments. Governments must also be allowed to borrow to finance expenditure programmes aimed at strengthening their economies and/or achieving a better balance of activity. Such spending programmes should include not only investment in physical capital but also in education, training and know-how which increase the skill level and capabilities of the domestic labour force.

To some extent our Government are pursuing that sort of policy under the aegis of FÁS, and we are using European funds to assist us. These schemes however are only interim schemes to retrain people. If we retrain people we must ensure that the economic policy following from EMU accepts that employment must be created in our own economy. We cannot depend on outside sources to produce the jobs. We have often depended in the past on the private sector and have been disappointed. The private sector have not always translated profits into creating additional jobs. The first priority of the private sector is to make profits. That means that the State must have a central role in creating job opportunities, and in creating an environment which will stimulate the private sector. There should be a greater use of the National Development Agency to co-ordinate efforts between the public and private sectors. The National Development Agency has been made practically redundant by this Government. If we are using Structural Funds to retrain our unemployed workforce, they must have something to work towards at the end of the day, not just the emigrant ship or employment opportunities in England, America or on the Continent.

There will be an increasing demand for jobs from the emerging Eastern European democracies. These countries are underdeveloped and the change over to a different system will create large-scale unemployment in these areas. This will put additional demand on the Community. Europe as an economic structure should welcome the membership of the weaker nations. The European Community will expand into Eastern Europe and the emerging nations in Eastern Europe should be welcome into the economic Community but they have a huge impact on the existing monetary structure in the Community. We must prepare for that. I hope that today's debate will highlight the implications for all of us. I hope the Government will take another opportunity to return to the House in relation to the development of political union. That will have a great significance for members of this party, for this country and for its future neutrality within the EC.

The point which needs to be made at the beginning of this series of statements is that this is not an adequate way to deal with some of the most important discussions and debates that are going on at the moment within the European Community. A series of events will take place over the next couple of months. This weekened there will be a meeting in Paris of the non-governmental organisations related to the CSCE. Later in November there will be a Heads of State meeting under CSCE. There will be a Conference of National Parliaments and the European Parliament around the end of November and the inter-governmental conferences will be held in the middle of December. They will be shaping the Europe of the future and, to a large extent, this Parliament, our committees and the public are not involved in the debate and are unaware of the issues being debated which, as I have said, will have such a profound impact on the future political life of this country. For instance, they should have a profound impact on the way this House does its business but there is no indication of any thinking going on in relation to what that impact might be or how we will in the future relate to the European Parliament, the European Council, the Commission and a whole range of other institutions in existence and which may be altered, or created in the future.

The matters which are currently being debated, and which will produce decisions one way or the other in the not too distant future, will result in changes at least as great and profound as the changes which arose here as a result of our entry to the EC in the early seventies or, indeed, the impact of the Single European Act, which was passed here in the mid to late eighties. While I, therefore, welcome today's debate, the level of information which has been provided by the Government both to the Oireachtas and the general public on their discussions in the Council of Ministers, and their intentions with regard to political and monetary union, is for all practical purposes non-existent. We have had, virtually for the first time, a statement from the Taoiseach which outlines a number of options but gives no clear indication of the Government's thinking in relation to those options.

To take the implications from the rapid movement towards political union, for instance, I find it amazing that despite the Irish EC Presidency earlier this year there has been no clarification from the Irish Government of their position on issues such as Irish neutrality, European Security, the United Nations or subsidiarity as it affects the European Parliament and the national parliaments of member states. Indeed, there are no proposals for tackling the democratic deficit which is referred to constantly within the European context. That is not to say that the Taoiseach did not address or refer to those issues, but he offered no clear ideas or signals of the direction in which the Government are moving. At the time of the Irish Presidency the explanation given was that as President of all the Europeans we were facilitating all member states to discuss the issues and not imposing our position.

We are now approaching the inter-governmental conference in mid-December and still there is no clarification of where the Government stand. Take the example of the current Italian Presidency, still only half way through its term, which shows a very clear determination to lead the debate on where they want the Community to go. In very sharp contrast also, there have been proposals from the Belgian, Dutch, Danish, Spanish and Greek Governments, and the detailed reflections of the Commission itself. Despite very specific proposals from the Italian Foreign Minister for a unified European security and defence system, we still do not know where exactly the Irish Government stand on the issue. More recently I have read that it is now proposed that progress towards a unified security policy can take place while allowing a country such as Ireland to remain outside the debate and decision-making. That would leave Ireland neutered, not neutral.

To my knowledge the Department of Foreign Affairs have expressed no position on the matter. Initial comments from the Minister for Foreign Affairs such as, "what has Gianni de Migelis said now", are no response to the intense series of initiatives and proposals to create a new security network in the Community. It is simply not good enough for the Government to stand back from the discussions as if they, or the discussions, were irrelevant. When asked on 10 September last if he supported the US contention that Article 52 of the UN Charter provides legal cover for a military operation, he is reported as having said, "we have had no discussion on that", and that he could not give an opinion "on what could be discussed at some future EC meeting." This is a further example of dodging, and failing to establish a clear position on where Ireland as a neutral country stands on the role of the United Nations in international peacekeeping and enforcement of international law.

I want to reiterate that neutrality should not be defined as isolationist and should not result in us being marginalised and stood in a corner while the big boys decide on the future of Europe. It must mean that we are in there arguing, debating, discussing and pushing our concept of what Europe and political union should be and what security and the future defence, if necessary, of Europe should include. The Taoiseach indicated in his statement that the question of disarmament might be an aspect of defence and security. If Ireland is neutral in any sense of that word in the modern world then surely disarmament has to be — and we must insist on this — part of the discussion and debate about future security. It has to mean that we stand out against the possibility that the European Community as a body would acquire chemical or biological weapons and insist on the disposal and destruction of nuclear weapons within the European Community. We should be taking a stand on all of these issues and not standing back from the debate.

The Taoiseach is on record as stating that he is in favour of development of the CSCE process as a means of dealing with security issues throughout Europe. Everyone is in favour of the CSCE. The Taoiseach should tell us how he proposes to make the CSCE a viable and effective structure in the post Cold War situation. The CSCE needs stengthening if it is to play a long term and meaningful role in the new world order. CSCE Heads of State are scheduled to meet at the end of November in Paris and Ireland must be prepared to adopt more than a passive role on that occasion. Ireland, for instance, is not a member of the neutral and non-aligned group in the CSCE. Can the Taoiseach explain the continuation of this anomaly? The explanation given in the past was that as members of the European Community, the Community adopts a single position within the CSCE. However, that should not preclude us from having an association with other neutral and non-aligned countries within that body.

It would seem that when the era of the old military blocs is disintegrating, closer association by Ireland with countries like Austria, Sweden, and Finland, and the newly independent Central and East European states, would be a logical means of assisting the creation of a new European and world security order. Yet the Taoiseach tells us nothing about what discussions, if any, he has had with the Governments of these countries on security issues in the past year, presumably because there have not been any such discussions.

I contend that Ireland should be actively promoting new structures within CSCE itself to deal with issues such as inter-regional conflicts and disputes in Europe and verification and enforcement measures to ensure compliance with security arrangements. Reassessment of current decision-making procedures, such as consensus, is required. Setting in place a more binding and legal framework for CSCE must also be examined.

Ensuring the full involvement of the US and Canada in these structures will also be important, not least to allay any fears of a "fortress Europe" emerging on the other side of the Atlantic. It would also assist in ensuring that the United States Government in particular operate within the constraints and demands of the world community in much the same way as they have been constrained in the Gulf crisis by the United Nations.

