Pre-European Council: Statements

The extraordinary meeting of the European Council on Thursday and Friday will be an important one, with significant implications for the Union over the coming years. There will be only one main item for discussion, namely, the Union's budget for the period 2014 to 2020, which is called the multi-annual financial framework.

It is my view that as Heads of State and Government, we have an obligation to work to show the European people that we can come to agreement in a decisive way on such important matters. For my part I will participate to negotiate an outcome that is in Ireland's interests and in the interests of the Union as a whole. Agreement by the 27 member states on matters as fundamental as equipping the Union with the resources necessary to face into the next seven years is no small task. However, it also is a matter which will affect the Union's credibility. I am committed to being constructive and ambitious in the negotiations and discussions that will take place.

As of now, it remains unclear whether it will be possible to reach agreement this week. There can be little doubt that the positions adopted by member states remain a considerable distance apart. Further delays would not be in our best interests, either nationally or as incoming Presidency, and, speaking frankly, I do not see how further delay will either change the substance of what is involved or improve the political context in which agreement must be reached. The time for action is now.

In recent years Europe has battled an unprecedented economic crisis and we are not out of the woods yet, with a great deal of work to do if we are to build recovery and return to growth. This must remain our absolute priority. Protracted negotiations about the Union's budget risk seriously distracting us from this vital task and risk also the goodwill and spirit of co-operation needed for the Union to operate as it should. Ahead of this week's meeting, therefore, I call on all member states and the representatives of the key EU institutions concerned to show the flexibility and compromise necessary if agreement is to be found. With political goodwill, a deal can and should be found, allowing us to return our full attention to the stability, jobs and growth agenda that will be the priority for us as Presidency in the first half of next year.

As the House will recall, negotiations on the multi-annual financial framework, MFF, have been under way since the European Commission put forward proposals in June of last year, and they are highly complex. The MFF sets out to agree the resources we provide in common across the entire range of the Union's actions for a seven-year period. By assigning our resources, we are effectively prioritising our common actions, making hard choices and difficult decisions on the EU's actions right up to 2020. The amounts of money involved are significant. The original Commission proposal had expenditure exceeding €1,000 billion over the seven years but the negotiations also concern how we raise this money, how the EU assembles the money that it needs, how we can improve the quality of our spending and how rebates may be handled for individual member states. This must all be agreed by unanimity.

We are a Union of 27 - soon to be 28 - member states, and each state has its own appreciation of the Union's wider interest, as well as of the national interest. I need hardly say that these negotiations are taking place in an extremely difficult economic environment for the Union, the eurozone and for most member states. Governments across the EU are keenly aware of the need for EU investment to promote growth and jobs, and this need was given clear expression in the form of the Compact for Growth and Jobs adopted by the European Council in June this year. We see spending on agriculture and agribusiness as very much a part of this picture, and the Common Agricultural Policy, CAP, delivers 85% of what comes into this country from the European Union.

Governments are also equally aware of the need to ensure that scarce public resources provided by our hard-pressed taxpayers are wisely used. This is the political context in which we are operating across Europe. Since the Commission made its proposal in June 2011, the Polish, Danish and Cypriot Presidencies have taken the work forward, aiming to reduce the areas of disagreement between member states. Successive Presidencies have worked to develop the so-called negotiating box, the detailed draft conclusions which would outline the parameters of the EU's spending.

The European Council President, Mr. Van Rompuy, has taken ownership of the process and will attempt to broker a deal at this week's meeting. It will not be an easy task and, as I have said, there are deep divisions between the member states. Mr. Van Rompuy will have my full support over the coming days in his efforts to broker a fair solution which will equip the Union with an MFF that is capable of supporting the Union and its member states in facing the real challenges for the years ahead.

The House will recall that, as I have set out before, the Government wants a properly funded and properly functioning European Union. The EU's budget must have the right mix of priorities, a fair allocation of resources and, most importantly in our present circumstances, a focus on jobs and growth. The EU must, in short, have a budget that is fit for purpose. We broadly supported the Commission's original proposal and although there was room for improvement in detail, we thought it had the right overall balance. In particular, we thought it had the right starting point for negotiations on the size of the CAP. It will be no surprise to anyone in this House to hear that in the negotiation of the MFF, our overriding financial priority has been to protect the allocation for the CAP and to maximise Irish access to it. The CAP accounts for about 85% of our total EU receipts and it is a key element in our overall relationship with the EU.

The Union's budget needs a CAP allocation that will support a vigorous, consumer-focused agricultural production base in Europe. Some member states have called for a greater emphasis to be given to the non-agricultural elements of the MFF, arguing that these promote growth and implicitly suggesting that the CAP does not. We have argued that the CAP is a vital tool for economic growth, through its support for agriculture, agrifood and related industries and the rural economy. Europe must take advantage of growing global food demand that will only increase over the coming decades. That is obvious, given the growth in the global population and the capacity of Europe and Ireland, in particular, to produce more food from the resources we have. The original Commission proposal for CAP funding in the MFF was a good starting point, although this heading showed the most restraint. However, the direction of successive proposals has been to reduce its allocation still further, and we reject this approach. At the European Council, I will vigorously defend the CAP.

The importance to Ireland of a robust MFF is not limited to the CAP. We have argued strongly for an MFF with adequate resources for other key growth-enhancing measures. Our economies are changing and the kind of support and stimulus we need from the EU is also evolving. Critical areas of our economies such as research, education, improved connectivity and the important small and medium-sized enterprise sector must be supported by the next MFF. I will continue to argue this strongly, and I have presented a report to a Council meeting in this respect. The Commission responded with a range of initiatives regarding the development and protection of the small and medium enterprise sector. I know the Minister for Finance feels very strongly about this as he prepares his budget.

