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Dáil Éireann debate -
Tuesday, 26 Jan 2016

Vol. 904 No. 1

Ceisteanna - Questions (Resumed)

Taoiseach's Meetings and Engagements

Gerry Adams

Question:

1. Deputy Gerry Adams asked the Taoiseach if he will report on the European Union leaders' summit in Brussels in Belgium in mid-October 2015; and if he will make a statement on the matter. [42208/15]

Gerry Adams

Question:

2. Deputy Gerry Adams asked the Taoiseach when he last met with the German Chancellor, Dr. Angela Merkel; and if he will make a statement on the matter. [42225/15]

Micheál Martin

Question:

3. Deputy Micheál Martin asked the Taoiseach if he had any bilateral meetings at the European Union Council meeting on 29 November 2015; and if he will make a statement on the matter. [43474/15]

Micheál Martin

Question:

4. Deputy Micheál Martin asked the Taoiseach if he made a contribution at the European Union Council meeting on 29 November 2015; and if he will make a statement on the matter. [43475/15]

Micheál Martin

Question:

5. Deputy Micheál Martin asked the Taoiseach the status of the European Union Council meeting on 30 November 2015, including discussions on the €3 billion plan for Turkey, the easing of visa restrictions, the status of Turkey's application to join the European Union, border security, the migrant situation, and the shooting of a Russian aircraft; and if he will make a statement on the matter. [43506/15]

Gerry Adams

Question:

6. Deputy Gerry Adams asked the Taoiseach who within the Government has responsibility for preparing the Government’s political, economic and policy arguments against British Government proposals on European Union membership; and if he will make a statement on the matter. [44676/15]

Micheál Martin

Question:

7. Deputy Micheál Martin asked the Taoiseach his contributions at the European Union Council meeting on 17 December 2015; and if he will make a statement on the matter. [1823/16]

Micheál Martin

Question:

8. Deputy Micheál Martin asked the Taoiseach the agreed actions that are to be taken on European Union immigration, following the meeting of the European Union Council on 17 December 2015; and if he will make a statement on the matter. [1824/16]

Micheál Martin

Question:

9. Deputy Micheál Martin asked the Taoiseach if he spoke with the Chancellor of Germany, Dr. Angela Merkel, at the European Union Council meeting on 17 December 2015; if he discussed retrospective debt for Ireland with her, or with any other European Union leader; and if he will make a statement on the matter. [1825/16]

Richard Boyd Barrett

Question:

10. Deputy Richard Boyd Barrett asked the Taoiseach to report on the European Union Council meetings he attended in December 2015; and if he will make a statement on the matter. [1935/16]

Micheál Martin

Question:

11. Deputy Micheál Martin asked the Taoiseach if he has attended a meeting on the number of migrants that Ireland will receive from Syria and other war-torn countries; and if he will make a statement on the matter. [1959/16]

Joe Higgins

Question:

12. Deputy Joe Higgins asked the Taoiseach if he had meetings with the Chancellor of Germany, Dr. Angela Merkel; and if he will make a statement on the matter. [2801/16]

Joe Higgins

Question:

13. Deputy Joe Higgins asked the Taoiseach to report on meetings regarding the refugee crisis and Ireland's commitment to aid during the European Union Council in December 2015; and if he will make a statement on the matter. [2802/16]

Joe Higgins

Question:

14. Deputy Joe Higgins asked the Taoiseach to report on the recent European Union Council meetings he attended. [2803/16]

I reported to the House on 20 October on the detail on the outcome of the European Council meeting of 15 October. That meeting dealt with several issues of importance to the Union, with a particular focus on the complex challenge of migration. Also discussed at the meeting were the report of the five presidents, Completing Europe’s Economic and Monetary Union, and the UK plans for a referendum on its EU membership, and it was agreed in both instances to return to the issues in December. The French President, François Hollande, made a presentation in advance of the global Conference of Parties on climate change in Paris, and the European Council noted the publication of the international and independent report into the downing of flight MH17 over Ukraine.