The Warsaw Pact and NATO now resemble two struggling dinosaurs. Ireland, having remained outside such military blocs and structures in the past, should now be to the forefront in proposing new and fresh paths for a Europe in which there would be neither an expectation nor toleration of war. It strikes me that the Government have no interest in our intention of playing such a role. The oft resorted to statement that we are "militarily but not politically neutral" leaves the Government, as it left their predecessors, afraid to take any initiative which has not been cleared elsewhere. Ireland's low standing in this regard seems to have been illustrated by the fact that neither the US nor USSR Governments seriously considered this country as a neutral venue for any of the arms reduction talks which led to the ending of the Cold War.

It now appears that the "with it" strategists in the European Community may not even believe that Irish neutrality is worth wasting energy on. Their approach seems to be: "Ignore it and let us get on with devising a new EC military and security policy. The Irish will not mind being left in the corner."

The Workers' Party believe that Ireland must play a full part in the discussions on the future of European security. It is ridiculous that we can profess to belong to an economic and political community and yet pretend that its discussions on issues such as a European army, the production and deployment of nuclear weapons, sales of arms to the Third World and reaction to world trouble spots, are not our concern. However, there is a world of difference between participating in such discussions with a view to pursuing the issues of peace and disarmament and discussing the level of our participation in a military pact.

We must take an active role in insisting that the European Community follows a non-aggressive security policy. We must question why the membership applications of countries such as Austria are being delayed. The argument apparently is, in the words of Deputy Barry, that we must deepen the Community before we broaden it, but I suspect it has much more to do with the existing members being anxious to copperfasten their already privileged position, economically and politically, before allowing outsiders in to share the spoils. If Ireland does not convey a clear position of its policies in these areas then we will become as peripheral politically as we are geographically.

There is a need also for Ireland to refine and develop its view on the function of the United Nations. With the ending of the Cold War, the United Nations recently took on a more significant role in world affairs. Its activity in assisting in the transition to independence of Namibia and its current more far reaching proposals to oversee democratic elections and implementation of a peace settlement in Cambodia are two clear examples.

The United Nations structures are now four decades old. They were devised out of the ruins of the Second World War and hindered in their development by the politics of the Cold War. It is now time to re-examine the workings of the United Nations to make it a more truly representative voice of its member states. We need to examine the nature and composition of the Security Council and the role of the veto exercised by the permanent representatives on that body. In addition, there is a need to examine the powers which the United Nations should have in dealing with world trouble spots. The United Nations rather than any individual or group of states must be the only permissable "world policeman". We should be prepared to play a full role in promoting the development of the United Nations along these lines. This would be one useful means of developing Ireland's neutrality in a more positive and modern way.

The current crisis in Iraq is worth examining. The Government have rightly supported a coherent and united approach by both the European Community and the United Nations to the Iraqi invasion and occupation of Kuwait. It is to be regretted, however, that the Government have failed to take any specific initiative which would move the situation on to the next stage. A clear emphasis on the primacy of the United Nations in the early stages of the crisis when the United States Government were forcing their hand and leading a military build-up in the region would have been one appropriate action for a neutral country such as Ireland.

Within the past few days we have heard new threats from the United States that an invasion of Kuwait and/or Iraq is on the cards. I would like to see the Government issue a clear assertion that the United Nations is the only body which is entitled to make such decisions on military action. Unilateral action by any one country, especially if an attempt is made to dress it up under UN auspices, would destroy the credibility of the United Nations, as happened with the Korean crises over three decades ago. Indeed, the negative effect would probably be even greater this time round as there is not even the excuse of a Cold War to fall back on.

Many other issues of continuing international tension require the attention of the Government, the European Community and the United Nations. The Palestinian question is one such example. Numerous United Nations resolutions on this issue have either been blocked by a United States veto or, if adopted, ignored by Israel without any sanction by the United Nations whatsoever. The international community must act decisively to force the Israeli authorities to agree to an international conference, which would involve the Palestinian Liberation Organisation as full participants, with the function of agreeing a homeland for the Palestinian people and guaranteeing the security of Israel.

There is a broader issue of development aid. Two-thirds of the world's population live in a state of underdevelopment. Hundreds of millions of people live on the verge of starvation and every year an estimated 40 million children die due to lack of food and basic medical care. The ending of the Cold War offers a new and vibrant opportunity to tackle this scandal. We must seek a transfer of funding away from arms spending and production and the promotion of vast sales of arms to Third World countries; instead it should be spent on assisting economic and social development measures.

The question of the "democratic deficit" within the European Community was addressed by the Taoiseach in an indirect way in his contribution this morning and it must be addressed seriously. The huge momentum of the past year would certainly indicate that the time has indeed arrived in the European Community to "transform relations as a whole among their states into a European union and to invest this union with the necessary means of action" as predicted in the Single European Act and further asserted in the joint letter of 18 April last from President Mitterrand of France and Chancellor Kohl of Germany.

The holding of a congress of European Parliaments, formerly known as the Assises, offers the potential to allow the Community's democratically elected bodies to partake in a truly democratic discussion and decision on how the process of European union could be achieved. The problem is that the agenda is still far from clear and neither is there any clear view of what should result from the congress. By virtue of the failure of the Irish and other EC Governments to promote the congress as a means of facilitating democratic discussion and decision making, there is a danger that it may result in simple rhetoric and hot air. The European Parliament will not have been assisted to take on a truly effective role in representing the Community's 340 million citizens and I hope that this is not the desired outcome as far as national governments are concerned.

With regard to the issue of the democratic deficit there is an even wider question. This morning the Taoiseach stated that he believed the European Council and the Council of Ministers are democratically accountable to the citizens of Europe but the reality is much different. The fact is their meetings are held in secret and we only know what they choose to tell us. They report after the fact to this House on what decisions they have made. For instance, the Government have not told us today what proposals they intend putting forward to the Heads of Government at the CSCE or at the IGC in the middle of December. There is no real accountability. After decisions have been made we are told what they have done and in many cases we are not even told this much. We are then given the opportunity to stand up here and make statements in response to the statement made by the Taoiseach having only received that statement half an hour earlier. That is not an adequate way of dealing with the major changes taking place in Europe or of dealing with decision-making within the European Community.

The other aspect of the democratic deficit relates to the fact that in Ireland and in other countries there is a very under-developed system of regional government. Our local government structures are highly undemocratic in the way they operate. There is a need to consider that point and also the way they relate to central Government. The democratic deficit does not exist only at European parliamentary level but also at national level. The issue of democratic accountability can no longer be ignored. Recent years have seen power increasingly transferred from national parliaments to the centre of the Community. This power has not been taken on by the democratically-elected European Parliament. Instead it has been transferred to a group of 12 ministers who meet in virtual secrecy. As a body they are effectively beyond democratic control and influence from national parliaments, from public opinion or accountability. They are isolated even from criticism itself. Likewise the European Commission is not a valid body to represent the democratic wishes of the citizens of the EC.

The European Parliament has had to struggle to obtain its current limited status. It is farcical to suggest that we can move rapidly towards European union and refuse to move equally rapidly towards European democracy. At present decisions are being made by technocrats and diplomats and are being presented to parliaments as a fait accompli.

The amount of time devoted by the Oireachtas is a case study of how vital European issues are never referred for proper discussion. Even during the recent Irish EC Presidency, the Dáil was simply allowed to make statements rather than adequately debate the Irish Government's role.