We want the budget to support the Europe 2020 strategy for jobs and growth, and it must have adequate funding for investment in economic growth and the creation of employment. All member states, including those with more developed regions, must be able to access EU programmes and funds. The scourge of youth unemployment is not limited to underdeveloped regions, as we know too well. The Union's cohesion policy must address the challenges that face us today, and the most serious of these is unemployment. I have made this point to my fellow Heads of State and Government both at the European level and in my bilateral contacts. This is a challenge that we cannot fail to address in the MFF.

It might be of interest to Deputies to know that I spoke to the Austrian Chancellor last week when I was returning from Budapest. I took the opportunity to visit with him a youth employment centre. In Austria, if young people decide to leave the main education stream, they are given a guarantee from the state for training and apprenticeship. The country has practically a zero rate of unemployment among young people, which is quite extraordinary. Some of the schemes parallel what we do with training in catering, for example. I know the Minister for Social Protection has spoken to her Austrian counterpart about that and I have seen some evidence of real opportunities in that respect.

CAP and Cohesion Funding make up the bulk of the MFF. Of course, the remaining elements are also valuable and necessary, and the Union must have sufficient funds to act outside its borders, most importantly in the area of development and humanitarian aid. We see such efforts every day.

Administration costs are necessary and underpin the important actions of the European Union. By international standards, the EU budget in this regard is not exceptional. However, I agree with those who argue that the Union's funding must reflect the consolidation efforts under way in member states and I have no doubt there is room for much greater efficiencies, including financial efficiency, in the funding of the administration heading. We have argued that the Union's administrative expenditure can be cut, just as member states have consolidated their budgets.

As I indicated, there are, without question, divisions among member states on the multi-annual financial framework. Some countries, mostly net contributors, have called for significant cuts to the Union's budget, while newer member states naturally want a greater emphasis to be placed on cohesion funding and a well funded EU budget. Prime Minister Gonzi of Malta, who visited Ireland last week, argues that the proposal regarding Cohesion Funds is too severe in respect of his small country which needs to protect the limited areas of land available. The Prime Minister of Hungary, Mr. Viktor Orbán, makes the point that his country has spent its Cohesion Funds on infrastructure and development and does not want reductions in the current allocation.

For the Commission and European Parliament, as well as some member states, a key issue is reforming the way in which we collect the revenue which provides the EU budget. Various reforms, such as relying on a financial transaction tax or a new VAT arrangement, have been put. For the most part, the Government is unconvinced by these arguments and continues to believe the current assessment based on a gross national income, GNI, key is the fairest, simplest and most transparent way to fund the European Union. The system of rebates is another highly contentious and sensitive issue for some member states.

The European Council President, Mr. Van Rompuy, recently put forward draft European Council conclusions containing a new negotiating box. These contain his compromise proposals which, I regret, go in a direction we cannot support. Mr. Van Rompuy has proposed further cuts to the overall budget that are deeper than those suggested by the Cypriot Presidency. He has proposed a 7% cut in the overall multi-annual financial framework amount compared to the original Commission proposals, including a cut of 6.5% to the Common Agricultural Policy.

It will not be easy for the European Council President, Mr. Van Rompuy, to reconcile member states' very different positions. Britain has taken a firm view on restraint in the EU budget, to the extent that there are fears that it will not be possible to secure a deal at this week's European Council meeting. If a deal is reached, it will then be necessary to obtain the assent of the European Parliament. The President of the Parliament, Mr. Martin Schulz, spoke about this issue on the floor of the Dáil some weeks ago. Ireland has repeatedly stressed the importance of any European Council deal on the multi-annual financial framework being acceptable to the European Parliament in which there are also different views. As Deputies will recall from the recent visit of the European Parliament President, Mr. Schulz, the European Parliament is fully engaged with the process and very clear on the outcomes it expects.

We must be realistic; there is a real possibility that this week's summit will not reach a deal. If so, it will have a great impact on Ireland's Presidency agenda for the first half of 2013. The Irish Presidency will in any case have responsibility for chairing discussions on a range of sectoral regulations underpinning the multi-annual financial, including Horizon 2020 and reform of the Common Agricultural Policy, and negotiating their passage through the European Parliament. This would be greatly complicated if a multi-annual financial framework were not agreed. We do not want a failed summit as it would have severe implications for the reputation of the European Union and the citizens of its member states. At the same time, we do not want a deal which isolates any member state as this too would have serious consequences for the future of the Union.

An active and delicate process of negotiation is now under way. Ahead of the meeting proper, European Council President, Mr. Van Rompuy, will have a brief meeting with each Head of State or Government to ensure he has a full appreciation of the position of each member state. I will meet the president tomorrow morning when I expect to give him a clear indication of our priorities. Negotiations will get under way later in the day with plenary meetings, bilateral sessions and various break-out arrangements through Thursday evening and Friday. There is no scheduled finish time and I expect Heads of State or Government to continue until we have reached a compromise or it becomes clear that none is possible on this occasion. The latter outcome is a distinct possibility.

While this week's meeting of leaders will be firmly focused on the conclusion of the multi-annual financial framework, one other matter has also been flagged for consideration. This is the filling of a vacancy on the executive board of the European Central Bank, ECB. There has been a vacancy on the executive board since the beginning of June. In line with the procedure set down in the EU treaties, the Council made a recommendation for the filling of this vacancy in which it proposed Mr. Yves Mersch of Luxembourg. The European Parliament was consulted on this proposal, as provided for in the treaties, and offered a negative opinion on the grounds that a better gender balance was required on the board. During the European Parliament hearings, there was full recognition that Mr. Mersch is a person of recognised standing and professional experience, these being the requirements for the position, as set out clearly in the treaties. It had been proposed that the European Council would consider the matter of the filling of this vacancy on the ECB's executive board through a written procedure earlier this month. However, as there was no consensus among member states to use this procedure, the decision now comes on to the agenda of this week's meeting of the European Council. I expect this matter, which will be decided upon by qualified majority, to be finalised this week.