On Sunday, 29 November, EU Heads of State and Government held a meeting with the Prime Minister of Turkey. Co-operation with Turkey is central to the European Union’s overall approach to tackling the migration crisis, and the meeting agreed a joint statement along with the European Union-Turkey joint action plan which had been negotiated by the European Commission over the previous weeks. The statement noted the European Union's agreement to provide an initial contribution of €3 billion over two years in support of the 2.2 million Syrian refugees in Turkey. Member states including Ireland will contribute to this fund once the final arrangements have been agreed.

The statement also committed to strengthening relations between the European Union and Turkey, addressing common challenges through more structured, high-level dialogue and re-energising the accession process, on which the European Commission published its annual report on 10 November. The issues of visa liberalisation for Turkish citizens and border security, both of which are mentioned in the statement, are for Schengen member states to consider in the first instance. The action plan is intended to further support refugees and their host communities in Turkey and to strengthen co-operation in preventing irregular migration. Both the European Union and Turkey have set out their intentions under the plan, which includes financial support, resettling of refugees from Turkey to the European Union, law enforcement co-operation on smuggling, joint return operations, an improved legal framework, and compulsory registration and integration measures.

It is important to emphasise that the commitments made by Turkey and the European Union in the joint action plan will have to be fulfilled. Progress on this is being very carefully monitored and will be reviewed by the European Council in due course.

The shooting down of the Russian aircraft was not discussed at the European Council meeting in November.

I had no scheduled bilateral meetings in the margins of the meeting of European Union Heads of State and Government with the Turkish Prime Minister on 29 November, although I did, of course, have informal exchanges with a number of colleagues.

I last met Chancellor Merkel at the December European Council meeting. While I engaged with the Chancellor in the course of the Council meeting, we did not have a formal bilateral meeting. I did not raise retroactive recapitalisation of the Irish banks with her or with other counterparts at that meeting. I last held a formal bilateral meeting with Chancellor Merkel during my visit to Berlin on 3 July 2014, following her own visit to Dublin in March 2014.

The British Government's proposals for EU membership were discussed most recently at the December European Council. This provided a welcome opportunity to have a collective discussion of the issue with all 28 EU Heads of State and Government and the Presidents of the EU institutions, framed by the earlier exchange of letters between the UK Prime Minister, David Cameron, and the President of the European Council, Donald Tusk. At that meeting, Mr. Cameron opened the discussion by outlining the four broad areas where he is seeking change and by explaining the complex domestic politics around the issue in the United Kingdom. I intervened in strong terms in the subsequent discussion to present the Irish point of view, which is, of course, well known to this House and in the United Kingdom and other member states. I spoke about the importance of the issue to Ireland, given the uniquely close political, social, economic and cultural ties between our countries. I also emphasised the significance of UK membership to the European Union as a whole and I stressed the importance of working together to find a mutually acceptable solution.

Regarding the proposals themselves, Ireland is supportive of moves aimed at delivering more for our citizens. We share the United Kingdom’s enthusiasm for sustained effort under the "competitiveness" heading. The issues here are the drivers of long-term prosperity for the citizens of the European Union. Under the “economic governance” and “sovereignty” headings, although the details of the proposals remain to be clarified, we can also see where solutions might lie.

In the immigration and free movement area, we can more than likely support the proposals, subject to the details, in regard to addressing fraud and abuse and changing the way in which child benefit is paid abroad. The idea of limiting access to in-work benefits is more difficult, and there is opposition to the proposal in its current form. However, I am hopeful that, with willingness and determination, a workable solution in this area can also be found.

With regard to the debate itself, I was encouraged by the substantive and very constructive exchange of views about the four categories of reform proposed by Mr. Cameron, including the difficulties. There can be little doubt that this is a challenging and sensitive issue, but the atmosphere at the European Council meeting was very positive and there was willingness to find a way forward.