I am not suggesting, of course, that all powers be transferred from national parliaments to the European Parliament, but rather that there be a complementary democratic role and links between the European Parliament and its counterparts in member states. It is clear that on some issues such as control on the proposed European Central Bank, national parliaments will be unable to exercise the necessary control over general policy direction. They will not be able to do so either individually or acting as a disjointed collective.

It is interesting to note that the Taoiseach could not bring himself even to refer to the European Central Bank in his speech today. He talked about institutions which would arise from the co-operation of national banks. He was, of course, talking about the European Central Bank but refused to use the phrase.

There are, however, many matters which can be better handled by the national parliaments. The objective must be to keep the democratic institutions of the EC as close as possible to the citizens. A closer and more structured relationship between the national and European parliaments, involving frequent consultative meetings, regular fora such as the forthcoming congress of parliaments and provision for reciprocal attendance of committee members at each others' meetings would be some of the ways in which this could be furthered.

Arising from this there is a vital need to strengthen the rights of the individual citizen under political union. This should be guaranteed through the adoption of a democratic charter in the Community.

We must not forget the millions of people who live within the Community but are not legal citizens of the Community. They are one of the most exploited groups in the Community. When we are talking about the rights of European citizens we must not forget those who are not citizens. It is estimated that about 70 MEPs could be elected by migrant workers in the EC if they had a vote. This is an area about which Ireland should be concerned. We have unfortunately a long tradition of sending our people outside this country to live and work, both within and without the EC, and we know the problems they have faced over generations.

On economic and monetary union, increased attention must be paid to the effects of the economic situation on peripheral regions such as Ireland and to the need for adequate guarantees and action to safeguard and improve people's social rights in the new internal market.

The proposals, now well advanced, for the establishment of a European Central Bank, or EuroFed, will have dramatic implications for fiscal policy and economic direction in this country.

I am disappointed that the Basic Document of the European Commission for the Integovernmental Conference proposes virtually no role for the European Parliament in controlling EuroFed. While the Commission and Council will have a central role in appointments, surveillance and drawing up overall economic policy, the Parliament will simply be "consulted", "will debate" or be "associated" with the work of the other two institutions. This reads like a recipe for economic and fiscal policy being decided by dictat, with the democratically elected European Parliament relegated to commenting or complaining about the results afterwards.

All the evidence points to an escalation of the trends towards economic peripherality for regions such as Ireland under EMU. Policy must be geared to a reduction in existing regional disparities, with a substantial upward revision of Structural and Regional Fund allocations to enable peripheral regions to adapt to and survive in a completed Single Market.

I believe that the Government have so far failed to defend the interests of the citizens of this country in their negotiations on the Single Market or to ensure the development of a Social Europe — one committed to the wellbeing of Europe's people as well as its economy and industry.

The detrimental effects of the Single Market on Ireland's peripheral economy must be tackled by an EC policy geared to assist this country to overcome the effect of changes in taxation and customs regulations, and for any loss of industry and jobs which will result from the removal of trade and economic frontiers in the Community.

Living standards in Ireland relative to other states failed to improve during the eighties. We are still at just two-thirds of the average. This process of peripheral regions losing out economically will continue and accelerate under the Single Market unless decisive action is taken to reverse it. At the end of 1991 the European Commission will make a full assessment of structural policies and make recommendations on their continuation and improvement.

The Government should be moving now to strengthen structural policy and funding, rather than be content to continually seek a bigger handout in the begging bowl. The restructuring of CAP, rather than being allowed to drag on for years, should be grasped and used as a means to launch a Common Industrial Policy, which would see funds transferred to job creation measures — both in agriculture and industry. As funding for CAP is reduced, it should be transferred to Structural Funds, where Ireland, as a peripheral region, could rightly demand and insist on increased allocations to assist economic development.

This should be in areas where we can hope to successfully compete with European competition in the open market. Two areas which immediately spring to mind are food processing, based on our grossly underutilised agricultural production, and high technology, based on the low cost of transport of raw materials and finished product and the likely increasing market in this area in future.

Most of the current structural funding spent in Ireland is on infrastructural development. While such development is necessary, it must be accompanied by industrial investment and expansion or we will continue to experience industrial decline and rampant emigration.

Consideration should also be given to widening the eligibility criteria in structural policies as a means of assisting development in less favoured regions of the Community. For instance, overcrowding and lack of resources in education in Ireland require urgent tackling.

Recent Governments have deliberately refused to allocate sufficient resources to reduce class sizes. Community funding would help tackle this problem and ensure equal opportunity of access to children of working class families.

On the question of social legislation, the Irish Presidency saw little or no progress in implementing an action programme on the Social Charter. Tens of thousands of people continue to be exploited in part-time, temporary and contract employment here. They are exploited through low pay, poor working conditions and lack of job security.

Earlier this month the Minister for Labour yet again promised legislation to tackle such abuse of the most vulnerable members of the workforce. I hope this Dáil session will finally see the long awaited Government Bill.

At EC level there is need for a strengthening of the Social Charter to make its provisions binding on member states rather than aspirational. I am thinking of other vulnerable sectors whose position will be affected in the absence of adequate EC social legislation, people such as the disabled, senior citizens, women, the young and indeed the migrant workers to whom I have referred already. I should like to see the Irish Government bring forward proposals to strengthen the Social Charter in these areas. In short the Government face a major task in ensuring that the current rapid moves towards political, monetary and security union are not effected at the expense of the interests of our people or those in disadvantaged areas in Europe or the Third World.

I urge the Taoiseach and the Government to take on board the points I have made and ensure that they are pursued at all levels of EC debate in the coming months.

I welcome this rare opportunity for back benchers to make a contribution and express our feelings about European development generally. While this debate is more in the nature of statements it may be of considerable benefit to the public at large, especially many who do not realise the work done by some of the subcommittees of this House. I might refer in particular to the Oireachtas Joint Committee on Secondary Legislation of the EC. There are a number of subcommittees of that committee which are very active, producing regular reports which are presented to this House but which, unfortunately, are not debated on many occasions. It is important that the work of those sub-committees be brought to the attention of the public. This debate affords us an opportunity to demonstrate to the public the effects of some of the decisions of those sub-committees.

I welcome the Taoiseach's statement earlier to the effect that he feels that the terms of reference of that sub-committee should be reviewed now. That sub-committee has been operational since 1973 when we first became a member of the EC. After a period of 17 years it is time we reviewed the constraints under which we operate. The fact that the Taoiseach has said also that that committee could possibly serve as a foreign affairs committee constitutes a major step in its development and future. Not alone will it be a committee which will deal with the legislation prepared within the EC but it will have a role to play also in making available the comments of Members of this House on foreign policy.

If we examine the development of our country since entering the EC in 1973 we can see the decided benefits of our membership and the enormous improvements that have taken place as a result of EC aid here generally. We can witness the ongoing developments with regard to our roads and other facets of Irish community life, in addition to the developments that have taken place in agriculture, education and the various other EC heads. Indeed our future development will be assisted greatly in future years by the utilisation of Structural Funds. The Structural Funds — to which I will revert later — have a potentially enormous contribution to make with regard to our future development generally. We hear criticism of the fact that we have not made full use of the aids available to us within the EC. Because of the constraints on national resources we may have suffered somewhat on occasion because of not having the resources here to back up some of the schemes that could have been availed of within Europe. Nonetheless we have improved our takeup rate in recent years. It is important that we ensure that the maximum funds available are taken up by all our institutions.