As I noted, this is an important meeting for the European Union which I hope will have a positive outcome. I look forward to playing, on behalf of the country, a full, active and constructive part in the discussions and I hope they will be brought to a conclusion this week.

This week's European summit is focused on the topic of the European Union budget. It is taking place at a time when many other issues are in danger of slipping back into crisis and further significant damage is being done to the Union and its member states. The summit's backdrop is one of deepening division and a real threat that the Union will lose a member state. The facts are enough to cause despair to anyone who cares about the European Union and believes it is essential for growth and stability in Europe. As matters stand, the budget that is likely to emerge will be entirely insufficient to address the urgent needs of the Union and nothing will be done to rescue the banking proposals agreed in principle in June but which are quickly unravelling.

In the case of Ireland's position, this is a summit which aptly sums up the Government's approach to Europe, which is one of not having a policy. Regardless of how many fundamental issues come up for discussion, the Taoiseach and Tánaiste refuse absolutely to set out exactly what are Ireland's views. Many generalities and tough words are not a replacement for a real policy. This is different from the policy of previous Governments in the past four decades.

With an accelerated reform programme due to be agreed in months, Ireland still does not have a stated policy on what it wants to emerge. Other than engaging in banal generalities, the Government has not outlined a substantive policy on the budget. Its only impact on negotiations on banking has been to demand that nothing be agreed that may involve a treaty change. On bank related debt, its public statements keep changing and it has failed to state what it is seeking. While the Taoiseach and Tánaiste mention Europe in many speeches, there is nothing which even remotely approaches a policy.

In the Dáil, the Taoiseach and Tánaiste refuse to outline the detailed substance of their policy or give proper answers to questions. This is in stark contrast to the behaviour of governments in other countries which have issued detailed statements on their policy positions and obtained clear mandates from their respective parliaments in advance of negotiations. The issues are too serious for this opt-out policy to continue. The citizens of Europe want a Union which is actively engaged in the work of creating jobs and helping those most in need. However, the European Union does not have anywhere near the type of funding it requires to even begin to address the demands of its citizens.

As usual, the Common Agricultural Policy is under attack. The CAP has been one of the great achievements of the European Union, having brought food security to a Continent which regularly experienced the opposite and provided some protection for rural life, which would be otherwise unsustainable. It is also a fundamental part of the deal to which member states signed up when they joined the European Union. The complete opening of markets was based on having a Common Agricultural Policy sufficiently large to counteract the natural movement to larger and larger production concentrated in fewer locations. A failure to protect the CAP would be a major breach of faith and must be opposed.

A failure to ensure that the interests of all farmers are protected would be just as bad. It is time for the Government to represent all farmers. Thankfully, the French Government has been active in defending the Common Agricultural Policy, which has made up for the complete failure of our Government to undertake any serious initiative on this or other budgetary measures.

Those who are seeking new innovation and structural funding are right. The European Union can and should play a more prominent role in building competitiveness and helping poorer regions. However, this cannot be done by gutting other policies in the context of a decreasing overall budget. The Union is being squeezed into a zero sum game. If the budget proposed by the European Council President, Mr. Van Rompuy, is agreed or if there is a further reduction, many essential programmes will begin to be gutted and the Union will not respond to its greatest crisis.

The EU is wasteful in many respects but it is a nonsense to believe that tackling waste will transform its budget. The overwhelming bulk of EU spending is done in co-operation with national governments. It is mainly weaknesses in national systems that have led to queries from the Court of Auditors. The Union's system of checks is more rigorous than that prevailing in most countries.

Undoubtedly, the administrative budget should reflect the pressures every government in Europe is facing. Cuts will be required, but they will be no more than a token. The administrative budget of the Union is only 6% of the total. Even halving it would not make a significant contribution to expanding other programmes. Like straight bananas, monstrous European bureaucracy is a eurosceptic mantra that is nothing more than a distraction from the real business at hand.

The negotiations on the budget have been ongoing for most of this year. Nearly every member state has been actively participating in the process. Some 24 of 27 member states have participated in loose groupings to advocate general policies. Ministers and Prime Ministers have attended sessions where they have co-ordinated their approaches to the largest decisions. For example, 14 countries have formed the "Friends of Cohesion" group to push for the protection of regional aid. It is almost incredible that the Taoiseach and Tánaiste chose to opt out of these discussions. We are one of only three countries not to be involved in this year's bilateral and multilateral discussions on the budget. The reason for this is unclear. In other areas the Government has clearly been scared to take a position in case someone would object but this cannot have been the case in respect of the budget. Nor is it because it would have interfered with other activity, as the Taoiseach has kept his meetings with leaders to a level below that of any of his predecessors since joining the Union.

Undoubtedly, the press releases are ready to be issued at the end of the summit claiming that the Taoiseach heroically saved the CAP. His formal statement at the opening of the summit will be spun as a decisive intervention. In truth, he will have timidly sat on the sidelines hoping that France will get the job done. Even at this stage-----

Deputy Martin did not turn up at meetings while he was in government.

I certainly did.

The Deputy did not. That is what officials in Europe report.

Our record was the sixth best out of all member states.

The past decade under Fianna Fáil was the worst ever for attendance at meetings.

That is factually incorrect.