Prime Minister Cameron, while not withdrawing his proposition about limiting access to in-work benefits, signalled his openness to alternative ideas that would have the same effect. We agreed, therefore, to work closely together in the period ahead, with a view to reaching agreement on a package of measures at the February European Council meeting. While the legal form and implications of the final package remain to be teased out, I welcome the fact that the Prime Minister is not pressing for early treaty change. We now await the emergence of detailed proposals from President Tusk, which are expected in early February. These will allow all member states to develop further their responses under each of the four headings and participate in intensive and collective preparatory work at senior official level leading up to the next European Council meeting, which I understand will take place on 11 February. The aim is to secure an agreement that is acceptable to all of us and will allow the Prime Minister to recommend and campaign vigorously for a vote to remain in the European Union.

I met Prime Minister Cameron again in London yesterday and we had a further excellent discussion about the state of play. He updated me on his recent contacts with colleagues and I confirmed our strong support for a positive result.

This issue has implications for all parts of Government policy. The whole of government has, therefore, been engaged in tracking the development of the debate and framing our contribution to the negotiations that are under way. The Minister for Foreign Affairs and Trade and the Minister of State with responsibility for European affairs have particular responsibilities in this respect, as do other Ministers in relevant sectors, supported by officials across Departments.

In addition to the United Kingdom's relationship with the European Union, the ongoing migration and refugee crisis was the main item of discussion at the December European Council. Heads of State and Government took stock of what has been done so far and looked at further shaping and implementing a comprehensive EU approach. There was consensus that, while important agreements were reached over the course of 2015 to establish a comprehensive response to the crisis, implementation of the measures, notably as regards the so-called hotspots, relocation and returns, has been far too slow. The European Council agreed that member states and the EU institutions must work together urgently to address these deficiencies in the system. Work on this is being progressed by the Presidency, the European Commission and the High Representative, who will report on progress at the February meeting of the European Council. Regrettably, however, in the month since the December European Council, the position has not improved and the urgent need for progress is more marked than ever. Building on earlier conferences and summits, the European Council also emphasised the importance of working with regional partners in the western Balkans and Africa.

Ireland has consistently called for an approach which addresses the root causes as well as the humanitarian challenges at European level. As I observed at the December meeting of the European Council, our immediate priority is to implement the resettlement and relocation proposals under which we have offered to accept 4,000 asylum seekers and refugees. In this context 176 Syrian refugees have already arrived in Ireland under the resettlement programme, with an additional 120 refugees due to arrive soon. While progress on relocation has been much slower, I am pleased that the first group of Syrian asylum seekers - a family of ten - arrived here recently under the relocation framework.

Our decision to opt into the relocation and resettlement programme last year was in addition to the substantial additional financial support Ireland has provided towards assisting those affected by the Syrian crisis, the World Food Programme, to which we have agreed to double our allocation in the years ahead, and the Emergency Trust Fund for Africa, as well as the support provided by the Naval Service to humanitarian search and rescue operations in the Mediterranean, of which Deputies are well aware.

The migration crisis will be a major ongoing challenge for the foreseeable future. I hope real progress will be made in the coming weeks and I look forward to discussing developments again with the other Heads of Government at the February European Council meeting.

As I noted, much of the Council's time was spent on addressing the migration and refugee crisis and the EU-UK negotiations. However, a number of other agenda items were also discussed. Most notably, the European Council considered actions in the fight against terrorism, building on the decisions taken at its February meeting and in light of the appalling attacks in Paris and elsewhere.

As outlined in my detailed statement to the House last week, there was also discussion of international developments, including the position in Syria, Ukraine and Libya, respectively, and a number of economic and financial issues, taking stock of discussions on the five presidents' report on economic and monetary union and developments in the Single Market following publication of the new strategy. Energy union and a forward-looking climate policy were discussed, following the very successful COP21 summit in Paris last year.