This debate affords us an opportunity also to examine a wider range of areas. It would be important that we examine our position vis-á-vis the EC and its strength as a trading bloc. There has been so much comment in recent weeks on the GATT talks one wonders how we would have fared had we not joined the EC in 1973. At present we approach the GATT talks from a common position within the twelve member states. It is important that we demonstrate the political muscle and Community support necessary to ensure that the GATT talks are conclusive and will be to the benefit of this country and the EC in general. There is no point in our going off on tangents, contending that if one sector wins another must lose. We must strike a balance. At the same time we must not sell out the principles of those talks which must be maintained vis-à-vis our basic position here.

With regard to the agricultural position of the EC within those talks it is important that smaller family farms are protected. We should not approach those talks on the lines that X number of small farmers throughout Europe will disappear from rural areas. That would not be a positive approach. We have a position to maintain and I have no doubt that will be done. Indeed our national interests, especially on the agricultural front, have been well protected to date by our Minister for Agriculture. I am sure that, at the future meetings to take place in coming weeks, our Minister will reiterate the position of Irish agriculture and our feelings with regard to those talks. Within that context we should examine our position with regard to imports to the Community from non-Community countries and their effect on the Community and especially on ourselves as an agricultural country. We are the only country within the EC mainly dependent on agriculture for our livelihood. We must accept, therefore, that we have a vested interest in those talks. Were we seen to be lax in any way at those talks we would do this country such a disservice that we politicians would never be forgiven.

The Common Agricultural Policy has been beneficial to Ireland in recent years but it is time it was re-examined. For example, it is unfair that a farmer who produces 300,000 gallons of milk should receive the same rate of subsidy as another who produces only 20,000 gallons. As of now it is an inequitable system. In view of the quotas and restrictions being imposed, it is important that we initiate an overall review of the Common Agricultural Policy in the years ahead with the aim of protecting its basic principles, which are to protect the smaller family units, so vital to this country. If that must be effected by means of additional subsidisation of our smaller farmers then it should be done in that way. We should not apologise for so doing. It would be regrettable if we reached the stage at which quotas were so small, were supported to such a high degree, that they would prevent farmers developing to a reasonable standard. In agriculture or any other sphere, it is vital that people make a livelihood from their produce. They should not have to depend on subsidies but, if there is to be a subsidy system, then let it be equitable. Let us ensure that the people who most need it receive the highest rate and are allowed to develop to a level at which they will not need any subsidisation. That train of thought would appear to be beginning to be accepted by many of our European partners.

With regard to the American position at the GATT round of talks, their Secretary for Agriculture came to Europe and proposed a reduction beyond what could be accepted by Europeans. They did not make it clear that under their own system their farmers have a much higher subsidy rate than European farmers have. That should be stressed and brought to the attention of the public.

We cannot look at Europe in the context of the Twelve. We must look at it in the context of Europe as a group with common policies. We must look at it with regard to our external relations and our relations with Eastern bloc and Third World countries. The changes that have taken place in recent months in Eastern Europe will have enormous consequences for the EC. They are the sort of changes none of us could contemplate five or ten years ago. The changes have come so quickly and are free-wheeling at such a pace that we need to be very vigilant. On the recent unification of Germany for instance nobody could have told us two or three years ago that the Berlin Wall would be sold in pieces right across the world to souvenir hunters. It was the sort of thing that was dreamed of but nobody believed it could happen. It happened mainly because East European countries, and communist countries in general, realised that our system of democracy is much more beneficial to the ordinary citizen than the system they have operated under since the Second World War. German unification will have major implications for the Community. Germany has been one of the major contributors of funds to the Community but now will no doubt see a need to help develop the other half of their country. I hope their commitment to development at home will not move down on the scale of priority their assistance towards the development of the Community and of member states.

We are a peripheral state of Europe. We depend on subsidisation under various headings to help us develop. If Germany's policy on funding the Community was to change it would have major consequences for this country. We could find that much of the assistance we received in past years would be reduced. That would be detrimental and would be against the basic principles of the EC. The Twelve in their deliberations over the coming months should continue to develop Europe as a unit, not as states but as a European unit that will be in a position to match forces both economically and politically against blocs such as EFTA who now see that the EC has developed as a major player in the world. We are no longer the Six that started out. It is now 12 countries spread across Europe and, in the foreseeable future, it will have to expand. The number of countries who have applied for membership and associate membership of the Community mean we must take a realistic, long term look at Europe to see how developments will take place.

It is hoped the internal market will be completed in two years' time. That is a major challenge to us. It is a major challenge to industry here to be able to compete on a level playing pitch. We have wanted it for many years but while a playing pitch may look level, like all playing surfaces it will have its bumps. Some industries may find it very hard to compete against their European counterparts. For instance, at the moment our agricultural products are being sold at approximately 70 to 80 per cent of the price being received in other member states. We may develop our roads but we will have the extra cost of transport to the major market of Europe.

Any of us could talk on this topic for an hour without having to refer to notes. It is of major importance to every citizen. How the EC develops over the coming years will be of major importance, maybe not so much to my generation but to those at all levels of education. They will have to face the fact that when they leave qualified they will be Europeans, not Irish, English or French. It is time the nationalistic approach that has been adopted especially by one member of the Community at the moment should be reviewed. The British attitude is that they are greater than the other 11. We are all equal members of a Community that was built on trust and negotiation, a Community that was prepared to compromise. Consensus should be the approach but the British approach in recent times has been one of defiance. If they had been a little more forthcoming over the past four or five years in deciding to join the EMS and make other decisions which were of major importance, they would not have the economic problems they have today. Those economic problems are affecting us because interest rates in the UK affect Irish industries. The free movement of capital in the years ahead will mean we will have to compete against a very lacklustre UK economy. Their recent decision to join the EMS was one of necessity to try to turn the tide in favour of a Government who are now at a very low ebb as far as public support is concerned.

In the time ahead it is important that we play a full role in Europe's development. We should not be seen as one who stands back but as a leader, as a country prepared to make a contribution. Indeed, in recent times this country has made a contribution, maybe not in the public eye. The parliamentarians of this House made a contribution at recent conferences with regard to the Rome Assises. We stressed the fact that the new goals of the Community with regard to economic and monetary union and political union have consequences as far as we are concerned and that those consequences must be dealt with in a fair manner. The problems that arise must be settled by negotiation and in no other manner.

We have a role to play. The Dáil, and the Seanad, have a role to play, but we as parliamentarians have a major role to play to see to it that we continue to press for the development of an integrated Europe. It is in our interest to do so. It is not in the interests of any group other than our citizens. We do not want to find ourselves left out. We are the only island state as far as Europe is concerned because yesterday's breakthrough with the channel tunnel when the two groups of workers met means the UK is now part of Europe. They have a land link. It may be under water, but it is there and we are now the only island. It is up to us to see to it that we are not left as a peripheral state, that we make sure that the developments taking place will help to integrate us into the EC at a faster rate than we have developed over the years.

A Chathaoirligh, I want to say thank you for the opportunity of putting my views before the House.

Like the last speaker I am delighted to have the opportunity to make a contribution to this debate for a number of reasons, one of which is that I, too, am a member of the Joint Committee on Secondary Legislation of the European Communities. Since I became a member of that committee I have had the opportunity to observe development towards European unity since long before European unity was mooted.