It will be a long time yet before Deputy Dara Murphy becomes his party's leader. I would appreciate it if he would allow me the opportunity to contribute to this debate.

It is what European officials say about Fianna Fáil Ministers.

The Deputy should not make factually wrong contributions. Detailed studies by political science universities around Europe belie the untruth that he has articulated.

Even at this stage it is not too late for the Taoiseach to speak up on the worrying developments concerning the position of the British Government led by Prime Minister David Cameron. The leaked reports of proposals to get around a British veto through adopting annual budgets will not work and will merely accelerate the day when the crisis with Britain reaches the point of no return. That Prime Minister Cameron is now considering a proposal for a referendum on membership is a cause of alarm.

I spoke with him yesterday. He has no intention of leaving the European Union.

Did he indicate whether he would hold a referendum before the next general election?

No, but he said that he wanted to be quite reasonable in the discussions-----

-----and that he had no intention of Britain leaving the Union.

We shall see. The Taoiseach is aware of the vote some weeks ago in the British Parliament.

The British Government has been selective in much of its European policy, yet it remains a vital member of the Union. Its departure would be disastrous for the Union and itself. The damage to Ireland could be immense. An initiative is required to stop events going too far and to re-engage the British Government in Europe. Despite the Taoiseach's comments, Britain opted out of the fiscal treaty after the negotiations on it on and keeping the Union together did not succeed.

The Deputy should give me his suggestions.

In June, the leaders agreed what the Taoiseach called a game change for the economic crisis. Central to this was a banking union that was to start operation with a single supervisory mechanism on 1 January. Two summits later and the agreement is unravelling. A proper banking union is vital. Without one, a properly functioning financial system will not be restored to the eurozone.

In the past five months, the proposal has been continually watered down at ministerial level. The start date for the new supervisory system has been abandoned. There has been no progress in agreeing which banks will be under the system. Of concern is the fact that there are now signs that there will be no cross-eurozone deposit insurance fund or bank resolution regime. The most that appears to be under discussion is a co-ordination of national policies in this area.

Last week's meeting of finance Ministers ended in a general tone of despair. All movement was backwards. What has yet to be explained is the position of the Irish Government in those discussions. It has been reported by the Financial Times that some countries were proposing a quite ambitious approach to creating the banking union, part of which potentially involved a treaty change. It was in this context that the Government apparently made its only significant contribution. According to the account given by the Financial Times, Ireland led opposition to anything that would require a treaty change. It appears that our only policy is that, whatever is agreed, we do not want to need to ask the people's permission.

This is exactly the same approach that was taken to the fiscal treaty, resulting in a treaty that left a large number of issues unaddressed because of our Government's obsession with trying to avoid a referendum.

That account is wrong.

Even that limited objective was not achieved. Ireland needs a banking union to be established as soon as possible. The Taoiseach should use the upcoming meeting to call for the negotiations to be restarted and taken out of the hands of the finance Ministers.

Five months after the game change on bank-related debt, this progress also appears to be under threat. As no advance work was done before the June agreement, the June communiqué contained a general principle and nothing more. It was merely an opportunistic grab for a couple of sentences to be hurriedly cobbled together and attached to an Italian and Spanish deal. The Government has never stated what exactly it is looking for in these negotiations beyond the general idea of retrospective help. What do we define as "debt sustainability"? Are we seeking to sell our bank stakes to the European Stability Mechanism, ESM, and for what price? Are we trying to convert or lengthen the period of the promissory notes?

In explaining the game change, the Taoiseach, Tánaiste and Minister for Finance stated that the key was the availability of the ESM to refinance bank-related debt. Victory was declared on this basis. In the past week, however, it has emerged that we may no longer be seeking ESM money for this purpose. In July, the Minister for Finance, Deputy Noonan, explained to the international media that the availability of ESM funding for direct recapitalisation of banks was the objective. He stated: "Now that the rules have changed in Europe we want to retrospectively avail of the new regime". In October, he stated that the June agreement "implicitly paved the way for the ESM to recapitalise Irish banks for legacy debt".

In spite of constant requests from my party colleagues and me, no member of the Government would explain what exactly was being sought. The reason for this began to emerge last month when the head of the EMS, Mr. Klaus Regling, stated that legacy debt "has not been discussed in any European body". While our Government was claiming that it was doing everything possible and was confident of progress, nothing of the sort was happening.

Chancellor Merkel's initial comments on this matter last month were papered over after a panicked Sunday night telephone call from the Taoiseach. Since then, a number of senior German policy makers, including the president of the Bundesbank, have stated that these debts should remain a national responsibility. Last week, the Minister, Deputy Noonan, stated that having the ESM own large parts of our banking system might not be the best approach after all. The only clear point is that the Government is appealing to the ECB to give a "statement of intent" that the latter will do something at some point about the promissory notes.

In light of the extent of what German officials have called the Taoiseach's spinning about the agreement last June, he owes it to the people of this country to stop the mumbling about what is happening and explain exactly what it is we are seeking.

We are about to have a few weeks of budget announcements and the first thing should be the Taoiseach or one of his Ministers giving a clear answer to the basic question of what must happen to bank related debt in order to achieve debt sustainability. It is the Taoiseach's duty to the Irish people to be honest and explain what he is seeking.