I call Deputy Jonathan O'Brien who is substituting for Deputy Gerry Adams.

As this is my first time substituting, I will need some guidance on timing and so forth.

It is Question Time, which means Deputies should put questions. The Deputy should be as brief as possible.

I will take a leaf out of Deputy Martin's book.

The Taoiseach raised a number of points which I would like to discuss. I refer first to the proposed referendum on a British withdrawal from the European Union, also known as Brexit. Following the Taoiseach's meeting with Prime Minister Cameron yesterday, he expressed the view that all of Britain's demands for reform of the EU could be solved and referred to a number of these demands in his response. The next meeting of the European Council will take place on 18 and 19 February. The December European Council set itself the explicit objective of securing an agreement on mutually satisfactory solutions. The British Prime Minister indicated previously that he hoped to reach a deal on Britain's membership of the EU next month, which would clear the way for a referendum as early as this summer. However, in his remarks yesterday, Mr. Cameron seemed less sure of this.

It is not necessary for me to outline the consequences of a British exit from the European Union for Ireland, especially the North. For eight decades, we have had a physical border between the two States and an economic, social, cultural and political border which has been the source of enormous dislocation and, at times, conflict. The Good Friday Agreement transformed the position, however, and the physical Border has become all but invisible. Nevertheless, much work remains to be done on the economic and political barriers between the Twenty-six Counties and Six Counties. Any move towards Brexit would be a retrograde step as it would create the potential for a return to border controls, which would have a highly detrimental impact on the economy of the Border counties. The adverse effects of a Brexit on the all-Ireland bodies established as part of the Good Friday Agreement also need to be taken into consideration.

The outcome of the UK referendum on EU membership should not determine the fate of the North in respect of these matters. Has the Taoiseach sought an assurance from the British Government that the outcome of the referendum in the North alone will determine the relationship between this State and the Six Counties? The Taoiseach referred to some of the areas on which he believes compromise could be reached. Will he elaborate on these matters?

The Taoiseach also referred to the refugee crisis and indicated that the discussions at the European Council meetings in Brussels in October, November and December, respectively, were very much focused on the issue of refugees.

I take this opportunity to commend the work of the Naval Service, which successfully rescued a staggering 8,631 people during its humanitarian operations in the Mediterranean Sea in 2015. The extraordinary loss of life as refugees flee violence, war and poverty in the Middle East and north Africa has shocked and saddened all of us. Last year, 3,770 men, women and children died trying to cross the Mediterranean. We also saw the images of the three-year-old child on a Turkish beach. I acknowledge the tremendous work that the naval vessels carried out. There are no naval vessels in the region at the moment. Traditionally, the winter months see fewer refugees trying to make the dangerous journey. Unfortunately, some are still trying to make that journey. At least 43 people, including 17 children, drowned only last Friday when their boat collapsed off the Greek islands. According to the International Organization for Migration, over 100 refugees have drowned since the start of the year. That is more than the combined totals for January 2014 and 2015. It is estimated that almost 37,000 have arrived in Italy and Greece since the beginning of the year. There is no doubt we are seeing an unprecedented growth in the number of refugees trying to cross the Mediterranean. Are there any plans? When is it planned to send Irish naval vessels back out on humanitarian missions? I wish to come back in later, a Cheann Comhairle, because I have some other questions, but I know Deputy Martin is keen to get in.

I thank Deputy O'Brien for his questions. With regard to the Brexit business, I never understood why the title is as it is because British exit is not a positive term, if I can put it that way. It is actually a choice being made by the British electorate. I have heard some comments from the MP, Mr. Dodds, and the Northern Ireland First Minister, Ms Arlene Foster, with regard to comments I made in London yesterday. I am very much aware that the decision is one for the British electorate, for those in Northern Ireland, Scotland, England and Wales. However, it is not the same as the referendum on independence in Scotland because this country has an interest in it. It is a critical decision to be made by the British electorate in respect of the European Union, Britain and Ireland in the context of our relations with Northern Ireland. Deputy O'Brien has pointed out some of these details.