One of the things I found encouraging this morning was the constructive exchange between the Taoiseach and Deputy Peter Barry with regard to the possible expansion of the role of that committee. We, the members of that committee, would certainly like to see its role expanded so that we might discuss without restriction the major developments that take place in Europe virtually on a daily basis which have an impact on this country. If that means a broadening of that committee towards a foreign affairs committee, so be it. The name of the committee could be changed if necessary. The broadening of that committee would be desirable and it is something I would wholeheartedly support.

At this juncture I would like to review the portrait painted for us over the past five or six years of a united Europe. I do so on similar lines to those drawn by Deputy Ellis. This country has undoubtedly benefited greatly from our membership of the European Community. We should never forget also that we have been very constructive members of that Community and have contributed a great deal to ensuring that the Community developed towards its now stated objectives. The various Governments representing this country have been most constructive in their approach to Europe and have supported the EC from the beginning. There are those who might say that we had a vested interest in so doing, but whatever our interests we remained constructive throughout the various changes of Governments over the last number of years. We should not lose sight of the fact that the approach of our public representatives to Europe was always constructive.

As Fine Gael junior spokesman on trade and marketing I have some reservations about just how influential we are within the Community at present, and this cannot be over-emphasised in the context of this country's interests. I know it can be said that certain developments are inevitable, but if we go into any arena assuming the inevitability of the outcome, then there can only be one outcome. That is something we should never forget. I mention that specifically in relation to Europe and the GATT negotiations.

I feel we have been let down by our European partners on a number of fronts. We have been let down by the European Commission — I do not want to be political or personal about it but I feel that the greater European interests are being upheld at the expense of our national interests. I speak as a strong supporter of European integration, economic and monetary union and all that they entail. I realise fully that the alternatives are limited. I have to say, however, that if we proceed along the lines we have been going over the past two or three years, then we will become a very small cog in a very big wheel.

In the last ten years or so the picture that was painted for us was of the strength of the economic unit of the European Community. That strength was obvious to everybody. We were given to understand that the changes in relation to transport and free open economies would be beneficial. We hear a lot about open market economies. This is not a new concept; it has been running since time immemorial. The odd thing about it is that some of the people who now speak of the merits of this alleged new concept are the people who themselves created barriers and tariffs and obstacles to it.

Those comments are a roundabout introduction to what I feel has been the European Community's almost total capitulation to the US approach to the GATT. I accept that rationalisation is to be expected. I accept also that certain changes must take place in relation to both agriculture and industry which will not be exactly beneficial to many interests here; but if we allow things to go ahead as they appear to be then the impact of our initial entry into the European Community will have been lost, and we all know that many industries suffered greatly as a result of our initial introduction to the forces within the Community. The further suffering would be colossal in comparison to previous suffering. I say that not by way of criticisms but by way of genuine concern about what is likely to happen.

There are various buzz words emanating on a daily basis by way of Eurospeak. Let us look at some of them. We have heard about the two speed Europe. Everybody objected to that, and rightly so, because nobody wanted to see the interests of the major powers advanced to the detriment of minor powers, such as ourselves. The next buzz word was "fortress Europe", but the Americans demolished that very quickly in the course of the GATT talks. Fortress Europe is long gone. We now have reciprocity. That is almost gone as well. Now we have subsidiarity. I could go on and on with the Eurospeak that I believe has been thought up by some bureaucrat to confuse us so that we will not know what it means.

The security we were to gain from our support of and involvement in the total European concept is not what we were led to believe it would be. Outside forces, such as the US, have put extraordinary pressure on the Community, forcing it to change policy dramatically in line with the requirements not of the Community itself but of those outside interests. Where, then, is the strength that lay in our involvement in the entire Community? What about the huge market we have there? Where is the force of that market if we are so easily pushed aside in the course of these negotiations which are now taking place? Surely it was in someone's interest to point out that we cannot allow ourselves, or the European Community cannot allow itself, to be pushed around in a negotiating area like that, and I use that word advisedly.

A two speed Europe now appears to be emerging in that we have the super powers deciding, virtually on a daily basis, on what they see as being desirable and invariably it coincides with what is desirable from their own economic viewpoint. The previous speaker referred to the attitude of the British Prime Minister in recent times. I agree that the European Community would be better off if the UK had adopted a more constructive attitude to it.

With the developments that have taken place in Eastern Europe there is obviously a change of emphasis and a shift in the balance of world power. We had an opportunity to say a few words about that on the very short debate we had on agricultural matters. I expressed the view then that if the balance of world power was the same now as it had been four or five years ago attitudes to GATT would be vastly different as would attitudes to Europe, and the attitude of the strong economic powers in Europe vis-á-vis us would also be different. There was greater recognition of the so called pivotal role which small economies could play then than there is now.

The Commission must be told that their interests lie in Europe first and that their duty is to represent us Europeans. They must be told that our interests are inextricably tied up with theirs. They should remember that. The Council of Ministers need to be told that their interests must first lie with their own country. It is all very fine to say that inevitably certain changes will result in half of our farmers disappearing off the horizon, but if that happens somebody, somewhere, will pay a price. It will not be the Commission or the Council of Ministers who will pay the price, it will be those Deputies in the House who represent the people. We must have regard to the way our case is dealt with at European level and the way in which Europe deals with others on our behalf. I try not to be overly political in debates of this nature which should transcend all political barriers, but I am parochial enough to think of our own people first and recognise that we have a duty to them.

One of the things that would have amused me if it had not been so serious was that in the heat of the negotiations taking place in relation to the testing of the water with GATT and so on, a proposal was made to dramatically reduce agricultural supports while at the same time certain agreements would be made with other European member states the result of which would have meant the continued importation of cheap feed substitutes which would ultimately lead to a further deterioration in our agricultural industry.

I am sure Mr. Andriessen is a very competent Commissioner who does a good job. I know he cannot answer for himself but that attitude rankled with the people I represent and it begs the question: what role now for the smaller countries or the less influential countries within the EC? We in the Oireachtas should nail our colours to the mast and let it be widely known that while we may be a minor entity in the Community we have interests and have served the Community well to date. We have never diverged from the central objective of a united Europe. We have been supportive at times when our support was vital. Let our bigger brothers within the Community remember that. It is not inevitable that as a result of market changes a large sector of our population should lose their livelihoods nor is it inevitable that we must bow before the superior negotiating powers of other agencies. It is not inevitable that our vacuum packed beef will come from Texas. However that will be the position if we allow ourselves to be kowtowed into that subservient role.

I note that some people said a few years ago that involvement in the Community would ultimately result in a diminution of our sovereignty. We have received documentation from people who hold that fear in the last few days. I do not accept their view. We can play as strong a role now as we did seven years ago. It is up to us decide exactly what we want. It is up to us to ensure that we put the best foot forward and adopt the strongest possible stance. It is in our interest not to allow ourselves to be pushed around by the greater powers in Europe.

I am not saying that changes will not take place — these have been referred to by previous speakers. I know the developments that have taken place in Germany are having an impact and I recognise the important and constructive role played by Germany in the Community to date. That should not go unmentioned. We recognise the huge responsibility Germany has taken on in recent times and we wish them well. However, they and the other European powers must recognise that we also have a role to play. We looked after the interests of the European Community in the only way we could. It is now the turn of the major powers to ensure that our interests are looked after if new developments take place. If that is not done there will be a huge backlash and it will impact on us.