The Taoiseach indicated earlier in the week that the summit will also address the serious situation in Gaza and the conflict involving Gaza and Israel. Every day people see new and alarming reports about the escalating conflict and they are genuinely shocked by the nature of the attacks on the civilian population in Gaza and likewise the meaningless and unacceptable rocket attacks on Israel, which are affecting human life there. There is no justification for the attacks on the civilian population and too many families and too many young children have died. An urgent ceasefire is required. The force being used is entirely disproportionate. It is important the European Union takes a strong stance in regard to what is happening. In particular, I ask the Taoiseach to carry the Irish voice in terms of an unequivocal condemnation of the deaths incurred by the civilian population, which are absolutely unacceptable. I further suggest that consideration be given to the participation of an international force to seek compliance with any ceasefire that emerges so that we avoid a continuation of the cycle of destruction which has gone on for far too long. We need more proactive interventions by the European Union in that regard.

I understand this week's EU summit will be focused on the seven-year EU budget, beginning from 2014. I listened very carefully to what the Taoiseach said on this but before dealing with this issue, I want to ask him to raise the issue of the ongoing violence in the Middle East as an urgent issue and to use his good offices to get an EU intervention. Le blianta beaga anuas, theip ar an phobal idirnáisiúnta cuidiú a thabhairt chun an choimhlint seo a stopadh.

By last night, approximately 130 Palestinian and five Israeli citizens had been killed. Half of those killed in Gaza were women and children. The European Council should not meet without the Taoiseach using Ireland's special status and its experience of our peace process to raise the urgent need for peace in the Middle East. There needs to be an immediate end of armed actions by all the combatant groups. The rocket attacks on Israel should stop and the Israeli bombardment of the Gaza Strip should end immediately, but in the meantime there is an onus on the international community, especially the EU and in particular the Irish Government, to act in a decisive way now before the situation gets worse. The Taoiseach can play a leadership role in this.

It is also vital we are not distracted by unbalanced media reporting that presents this conflict as one between equals, which it is not. I spent a few days in Gaza. The Gaza Strip is a Third World region. It is poor, has been under economic siege for six years and most of its citizens live in poverty and rely on international aid. The Palestinian people have been robbed of their land, imprisoned into ghettoes by separation walls and borders, and have little power or influence.

A UN report before this recent violence stated that by 2020, there will be virtually no reliable access to safe drinking water and no reliable electricity for the people of the Gaza Strip. Some 80% of the citizens there are totally dependent on international aid and more than one million are refugees. Israel, by comparison, is a first world, highly developed, rich and heavily armed super-state with nuclear weapons.

The international experience, and the main lessons from the Irish peace process, are clear. Refusing to engage in dialogue, demonising opponents, treating them as non-citizens, stripping them of their rights, entitlements, self-esteem and integrity as human beings, and engaging in censorship and vilification makes war inevitable and peace more difficult to achieve. It is clear from our experience as a people that real peace, and the process, must be inclusive, based on dialogue and equality, and all sides must respect the right of citizens to elect or select their representatives.

I ask the Taoiseach to ensure this issue is considered by EU leaders at this summit. The Government should also use its influence and its new membership of the UN Human Rights Council to raise the current hostilities, the denial of sovereign as well as human rights to the Palestinian people and the six-year illegal blockade of Gaza by the Israeli Government.

In respect of the proposals to cut the EU budget, Sinn Féin believes that where there are areas of waste in the EU budget, they need to be tackled and eradicated. However, we believe that EU leaders should be looking at ways to redirect the funds available into infrastructural and job creation programmes. Sinn Féin is opposed to reductions in the EU budget which would result in cuts to farm payments, cuts to investment in much needed infrastructure, cuts to training funds for the unemployed and cuts to investment in innovation. It is essential the Taoiseach demands that money from the EU budget is ring-fenced for jobs and growth. We need to go beyond the rhetoric on this issue.

One of the vital aspects for Ireland, by which I mean the entire island of Ireland and not just this State, of the new EU budget will be its impact on farming and the agrifood sector. Tá na hearnálacha seo chomh tábhachtach do eacnamaíocht na hÉireann. The Government needs to get the best CAP deal possible because a prosperous agrifood sector, which is the fastest growing sector of our economy, can play a significant part in economic recovery across the island. We need to get serious about protecting our agrifood sector and a healthy CAP is the way to go about this. We also need to move towards a more equitable system of farm payments that would keep struggling farm families on the land.

The Government came back to the Dáil in June trumpeting a deal on legacy bank debt by October. October has come and gone and we are as far away as ever from a deal on our legacy bank debt. The Taoiseach also told us that he did not raise the issue of the bank debt during his recent meeting with Angela Merkel on 1 November. That was a mistake. The State's debt-to-GDP ratio is due to peak at more than 120% of GDP in 2013. By that stage one in every five euros raised in tax will be going to pay off interest on this debt. Approximately 40% of this debt is bad banking debt which the Taoiseach's Government and Fianna Fáil placed on the shoulders of Irish citizens. It is not sustainable and we cannot pay it, so it needs to be removed. This will only be achieved if the Government faces up to this issue. If we are to get a deal on Ireland's bank debt, the Taoiseach needs to change tack and start standing up for Ireland's interests at these summits.

There appears to be an ongoing dispute between the IMF and the EU over how to bring debt levels in Greece under control. For two weeks now EU Finance Ministers and international officials have failed to reach agreement on this issue. This continuing uncertainty - the Taoiseach reflected this in his remarks - added to by the downgrading of France by Moody's rating agency, does nothing to restore confidence in European leaders' ability to deal with the debt crisis.

We wish the Taoiseach luck but he will need more than luck. The Taoiseach will need to show leadership, raise the essential issue of the conflict in the Middle East and stand up for our interests in these other matters.

I also wish the Taoiseach well in the clearly difficult negotiations he faces. In his speech he said we must be realistic and that there is a real possibility that this week's summit will not reach a deal. He went on to say that we do not want a failed summit as this would have serious implications for the Union's reputation and that we do not want a deal which isolates any member state as again this would have implications. An active and a delicate process of negotiation is now under way.