Far be it from me to try to direct the British electorate or the electorate of the United Kingdom as to what way they should vote; it is their choice and their decision. However, it is important to note that there are significant numbers of Irish citizens living in Britain. Owing to the common travel area, many of them have been there for many years. Therefore, we have an interest in this. It is also important to note that €1 billion in trade is conducted across the Irish Sea every week. Britain is the biggest purchaser of food from Ireland, as we are of their produce. Many other issues arise from a common travel area. While we cannot direct the electorate on what to do when they go to vote, it is important that we set out how critical is this issue. I repeat that it is not for me to direct the British electorate, but it is important to state the importance of the decision to be made. People should be properly and fully informed.

Deputy O'Brien pointed out a number of issues about cross-Border bodies and so on. For instance, we agreed fully that the Chancellor of the Exchequer should give the Northern Ireland Executive the right to reduce corporation tax rate in Northern Ireland to something approaching or the same as the corporate tax rate here. That would make the economic entity of Ireland, from a foreign direct investment point of view, an island attraction in its own right.

To be honest, following the discussion I had with the Prime Minister, Mr. Cameron, yesterday, I am unsure whether it will be possible to conclude this set of agreements at the February meeting. There is progress to be made on all of the four issues. Progress can be made and I believe the matter can be concluded successfully. The UK Prime Minister has made it clear that it is his call regarding when he chooses to have a referendum. He said that if the deal is not clear enough or strong enough, he has time and can wait until some time before the end of 2017 to have a referendum.

The European Council is where leaders discuss concessions, changes or reforms. We all support the Single Market, the digital market, getting rid of red tape in administration and the development of trade links with TTIP and other locations throughout the world where opportunities exist. It is important that all of Europe would benefit from the changes and reforms that are being made here. It is not a case of saying that we have considered all of this and we give particular concessions to any leader around the table. We are members of the European Union. I would like Britain to continue to remain a strong and central member of that because of the power and the opportunity that comes from having 500 million people in a trading bloc with enormous potential.

I cannot say to Deputy O'Brien that it will be finished by the February meeting. Mr. Tusk, the President of the Council, will circulate his paper next week. It will deal with the discussions that have taken place following the December meeting, at which the UK Prime Minister, Mr. Cameron, tabled his four baskets, as it were, the issues of sovereignty, competitiveness, welfare and so on. In the meantime, we will continue to discuss the issue with colleagues in Brussels and Britain to see what progress might be made.

This is connected with the migration issue as well. Let us suppose the current numbers were to continue and the UK held a referendum on continued British membership of the Union in June or July. That is the time of year when numbers would be heaviest, if migration continued across the Mediterranean. It is a matter for the British Prime Minister when he wants to call the referendum.

The refugee crisis is taking up practically all the time at the meetings. It a really complicated and serious issue now. We get reports from the EU High Representative, Ms Mogherini. Some 1.2 million people have gone into south Lebanon, 25% of the Lebanese population is now Syrian and 1.2 million are in Jordan. The Prime Minister held a special event for the King of Jordan in respect of the camps there. The Union responded with a €3 billion initial fund in respect of Turkey, which has a little over 2 million refugees. Obviously, the numbers are exceptionally difficult to pin down.

A great deal of work needs to be done from a European point of view on these hotspots in respect of registration and what we do if people turn up to the hotspots where people are registered and identified. Are they to stay there in camps that the countries concerned provide? Are they to dissipate throughout the countries of the Schengen area? These are extraordinary challenges. Yet, as Deputy O'Brien has pointed out, when we see the pictures of grossly over-laden and overloaded dinghies, ribs and other craft, we can see for ourselves the scale of what is involved. Let us imagine all of Connacht and all those right down through Munster to Cork walking to Dublin and trying to cross the Irish Sea in rickety boats or whatever. It is a human movement of enormous consequences.