I hope we will have an opportunity to speak on these issues in the near future. I support the suggestion put forward by Deputy Barry that we should have a debate on this issue on Fridays so that all Members could contribute. We would be able to express our views freely and, more essentially, on a fairly non-political basis, because the interests of this country rest entirely with the total contribution of the Members.

There is a tremendous amount in what Deputy Durkan has said that I can agree with, particularly his last phrase. This is a matter that is completely non-political and is something with which we are going to sink or swim. While I agree with the bulk of Deputy Durkan's contribution, he was being a little pessimistic in using such phrases as "total capitulation" and "being pushed around". Since we joined the Community all Governments have done their utmost to make certain that Ireland's role is always to the fore, as the Deputy has said, and that the good of Ireland and the Irish people is always emphasised.

The Taoiseach said this morning: "In so far as Ireland is concerned, member states are now clear at the highest level about our position and I am confident that our interest will be fully taken into account in the forthcoming discussions in the Agricultural Council". I agree with Deputy Ellis's suggestion in relation to the future allocation of agricultural subsidies. The Deputy comes from the west where there is an enormous number of small farmers. We feel it is about time that Commission policy was changed to take into account the small family farm that was referred to in the initial Rome Treaty.

I do not intend to cover what the Minister for Foreign Affairs will say later but I would like to say a few words about the commitment of the European Community to developing countries, and point out that this commitment will not be diluted in any way by closer European integration.

The House will be well aware that the Community is one of the world's major donors. Next Monday at the Development Council in Brussels I will be discussing with my colleagues Commission proposals for a major expansion and improvement of our relations with the developing countries of Asia and Latin America. It is, of course, too early to be precise about the outcome of the proposals but it is fair to say that it will involve a very significant increase in the Community's aid both in terms of quality as well as quantity. The Community is determined to ensure that its presence in the world should be seen to have a positive impact at a time when some of our partners have expressed fears about Europe becoming absorbed by events within its own continent. At the same time the Community is also discussing the improvement of its co-operation with the developing countries of the Mediterranean region.

Turning now to the countries of the African, Caribbean and Pacific region, Deputies will be aware that the Fourth Lomé Convention was signed last December between the Community and the ACP group. I hope that in the course of the present Dáil session the House will have the opportunity to approve the terms of the convention. The Lomé Convention is widely recognised as a model for relations between the developed and developing worlds, based as it is on partnership and equality as well as the contractual nature of the commitments entered into. This is a point worth emphasising. Developments in European integration cannot alter our commitments.

The convention was negotiated at a time when momentous events were happening in Europe. The content of the convention, and its increased financial resources, are a sufficient testimony to our determination to assist our partners. As regards the level of aid, for example, it is very commendable that, in an international economic environment which is not favourable to increasing aid, the Community's financial contribution has more than kept pace with inflation. In actual figures the amount for the first five years of Lomé IV will involve 12 billion ECUs compared with 8.5 billion ECUs under Lomé III, an increase of over 40 per cent in nominal terms and over 20 per cent in real terms. While the ACP states would feel that the overall amount could be somewhat larger, nevertheless they recognise the highly concessional nature of the finance available. Indeed this concessional nature has been increased with the removal of the replenishment aspect of STABEX and the emphasis on grants for structural adjustment.

As far as Ireland is concerned, our financial contribution to the convention over the first five year period will be 60.17 million ECUs, approximately IR £46.8 million. It is highly significant, in terms of the doubts that have been expressed as to the Community's intentions, that the Fourth Lomé Convention was negotiated for a ten-year period rather than for the five-year period of the previous three conventions.

Our contractual relationship with the ACP states is absolutely firm and the convention is their guarantee. At the signing ceremony for the new convention last December, which I was honoured to attend on behalf of Ireland, both the Vice-President of the Commission, Mr. Marin, and the then President of the Council, the French Prime Minister, Mr. Rocard, emphasised that the improvement of our relations with Eastern European countries is perfectly compatible with increased support for development of ACP countries. During our own Presidency, I have reassured the ACP-EC Joint Assembly as well as the ACP/EC Council of Ministers that our relations with the countries of Eastern Europe and with the ACP group are complementary, not competitive. The volume of resources which the Community has devoted to the convention is ample evidence of this. I can say now that exactly the same applies to the Community's commitments to other developing countries.

As President of the Council at that time, I also reassured developing countries that the completion of the internal market is not designed to cut the Community off from the rest of the world. The Community is determined also that it should not damage their economic interests, nor affect the commitments we have entered into with them. A single European market can be an important source of economic growth and consequently it can provide new trade opportunities in which the ACP and other developing countries can share.

This is not to deny that difficulties will undoubtedly arise from the structural weakness of many developing countries' economies faced with tough international competition. This is why, for example, the Irish Presidency assured the ACP countries of the Community's wish to help them in using to the full the instruments of the Lomé Convention for the improvement of their competitive position. Where our developing country partners have genuine concerns, the Community is prepared to assist them to overcome concrete difficulties which may arise for them.

It is true that, as a member of the European Community and of the G24 OECD Group, Ireland is asked to contribute its fair share of the cost of aid to Eastern Europe. In line with the G24 approach to the provision of aid for Poland and Hungary whereby the allocation of multilateral funds would be supplemented by bilateral commitments, the Government decided to provide a special grant of economic aid of £650,000 for Poland and Hungary in 1990. I would emphasise that the Poland-Hungary funds constituted a special extra allocation and therefore did not involve a diversion of ODA funds. Our general policy in relation to bilateral assistance to Eastern Europe — this was stated just yesterday by the Minister in reply to a parliamentary question put down by Deputy Mary Flaherty — is that provision for Eastern Europe should not be made at the expense of developing countries. This year the Government allocated £100,000 from the disaster relief fund for disaster relief in Romania. Also in 1988 the Government made a special allocation from the same fund for disaster relief in Armenia which is part of the USSR, not a developing country and not, therefore, classified for development assistance under DSE rules. While normally such funds are used for developing countries, a disaster relief fund, which is not tied exclusively to developing countries, was the only source of funds available at that time to provide a quick response and that is what we have been doing. However, all Government expenditures have to be decided in the light of overall budgetary requirements and our own budgetary position is very much more constrained than that of the EC. It affects all allocations.

I agreed with some of the remarks made by Deputy Ferris this morning but not with others. I also wish to refer to a contribution he made to the confidence debate yesterday when he referred to a letter circulated to some people in Mayo referring to the Presidential election and which he stated was endorsed by me. The first knowledge I had of that letter was prior to taking the vote at approximately 7 p.m. last evening. I subsequently got a copy of the letter and discovered that while it was signed by an individual my name was typed at the end. I did not have any knowledge of the letter, was not consulted about it and, therefore, could not have endorsed it. Deputy Ferris also told me he got the letter from Deputy Garret FitzGerald. In view of the fact that Deputy Garret FitzGerald referred today in the Irish Independent to a letter and that the copy of the letter had a fax number, 09451833, a number of a well known Fine Gael activist, it appears to be true. I am afraid that Deputy FitzGerald's recollection of the letter, which he only got yesterday, and reported to the Irish Independent is faulty as it leaves out a phrase which would give a completely different aspect and context to the letter. It brings into sharp focus the question of his recollection of events in 1982.

Are we going back over the debate?

I reiterate that I knew nothing about that letter and did not endorse it. The decisions taken — and which will be taken in the future — will not impinge on the Community's desire to continue its contractual obligations to the developing world.