We want to see a deal but we do not want one which will not work and will not deliver Europe from the current crisis.

Many people are losing their homes and many have seen their incomes cut. It is a crisis that is allowing children to go to bed hungry. There is a huge responsibility on all the leaders in Europe to secure a deal that will work for the people of Europe. This is not just about reputations. It must be about delivering for the people in the EU.

A delay in agreeing the 2014-20 EU budget would also be worrying due to its impact on discussions to agree adequate cohesion policy funding. One area this would affect is the future of cross-Border INTERREG programmes. There is serious concern about a suggestion that any future PEACE funding would be deducted from the financial package received by the Irish and British Governments to fund various existing EU programmes. While the British Government is determined to cut the EU budget and would probably welcome this development, the Government must be firm in its demand that PEACE programmes be fully funded directly from Europe as stand-alone projects.

It is hoped that a seven-year budget of €1 trillion will be agreed at this EU summit. Right wing and right leaning governments throughout Europe are demanding a freeze or reduction in EU spending, but this will only lead to more austerity, which will increase the suffering for millions of middle and low income earners in Europe. There is waste in the EU budget that could be cut. It has been suggested that we should consider addressing the scandalous amount of money the EU spends moving the European Parliament between Brussels and Strasbourg every month, although it would probably be difficult to get agreement on that. Why not cut the outrageous salaries paid to higher level bureaucrats? Rather than let people in Europe go hungry, the EU could make savings by decreasing the militarisation of the EU through the Common Security and Defence Policy. The EU must reduce the bloated budgets allocated in these wasteful programmes.

Again, however, it is about choices. The EU should not reduce the budget by attacking social spending and investment in much needed infrastructural and job creation programmes. We need to see people securing employment and getting back into the workplace. The most clearly visible crisis on the horizon for the EU is youth unemployment. The shattered confidence, broken employment records and lost skills will blight the European economy for far longer than most commentaries appear to believe. Youth unemployment represents the biggest waste of potential in the EU. The average rate in 2011 was 21.4%, up from 15.7% in 2007. Some 30% of our young people are unemployed, and thousands more have left Ireland due to the youth unemployment crisis. Youth unemployment is 50% and 52% in Greece and Spain, respectively.

We have been told for months that the EU is prioritising youth unemployment and that it will be the focus of the Irish Presidency. I look forward to that development. In December, the European Commission will produce its proposals for a youth guarantee. It sounds great but there are no details available yet and no indication of how it will be funded. Sinn Féin will examine the proposals but we are not overly optimistic that they will be sufficiently ambitious. The EU could find €100 billion overnight for Spanish banks but it has not pledged anything for youth unemployment. Linking a guarantee to the next round of EU funding means a wait until at least 2014, and all indications suggest a cut, or at least no increase, in the EU budget, which means some other area of funding will have to be cut. There must be an ambitious plan of investment to tackle this major problem, and funding from the EU budget must reflect the seriousness of the problem.

I realise the discussions will focus primarily on the EU budget but I urge the Taoiseach not to shy away from the tragedy that has unfolded in Gaza. Like most Irish people, I am angry at times and at other times extremely upset. Anybody who looks at social media and at some of the pictures of what is happening in that region would have to be made from stone not to be moved. More than 130 Palestinians have died in Gaza since Israel's latest attack on the Gaza Strip on 14 November. The majority were civilians and more than 20 were children. Five Israelis have also died. As I have said to the Tánaiste, the EU must be made to realise that it has a vital role in bringing peace to that region. As other speakers have said, these are not two equal sides fighting. One side is the most well-financed military in the world with the most modern weapons, while the other side belongs to a besieged colonised people living under an illegal blockade which has created the socioeconomic problems that have made them among the poorest in the world. There is a crisis in the region and we must act. We should act on the blockade. The Irish Government must take a lead on this and show leadership in Europe on it.

I understand that Deputies Mick Wallace, Seamus Healy, Shane Ross and Richard Boyd Barrett are sharing time.

If the citizens of Europe were asked today if they thought they are being treated in a fair manner by governments in Europe, I believe a large majority would say "No". If they were asked if they thought the Palestinians were being treated fairly by the international community, the answer would be the same.

The launch of this latest attack on a defenceless civilian society should be of great concern to anybody who is concerned about international law and humanitarian law. A diplomatic alternative existed in this situation. Hamas had agreed to an informal truce but a peaceful alternative appears to have been rebuffed. Western media have ignored this and, instead, we receive a misleading presentation of the issue from President Obama. His defence of Israel's behaviour in the last week is nothing short of a disgrace. The imminence of the Israeli elections is clearly a big factor. Spilling the blood of children in the interests of electoral gain is nothing new on the planet but, sadly, there is a huge silence from the international community.

With regard to fairness, today's Financial Times points out that in military terms the conflict between Israel and the Islamist Hamas movement could not be more unequal. Examining the sequence of events over the past month shows that Israel played a decisive role in the military escalation - the killing of 15 Palestinian fighters in October, the shooting of a mentally disabled Palestinian in early November, the killing of a 13 year old during an Israeli incursion and, crucially, the assassination of the Hamas commander, Ahmed Jabari, last Wednesday during negotiations on a temporary truce. After six days of sustained assault by the world's fourth largest military power on one of its most wretched and overcrowded territories, more than 130 Palestinians have been killed, half of them estimated to be civilians, as well as five Israelis. That is more than 25 to one in terms of deaths. In the past eight and a half years, when rockets were fired from Gaza to Israel, a total of 28 people, including the five last week, have been killed. There is no comparison. It is mind-boggling to consider that a rocket from Palestine costs approximately €300 while the ones coming from Israel cost €47,000.