At the Holocaust commemorations which the Ceann Comhairle attended on Sunday, there were examples involving the MS St. Louis in 1938. The vessel went to America with 900 passengers who assumed they would be given visa entry but they were not. They had to come back again on another boat that went to Turkey and over 700 died. So many years on we have replications in some ways of what happened then.

I asked about the role of the Naval Service.

The Minister for Defence, Deputy Coveney, has already said that it would be his intention to send a naval boat again.

They rescued more than 8,500 men, women and children, and I think that gesture was appreciated by European leaders. If it is a case of making arrangements for that to happen, the Minister will do that.

I thank the Taoiseach. He took 14 questions on the European Union together. In his reply he said he had not raised the issue of retrospective recapitalisation with German Chancellor, Angela Merkel, at the European Council, despite the fact that in 2012 he and the then Tánaiste, Deputy Eamon Gilmore, were very clear that a game-changer of a meeting had occurred and that retrospective recapitalisation would apply to Ireland. At the time, the Minister for Finance, Deputy Noonan, and the Minister for Public Expenditure and Reform, Deputy Howlin, claimed they could get up to €6 billion back for Ireland through retrospective recapitalisation. Given that the Taoiseach did not raise the issue with Chancellor Merkel or at the Council meeting, is that the final confirmation that the issue is off the table as far as the Government is concerned? Is it the case that the Government is no longer seeking a retrospective recapitalisation deal in respect of Ireland's bank debt? Can he confirm that in a later reply to me?

With regard to the refugee crisis, it is accepted that the vast majority of refugees are leaving war-torn Syria and other locations because of conflict and war and because they want to seek a better life. I refer to the strengthening of relationships between Turkey and the European Union, notwithstanding the curbs on press freedom and the emergence of a more authoritarian regime in Turkey. What is the state of play in regard to the relationship between Turkey and the European Union in terms of its long-running application for membership, and the nature of the agreements that have been arrived at on the refugee crisis?

Does the Taoiseach accept that the most effective way of dealing with the refugee crisis in the short term, apart from dealing with the source of the conflict in Syria and resolving the issues there, is to provide substantial resources to the refugee camps? The Taoiseach mentioned the major camps in Lebanon, Turkey and Jordan. Improving the quality of life for those in the camps in terms of education, work and so on could potentially stem the flow of migration to Europe. Nothing is available to assist in improving the quality of life for people in those camps.

The Taoiseach said the refugee crisis had dominated the Council meetings. The recent rapes of and attacks on women in Cologne caused a lot of concern and distress. Was the issue raised at the meeting? Did the Taoiseach have any briefing on this and the potential implications for the process of integration and fully teasing out and evaluating the immigration crisis as it hits Europe? There are many far-reaching issues.

I refer to the proposed referendum on whether Britain should remain within the European Union. The Taoiseach used a wonderful phrase, on which I commend the civil servants involved. He said the Irish point of view was well known in terms of the importance of the issue and the significance of Britain. I am not so sure it is well known, and I do not think the precise or specific details of the Government's view on the specific proposals that the British Government is putting on the table have ever been spelt out. In his reply, the Taoiseach referred to competitiveness, governance and sovereignty, immigration and free movement, welfare, in-work benefits and so on. What exactly is the British Government seeking in terms of welfare proposals? Is it solely concerned about welfare fraud? Is it looking for different rates of welfare to apply in host countries or for the welfare rates in one's own country to apply if one migrates to another EU country? I refer to EU citizens. What are the proposals around free movement across the European Union? The Taoiseach mentioned that in-work benefits would prove to be a difficult issue to resolve. Can he outline what exactly the British Government is looking for in that area? What are the potential implications for Irish citizens working across the European Union if the British Government gets its way on that? Can the Taoiseach outline specifically what it is looking for?