I want to refer to the Summit meeting earlier this week. In particular I want to refer to a report in the London Independent on the Summit because it has specific and clear implications for Irish military neutrality which is now at an end.

It seems that the Taoiseach has agreed that Irish military neutrality can and will come to an end; the only thing which has happened is that the Irish people have not been told that that commitment has been entered into. I want to quote from last Monday's edition of the London Independent:

monetary union represents nothing less than a final mandate for the treaty changing Intergovernmental Conference which opens on 14th December. The 11 signalled that equally explicit guidelines would be agreed in December for the parallel conference on political union due to open at the same time. Yesterday's text still made it clear that political union would employ the creation of common defence and foreign policies and extension of the Community competences, increased use of majority voting by Ministers and some new powers for the European Parliament. Britain noted reservations on all these points.

It is very clear from that report — and from other reports carried in this country and outside it — that defence and military commitments are now on the agenda and will be specifically on the agenda for the next meeting of the European Council on 14 December. If this is the case why has it not been discussed in the House or debated in the country? It has been swept under the carpet and people have been told that it is not happening. It is happening, discussions on the ending of Irish military neutrality are taking place in Europe and we are not being allowed discuss them here because it is pretended that it is not happening.

Read the Taoiseach's speech.

We are not being told it is happening and there is a pretence that it is not happening. The Minister of State has just advised me to read the Taoiseach's speech. I am drawing attention to this because the Taoiseach's speech glossed over this important issue although it is very clear that it has been specifically agreed that the issue will be on the agenda for 14 December.

It is time that this House and the country had a debate on our military neutrality so that we can understand the principles, if any, on which it is based and which can be departed from in certain circumstances. If neutrality is there it is not good enough that it can be departed from by stealth without as much as a by your leave to anyone in this House or the rest of the country and without any debate or discussion. There should be a debate and discussion and we should know precisely the terms of these discussions.

I do not have a principled stance in favour of neutrality. Somewhere inside me I would prefer if countries in general could be neutral but that is not the reality. It did not stop Hitler from marching into any of the neutral countries in Europe when neutrality was the order of the day. People think that somehow, because you are neutral, you can escape the terrible horrors when a war is unleashed. However, according to The Economist of 26 January 1952 the then Minister for External Affairs, Frank Aiken, said that partition affected Ireland's approach to all questions of external policy and Éamon de Valera's post war broadcast of 16 May 1945 makes it clear that partition was the reason for our neutrality during the Second World War. Those remarks are from an article I wrote in August 1986 for The Sunday Tribune.

The doyens of Irish neutrality often look to the late Seán McBride and others and say what great defenders of neutrality they were. In 1949 — I have it on file — Seán McBride, the then Minister for External Affairs, said exactly what Frank Aiken and Éamon de Valera said, that Ireland will become a full chartered member of NATO the day after partition ends. The only principle of Irish neutrality that has ever been put on the record is the one that we will not discuss our military neutrality while partition continues.

Because of changes, particularly in the last 20 years, this so-called principled position has become somewhat watered down but somehow military neutrality has been put on a pedestal as an untouchable subject which is not even to be discussed. If anybody suggests that we have a civilised debate on the subject, so that we can all hear the points for and against neutrality, his head is shot off. If you even ask for a debate you are accused of being a militarist. I cannot understand that, it is very sad that we have not yet debated the question of military neutrality and that it has not proved possible to have a civilised debate on the matter.

The late Dr. Seán McBride in 1950-51 as Minister for External Affairs tried to negotiate a bilateral defence agreement between this country and the United States. That is a matter of record. Let the great neutralists who uphold Dr. McBride — a fine contributor to public affairs in this country — as a great neutralist look at what he did as Minister for External Affairs when he had the practical responsibility for the conduct of Foreign Affairs for this country.

When it comes to providing for our neutrality, it makes me sick to hear the Labour Party and The Workers' Party talk about neutrality. There is something seriously wrong when a person must be totally in favour of military neutrality in order to become a member of a party. That is the sort of thing that went on in Eastern Europe. Is there not one member of either the Labour Party or The Workers' Party who has any doubts about our military neutrality? There are people in my party who do not want military neutrality and people who do. In every party, except the Labour Party or The Workers' Party, there are people like that. The Labour Party and The Workers' Party will not have any discussion on it, but they will force their members to look at military neutrality as a holy cow which cannot be discussed because it is politically advantageous for their parties to advocate this and to try to convince people that we are all militarists if we dare to hold a contrary view.

Some people talk about our proud history of military neutrality. I am not proud of the neutrality that kept us neutral while six million Jewish men, women and children were sent to their deaths in concentration camps. What proud recollection of military neutrality is that? To sit on the fence while thugs beat up an old lady is not neutrality, it is cowardice. There are circumstances in which we must make it clear that we will take our defence and military duties seriously. It is time we defined those circumstances.

I wrote in that article in August 1986 that it was time to stop the nonsense and look at all the alternatives available to Ireland, including the possibility of joining NATO, and I indicated that this alternative might not be a long term possibility since NATO might disappear. The Warsaw Pact is obviously finished, so one wonders will NATO continue. I also said that neutrality is not a principle which cannot be modified. It is a pragmatic stand having its origin in the question of partition. The advent of EC membership has diluted our stand in this regard. Our duties to the European Community will prevent Ireland observing the Fifth and Thirteenth Hague Conventions governing the procedures for neutral states during war time. That is a fact.

It is very clear that the European Community will discuss a defence community when it next meets on 14 December. If there is to be a European defence community we should be members and we should make no apologies for that. If the Community comes under attack we should defend it. How can we have a political and economic union and not have a Community we are prepared to defend if it is attacked? Do we expect Belgian or Dutch troops to defend our interests? It is time we made it clear that we will defend our own interests. We should not talk about military neutrality as if it is a sacred God. What about all the socialist parties in Europe who have no time for military neutrality, who have no difficulty in sitting around the table of NATO let alone a European defence community, who are often paraded through this House by the Labour Party as being great men? There is total and absolute nonsense and hypocrisy coming from the Socialist parties. If there is a European defence community we should be members of it. Let us debate it and point out why it is our responsibility to be there. I have an open mind in relation to NATO, which I think is on the way out but I think we should be members of a European defence community.

Sweden, Switzerland, Austria and Finland are seen as great neutral countries. Austria and Finland are not neutral by choice; they were compelled to be neutral by a former oppressive neighbour. Sweden and Switzerland are armed to the teeth or are exporting arms or machine parts to be used in destructive weaponry. There is no equation between neutrality and pacifism which seems to be the case being made. Let us be clear about it, the only reason for World War II was because Britain in particular and later the Allies were not equipped to stand up to Hitler. If someone geared up with weapons arrives on one's doorstep, one must be equipped to repel them. It was appeasement that caused World War II, not an opponent who was armed. We should get these things into perspective.

It is time we made it clear that partition is not the only principle of Irish military neutrality. We should make it clear that we are not going to just take what we can from the European Community but that we are prepared to take our duties seriously in defending the Community. People will say that when we went into the Community we did so on the basis of military neutrality. Let us put it to the people again and ask them, if there are to be new Community structures and a new defence community in Europe, will they take their responsibilities and join it or should we pull out. Surely the people are entitled to hear the arguments for and against. We should have a reasoned and logical debate. If there is a good reason to retain military neutrality I would like to hear it. I am open to being convinced by logic and reason but I will not be convinced by somebody trotting out the argument that it is a long established proud principle, but who will not allow people in their parties to express a contrary view. Nor will I be put down by people who suggest that one is a militarist because one agrees with joining a defence community. Look at all the militarists in the other neutral countries.