The issue is not just about who started and escalated the conflict. The portrayal of Israel as some type of victim with every right to defend itself from attack from outside its borders is a grotesque inversion of reality.

Israel has been in illegal occupation for the past 45 years of the West Bank and Gaza, where most of the population are the families of refugees driven out in 1948 of what is now Israel. The interior minister, Eli Yishai, insisted Gaza needs to be sent back to the Middle Ages.

This item is not for discussion in the pre-European Council meeting.

The Taoiseach said he would raise the issue with other EU heads of Government in the coming two days. The desire to deprive people of infrastructure has a genocidal edge to it. This is something our Government should not put up with and we should raise our voice about it. The US, Britain and other European powers finance, arm and back Israel's occupation, including the siege of Gaza, to the hilt. It is not Palestinian rockets that stop Israel lifting the blockade, dismantling its illegal settlements or withdrawing from the West Bank and Gaza; it is the unconditional US and Western support that gives Israel impunity. If Europe continues to back Israel 100%, we will not see a change. The international community must take some responsibility for what is happening in Gaza. It must question the level of violence Israel is implementing. They said they made a mistake in picking the house where they killed 12 civilians but it is clear they are picking houses where civilians live. A Palestinian woman said yesterday that they have nowhere to take their children because they have no bunkers. She said that the Israelis are scared but the Palestinians are dying and there is a massive difference. Any long-term settlement and any truce to be discussed must involve a plan to end Israeli occupation of the area.

In the Taoiseach's contribution to the debate, he spoke eloquently of economic growth, job creation and tackling youth unemployment. Those statements ring hollow in the current climate in this country, particularly when we examine the mid-term fiscal statement published by the Government on 13 November, which indicated the Government had accepted the failure of its job creation proposals and targets. The target of 102,000 additional jobs by 2015 was reduced to 67,000 in April and to 18,000 additional jobs on 13 November. The CSO shows that in the year to the end of June 2012 there has been a net reduction of 34,000 jobs. This is the current situation and the Taoiseach's statement rings hollow.

Unemployment arises because of the Government's embrace of austerity, its cuts to services, its increased taxation and because it is paying the private debts of other people, which are not ours. I believe, as the Acting Chairman, Deputy Mathews, has said, that it is time to stop being the best boy in the class and to play hardball with the European Union. The conduct of the last Government, composed of Fianna Fáil and the Green Party, and the continued situation of this Government, with Fine Gael and Labour, means we have lost sovereignty. In the words of James Connolly, the reconquest of Ireland must be started now. The Irish people must take back their sovereignty. Three things need to be done to begin the process. The first is to stop all payments of the outstanding €36 billion in bonds held by Irish banks. We need to stop the payment of promissory notes and to stop the three card trick we had last March where we effectively borrowed the money to pay off the promissory note. We also need to freeze payments to the ESM as we have been told the instrument will only deal with future situations. I understand we are to pay €254 million to the fund shortly. Ireland is being humiliated in the EU. Greece has received a write-down of €100 billion and we also need a write-down of debt.

There is a wonderful musical at the Bord Gáis Energy Theatre called "Anglo: The Musical". It sums up the problem of Ireland, its relationship with Europe and a possible solution far better than the Taoiseach's speech. There is not much point in the Taoiseach saying the only item on the agenda is the multi-annual budget. That is not the only item on the agenda of Europe today. The only items are debt, debt and debt. To go to Europe and suggest we are not going to raise this vital problem is unrealistic and being in denial. The Government likes, as Deputy Seamus Healy said, to be congratulated, applauded, wined and dined and told how wonderful it is. The one big problem, which is shown in the musical, is how to tackle the debt. There are no proposals for that on the agenda. In a revealing sentence, the Taoiseach said that when this is out of the way, we will be allowed to return our full attention to the stability jobs and growth agenda that will be the priority when we take over the Presidency. These items should be top of the list. Have they been put to one side so there is concentration on the little diversion of the multi-annual budget?

As a curtain raiser for the Presidency, we need a declaration that the nonsense of coming before the House and saying we must look after Europe as equals and that we will be impartial in the Presidency should be discarded. Let us resolve that the Presidency will be used for Ireland and that the Presidency will give us the leverage to do what we need to do. Everyone knows that write-down of debt is essential. It is not sustainable in the shape it is in at the moment. Let us use the Presidency to put at the top of every agenda the write-down of debt. Let us give notice to the European Union, tonight and tomorrow, that the budget can be discussed but we intend to regard the Anglo Irish Bank promissory notes on 31 March as a priority.

The musical portrays us as perceived lapdogs. I am not one for knocking the Taoiseach or the Tánaiste abroad but the musical has the message that we did not all party. Some people did, some people did not and some did not like what was happening. The other question was where the money came from and the simplistic message was that it came from German banks. The third telling and disappointing image was that one of the puppets was Angela Merkel, who had a dog on the lead. The dog was the Taoiseach, which is symbolic of the fact that we are becoming subservient. We are the dogs who do not bark when we go to Europe and face the powers of Europe.

Deputy Ross brought his own audience with him.

Let us resolve to go to Europe and, at every occasion during the Presidency, bark and warn them that we will not be trifled with and that we will park the promissory notes, whether they like it or not, on 31 March. We are giving them a warning now so that we can re-negotiate a real deal on debt, not just on the multi-annual budget.

I want to raise two points, both of which require the Government to develop spine and backbone to speak up for the citizens of the country and citizens elsewhere who are suffering because of the failed policies of the European Union and the failed policies of the major Western powers. The Tánaiste has done everything to demonstrate to Europe that we are the best boys, that we will obey diktats and inflict the most cruel and unjust austerity our citizens.