Can the Taoiseach indicate specifically whether the British Government is seeking an accommodation for the City of London in terms of eurozone policy and access to the decision-making process within the eurozone area? Is it seeking an input into decisions that the eurozone would quite properly take for the eurozone area? The Taoiseach referred to his meeting with the British Prime Minister yesterday. Did he discuss the issue with him?

The Taoiseach said the Irish Government was in broad agreement with the British Government on competitiveness. Have labour laws, labour market flexibilities and workers' rights featured in his discussions with the British Prime Minister, or is the British Government raising those issues on the agenda of the European Council and seeking changes to existing labour market rules and regulations? That is probably enough for the Taoiseach to be getting on with at this stage.

I note the Taoiseach's comment that the legal form of the agreement is to fall short of treaty change, which in itself has implications for what is ultimately agreed. Notwithstanding the comments of Nigel Dodds, MP, and others, we are members of the European Union and therefore have every right to be involved in discussions when an existing member of the Union seeks to change the rules in order to maintain its membership. We want Britain to remain part of the European Union; it is in our best interests and that of the European Union. It is rather regrettable that Northern public representatives, in a very old-style way, seek to suggest that we be excluded from any discussions on the issue. I hope there will be some reflection on that from those protagonists.

I thank Deputy Martin. I answered his question on whether I had discussed retrospective recapitalisation. The answer was that I did not.

Does that mean the issue will not be raised again?

The Deputy has raised this issue on many previous occasions and I have made the point that it is a testament to the resilience of the Irish people and the continued support of our EU partners that this country has returned to a position in which it is able to borrow money in a sustainable way and is not blocked from the markets that we were able to access previously. Having delivered on all of the commitments and exceeded targets over the three years of the programme, it was and remains a key priority of the Government to ease the bank burden on Irish taxpayers and clean up our banks as we make our way to economic recovery. In that sense, banks have been recapitalised and restructured. IBRC was liquidated and the promissory notes replaced with long-term bonds in order to dramatically reduce our market funding requirements. Interest rate reductions on our loans were achieved, not just here but in other places. Agreement was reached with our eurozone partners for the repayment of our EFSM and ESF loans to be extended by seven years. Those steps have had the effect of stabilising our financial system and reversing the outflows of deposits and other funds that have crippled this economy for quite a number of years.

As regards recapitalisation, the European Stability Mechanism, ESM, a direct recapitalisation instrument, was agreed in principle in 2012. There is a limit of €60 billion on the total amount of ESM resources available for direct recapitalisation of institutions. Should the ESM use its direct recapitalisation instrument, it would, as a rule, acquire common shares in the beneficiary institution.

Circumstances have improved dramatically since then, and the ESM is not the only option open to us to recover the money provided to recapitalise our banks. Investors are now willing to support Irish banks again and the market value of our investments has improved accordingly.

They were always there. What I am speaking about is separate from those.

As I pointed out, and as the Minister for Finance has indicated, we expect to get all that money back for the taxpayer over the next period.

That was always the case.

The option was there and the option is still there. The Government's overall objective regarding the State's investment is to maximise the return for the Irish taxpayer over time. In line with this objective, the Department of Finance has worked with AIB, where €20.8 billion was invested, on reconfiguring the capital structure. The Minister for Finance is working with the banks and the advisers to lay out a path that will see a return of cash to the State from AIB investments over time. This plan was approved by the Single Supervisory Mechanism last November, and following approval at AIB's EGM a first payment of €1.64 billion was made to the State on 17 December. This is only the start of the process, although it is an essential first step on the road to recovering value for the taxpayer.

Regarding the Bank of Ireland investments, Deputy Martin is aware we have already made a net positive cash return from our investment in and our support for the bank, while we continue to hold, on behalf of the people, a valuable equity investment. The position was we had only one option.

No, that is not true.

As the situation began to improve, we had two, and we expect to get all the money back.

That is not true.

It is true, and Deputy Martin knows it.

Through the Chair, please.

