Donal Carey
Question:23 Mr. D. Carey asked the Minister for Finance if duty free sales will end in 1999; and if he will make a statement on the matter. [13827/99]
Other Questions. - Duty Free Sales.
The decision to end duty free sales for intra-Community travellers has been enacted into European law and is scheduled to come into effect on 30 June 1999. Any alteration in this arrangement would require a proposal, in the first instance from the EU Commission, and unanimous agreement at Council. To date, the Commission has not put forward such a proposal, nor has the unanimous agreement of Council on this issue been expressed. It is probable that this issue will be discussed again at the European Council in Cologne. Sales of duty free goods to passengers travelling to destinations outside the EU are not affected.
Why was time not provided to discuss this issue at the Berlin meeting? It seems it was not on the agenda. Duty free sales are an important source of employment in this country and, in my constituency, provide additional revenue which lowers the running costs of Shannon Airport. The issue is one of vital national interest.
Ireland has led the way in pushing forward this matter. For a long time we were the only country up front about it. In the past year other countries have come on side, particularly the major countries such as Germany and France. For example, at yesterday's ECOFIN meeting a request was made by France to have the matter debated again, but it was turned down. The matter was debated but the position remains the same. The German Chancellor, Mr. Schröder, who is the current President of Council, said it will be discussed at the Cologne summit next week by the Heads of Government. There is a negative attitude among Finance Ministers at ECOFIN towards the majority countries on this issue, as we discovered on many occasions. I led a debate on this matter in 1998 and since then more people have come on side. There will be a final opportunity next week in Cologne when the matter will be discussed by the Heads of State and we will certainly push to have the decision reversed, as we have done in the past.
It appears that the game is up on this issue. Assuming that is the case, will the Minister indicate if the Government has put in place any plans to minimise the effects in Ireland of the loss of duty free sales? As he knows, the KPMG report established that there was a threat to a considerable number of jobs and that many sales would be lost. Will the Minister indicate whether his or any other Department have plans in train to minimise the effects?
As the Deputy rightly points out, the Government commissioned the KPMG study which outlined the Irish position and we forwarded that to Europe. The difficulty has been that the Commission was against the idea of commissioning a report. When the Commission was asked by the Vienna Council to examine this matter, it stated, in its March report, that it would be prepared to consider requests from member states on any European measure that could be used to alleviate some of the difficulties, although the Commission continued with its hard-line approach that the decision had to stand. I am sure this matter will be discussed at the Cologne conference next week when both Germany and France intend to pursue it, and they are the major players.
Has the Minister made any proposals, particularly with regard to the position in Shannon, County Clare?
Our approach all along has been that we wanted the decision reversed. For obvious tactical reasons we did not want to show any weakness and that we would not consider anything other than a reversal of the decision. We will wait to see what will happen next week but we have always taken the line that we want the decision reversed.
The idea of duty free sales started in Shannon—
It was in Shannon, yes.
—in my constituency, and it has been of enormous benefit to the airport. Is it not a fact that Shannon Airport has suffered because of some ideological confusion in the mind of Fianna Fáil that the market must prevail. That is the reason the Minister was late in taking up the issue. He said he took up the issue in 1998 but that was only after many Finance Council meetings at which he ignored the problem. The problem was created the first day—
A question please, Deputy.
I put the question but I was expanding on it a little for the Minister's benefit. At the first meeting in—
The Minister will not have time to reply now.
I will sit down.
The Ceann Comhairle may not be aware, since he assumed his exalted position, that local elections will be held shortly.
I hope the Minister's party gets an answer in Clare.
The abolition of duty free sales has nothing to do with Fianna Fáil ideology or that of Fine Gael or Labour. This is a European issue and it has been well debated. As Minister for Finance, I have done more to have this decision reversed than any previous Minister.
The Minister changed tack. He opposed it at the outset.
Written Answers follow Adjournment Debate.