In return for doing that the Government has got nothing from them. They must be laughing up their sleeves at us. The more we submit to their diktats and accept this cruelly unjust policy of loading the debts of bankers and speculators onto the backs of working people and the vulnerable sectors of our society, the more they keep ramming this injustice and austerity down our throats. The people cannot take any more.

People are demonstrating on the streets today about disability and special needs services. People were on the streets yesterday demonstrating about cuts to services to the elderly. Tens of thousands of people will be on the streets on Saturday next to protest against all the cuts that are being imposed on working people, the unemployed and the vulnerable.

Austerity is not working. The pain is too great. We need to show a bit of backbone. We need to say we are not paying their debts any longer and that we are not paying €9 billion in interest on debts next year. If we did that we would not have a deficit of €15 billion. We would have a deficit of €6 billion and we could fix that by taxing wealth, the corporations and the elites, and get our economy back on track. That is what I suggest we say to them.

What is happening in Gaza? It is depressing in the extreme to hear the Tánaiste recycle the lies of the Israeli Government in explaining how this conflict took off. The Tánaiste referred to the latest round of violence which, he said, was triggered by sustained rocket attacks on towns in Israel. It was not triggered by sustained rocket attacks on Israel. It was triggered on 8 November when a 13 year old Palestinian boy, Ahmad Abu Daqqa was playing football in the fields of Gaza and was killed by the Israelis. That triggered a response. Even after this a truce was agreed by Hamas on 12 November. That truce was broken when Israel launched an attack on 14 November. This is a cynical move by the Israeli Government to get votes in the forthcoming election by killing Palestinians. That is not acceptable.

When are we going to speak up against the rogue state that is Israel and which is crushing the Palestinian people with a siege and with constant military incursions, persecution and oppression?

While the Tánaiste may not accept my view on this I have a letter from the deputy speaker of the Gaza Legislative Council, Dr. Ahmad Bahar. He is asking that a delegation from the Gaza Legislative Council would come to this Parliament between 20 and 24 January next. Would the Government agree to allow a delegation come here so that we can hear the other side of the story, which the world is not hearing, from the elected representatives of the people of Gaza?

Deputy Ross says the Taoiseach should go to the European Council meeting on Thursday and bark. The problem with Deputy Ross's approach to this issue is that it is all bark and no brain.

Let us start with what the meeting on Thursday and Friday is about. This is a special meeting of the European Council. It is not about the issues that have preoccupied the European Council over the course of the past year, which are bank debt, the euro and so on. This special meeting of the European Council is to deal with the European budget between 2014 and 2020. What are we talking about when we talk about the European budget? We are talking about a total of €1,000 billion of European money from which this country stands to gain a considerable amount in the areas of agriculture, research, education and training, communications and a range of other areas all of which are vital in growing, developing and promoting our economy. To suggest that we should approach that meeting in the way Deputy Ross outlines, using all of his elaborate and entertaining analogies, is daft. We have to approach it in a way that is sensible and benefits Ireland.

That is why I spent Monday and Tuesday of this week in Brussels, at the Foreign Affairs Council and the General Affairs Council. We had a detailed and lengthy discussion at the General Affairs Council on Monday evening about the multiannual financial framework, the European budget, up to 2020. I also had a separate meeting with President Van Rompuy to discuss not only Ireland's Presidency of the European Union next year but also the issue of the multi-annual financial framework, MFF.

A number of issues will, I hope, be decided this week at the European Council. I hope they will be decided because it is in the interests of Europe and Ireland that we get a conclusion to the budget issues and decide the type of budget the European Union will have between now and 2020. That is critical because of its implications for agriculture, the agri-food sector and the Common Agricultural Policy. We need to know the budgeting that will be available for research programmes in our universities, the tie-up with research for industry and the importance of that, in turn, in attracting investment into the country from companies that will create employment and develop links and synergies with the university sector and with research and innovation so that we can grow more jobs and have more people in employment and a better economy. These discussions are critical.

It would be helpful if, when they were coming in to address this issue, Members had at least informed themselves of the basics of what the meeting this Thursday and Friday is about. We have already made progress on the issues of the bank debt and the euro. At the June European Council meeting a decision was made to separate bank and sovereign debt. At the October European Council that was carried forward and a commitment was made that a single supervisory mechanism would be put in place and that the legislative framework for that would be completed by the end of the year.

At the Foreign Affairs Council on Monday, we discussed the appalling situation in Gaza. This country has a long and proud record of speaking for the Palestinian people and for a fair solution to the crisis in the Middle East. We have done so again on this occasion. That is why we support the efforts to bring about a ceasefire and to halt the attacks on civilians, whether in Gaza, Tel Aviv or Jerusalem. Attacks on civilians, irrespective of where they are coming from, have to stop and there has to be a ceasefire and an end to the killing of innocent people in this region, and particularly in Gaza. We know the numbers, but this is not about a comparison of numbers. It is about getting a ceasefire, which we have been advocating for some time, and getting peace talks going so that there will be a permanent settlement in this area.

What is happening there is extremely worrying. It has the potential to escalate, with all the consequences that has for the people who live in the area and for the wider region. We dealt with this issue at the Foreign Affairs Council on Monday. I expect it will be addressed again at the European Council on Thursday and Friday, because of the urgency of the situation. It is something on which Ireland has taken a strong position.

I thank the Tánaiste and all Members for their contributions to the statements on the pre-European Council meeting.

Sin críoch le ráitis maidir leis an réamhchruinniú den Chomhairle Eorpach ar an 22 agus 23 Samhain.