We do not provide for our military neutrality. In fact, it was estimated in the early eighties by a former Army Chief of Staff that at that time we would need to have provided in excess of £650 million to defend our neutrality, when our budget for the year for the Department of Defence, including pensions, was less than one third of that amount. Other neutral countries have huge armies to defend their neutrality and they export all sorts of weaponry. They are not pacifists. If somebody invaded my property in the morning and the gardaí were not capable of dealing with it, I would defend my property. That is my right and it would be my duty to my family. It is the same in the Community. If thugs threaten the Community the Community has a right to stand up to them. If somebody attacks the European Community we cannot sit here and continue to take what we can from the CAP, the Regional Funds and so on, and refuse to defend the Community. That would be a totally immature attitude.

The press have given the Labour Party and The Workers' Party too easy a ride on this. Let them spell out their neutrality objectives and their objections to a defence commitment to the European Community. Why have the press never asked them if members of their party are allowed to hold a contrary view? We know about parties who have a 100 per cent view — they are unreal, they do not exist.

Another reason there should be a debate on this issue is that if we do not set down the principles on which our neutrality is based — I am talking about military neutrality because politically and economically we are members of the western community of nations — presumably the principles can be departed from on the whim of the Taoiseach of the day, which is what we are in the process of doing here. We are about to depart from the principles of military neutrality on the whim of the Taoiseach without so much as a by your leave to anybody, any discussion or any reason being given in this House as to why that should happen.

The buzz term in Europe is the "democratic deficit". Most people who talk about the democratic deficit talk about the need for the European Parliament to be strengthened as part of the institutions of the European Community. I do not have any difficulty with that but in tandem with that there is a role for national Parliaments to be strengthened, there is a role for us. It is all right for the European Parliament to hold the Commission and members of the Council of Ministers accountable but individual members of the Council of Ministers and the European Council are members of the national Parliament and answer to the national Parliament. Both national and European Parliaments should be strengthened in this regard. When the question of the democratic deficit is being addressed we should not simply address the problem of the shortage of powers of the European Parliament. National Parliaments have a role in holding Governments accountable for their actions within Europe as well and that should not be lost sight of. This is a very important point which I want to see developed.

The Minister of State referred to the question of development aid. Given the very generous voluntary contributions made by the Irish people to tackle the problem of world hunger it is nothing short of a disgrace that not only have we not sought to reach the targets set by the UN for member states in regard to the percentage of our GNP which we contribute towards the solution of the problem of world hunger but that in recent years that percentage has regressed. There is a very strong case for omitting the budget for overseas aid from the cuts which have to be applied in Government Departments. World hunger is a desperate and shocking thing and, from a humane point of view, we should make a decision on an all party basis in this House to aim again at the UN target so that we can get up to the target of, I think, 0.1 of 1 per cent of GNP — I cannot remember the amount. We should aim for that target, stop regressing the contribution we make and increase it. The Irish people generally are way ahead of the Irish politicians in this regard.

The concept of economic and monetary union in the European Community is not new. The founding fathers of the Community back in the fifties had this in mind as an ultimate objective. It came to the forefront again in the seventies when Europe saw the need for a united and strong economic block to counter the competitive pressures from other sources. For a time there was a real prospect of major developments but the oil crisis of 1973 effectively ended progress as member states became more defensive in their policies in reacting to this crisis. At the end of the seventies the Community did, however, establish a monetary system which, after initial difficulties, has evolved into a zone of monetary stability. The European Monetary System, as it is termed, is now established on a solid foundation and it provides a good basis for further monetary integration. A major breakthrough was finally achieved after the mid-eighties and the Single Act has provided the right starting point and the right momentum for the successful evolution towards economic and monetary union.

At its meeting in Hanover in June 1988, the European Council decided to set up a committee under the Chairmanship of Commissioner President Delors with the task of studying and proposing concrete stages leading towards economic and monetary union. This committee reported in April 1989. It proposed a three-stage transition to full union as follows: Stage 1 to start on 1 July 1990 and to include stronger co-ordination of economic and monetary policies with full participation by all member currencies in the European Monetary System; Stage II — the transition stage — to take the process of integration significantly further by creating a central monetary institution to be known as the European System of Central Banks, by narrowing the fluctuation margins of currencies, some pooling of reserves, and the setting of basic economic targets, including rules for the size and financing of budget deficits; and Stage III — the final stage — to encompass the permanent linking of exchange rates and the transfer of responsibility for monetary policy to the European System of Central Banks and binding rules and procedures in the macro-economic and budgetary field.

The committee did not concern itself with arguing the case for union but it did emphasise that much closer and more effective co-ordination of economic policies between member states of the Community would be needed to achieve a successful and durable union.

The report of the Delors Committee was considered by the European Council at their meeting in Madrid in June 1988. The Council decided that the report provided a good basis for further work and that the first stage of the realisation of economic and monetary union would begin on 1 July 1990. They asked the competent Community bodies to adopt the provisions necessary for the launch of the first stage and to carry out preparatory work for the organisation of an Intergovernmental Conference to prepare for the subsequent stages. This work has been in progress since and it was decided at the Dublin Council meeting last June that the conference will begin in Rome in December.

Under our Presidency, earlier this year, the Council of Economic and Finance Ministers of the Community, adopted decisions designed to improve progressively the procedures for co-ordination of economic and monetary policy. These were: (1) a decision on the attainment of progressive convergence of economic performance during Stage I of union; and (2) a decision amending a decison of 1964 on co-operation between the Central Banks of the member states of the Community.

The first substantive discussion at ministerial level about the final stages of union took place at the meeting of Finance Ministers in Ashford Castle in March this year, again under the Irish Presidency. There was a considerable degree of consensus among Ministers about the general design and many of the individual aspects of the Delors package. Generally, it was recognised that there must be a high degree of centralisation in the monetary field with an independent and federally-structured central banking institution and appropriate democratic controls. While greater flexibility should be allowable in relation to budget and other economic policies, it was recognised that there will have to be some arrangements to ensure closer co-operation between member states on economic policies and proper budget discipline.

In the Delors report there is special recognition of the difficulties that economic and monetary union may present for the poorer and peripheral regions of the Community. While not making any specific proposals, it did acknowledge that Community policies in the regional and structural field would be necessary in order to promote the best allocation of resources and to spread the gains throughout the Community. It recommended that particular attention be paid to an effective Community policy aimed at narrowing regional and structural disparities and promoting a balanced development throughout the Community.

In the on-going discussions on closer integration, Ireland has consistently argued that adequate policies to promote economic and social cohesion are fundamental to the lasting success of economic and monetary union. Our contention is that the peripheral regions may fall behind unless appropriate counteracting measures are put in place and that these require to be supplemented by further action designed specifically to close the development gap between rich and poor regions. Such measures may require an increase in, and a broadening of, the Community budget in due course, so as to strengthen existing policies and develop new ones in support of cohesion.

Following the Ashford meeting, there have been continuing intensive discussions in preparation for the negotiations at the Intergovernmental Conference. These have culminated in the guidelines which last weekend's meeting of the European Council in Rome laid down for the conference. While the United Kingdom continues to oppose the principle of union, it has participated in a positive manner in the discussions and has put forward its own specific proposals, involving the development of a "hard Ecu" in the interests of achieving greater integration.

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