AIB and Bank of Ireland were always going to be realised. I am talking about the debt outside of that.

It is true.

I will call Deputy Martin back in.

There was €64 billion, €32 billion of which is gone, on Deputy Martin's back, down the black hole.

We are talking about the retrospective debt outside of AIB and Bank of Ireland, which the Taoiseach said he would get back.

I ask the Deputy to please respect the Chair.

I am sorry. The Taoiseach never answers the question he is asked.

The Deputy raised a number of important issues about Turkey. Clearly, the European Union and Turkey must work together. The joint action plan agreed on 29 November is designed to assist Turkey in providing for refugees in its own territory and to prevent uncontrolled migration from there to the European Union. We are committed to working with Turkey on the €3 billion fund for supporting refugees from Syria based there. Implementation of this will be critical. Insufficient progress has been made and there is no question about this. When we spoke to other countries, Jordan and Lebanon stated they also need support. They raised a valid point on the camps. Some of them are enormous, as the Deputy is aware, and children's education, maternity facilities, hygiene facilities, food and nutrition are enormously complicated. We have no sense of the scale of what is happening in those camps.

There have been some positive moves since 29 November. The Deputy mentioned pre-accession. Chapter 17 of the accession negotiations is about economic and monetary policy, and this has been opened with Turkey. The participation of the Turkish Foreign Minister in a good discussion with EU Foreign Ministers at the December Foreign Affairs Council was the start of this. Frans Timmermans, First Vice-President of the Commission, recently met the Turkish Ministers of Foreign Affairs, European Affairs and Justice to emphasise the need to speed up implementation of the joint action plan. Vice-President Mogherini and Commissioner Hahn also met the Turkish side, where the same need for implementation was underlined. Further close monitoring of this will be critical. As the Deputy understands, these are complicated discussions.

The internal situation in Turkey is of a serious nature. The conflict between the Turkish Government and the Kurdistan Workers' Party restarted in July 2015, with 180 civilians killed in violence since then. There are clearly human rights concerns. Ireland strongly condemns the horrific suicide terrorist attacks which took place, the twin suicide bombings in Ankara on 10 October, which killed 102 people, and in Istanbul on 12 January, which killed ten people, including eight German tourists. The latest Commission progress report on the EU accession process noted a number of concerns, including with regard to significant shortcomings affecting the independence of the judiciary, freedom of assembly and freedom of expression, and we continue to raise these concerns, including most recently at the Council meeting in December. We and our European partners will continue this dialogue with Turkey.

We did not have a detailed briefing on the incidents of sexual assault and abuse in Cologne, but they were of a very serious nature. I discussed this with the Minister-President of Bavaria, Mr. Seehofer, when I had occasion to meet him in recent weeks. This is regarded as a very serious issue in Germany, and the police authorities there are on a very clear alert.

In respect of the issues raised about the UK Prime Minister and the case being put for the referendum, as I said to Deputy O'Brien, the paper in response has not yet been circulated by President Tusk. It is due early next week. We will see the detail of how he intends to respond and what input the European Commission might have. At the December meeting, President Juncker stated the Commission had views on a number of the elements attached to the four issues and he would like to make an input.

The fundamental question is not about the restructuring of freedom of movement, although there are concerns about the Schengen Agreement and whether countries are in a position to police their borders, and the issue of the Dublin Convention is being reviewed in regard to where people might be sent back if they are to be sent back for whatever reason. This is an issue that is of some concern at present to countries. In regard to the issue of welfare, in Britain there appears to be a very strong view among people that for persons to draw benefit or benefit in work, they should make a contribution before they draw to make that a workable situation. This is a central issue that comes up very often in Britain, and it is an issue that is of concern to the Prime Minister. He has said on a number of occasions that he would like to see a number of options he has tabled being considered and that an outcome could be agreed on this. I do not know the detail of this yet because I assume President Tusk will respond to this in his paper.

There will be very strong objections to any restriction on the free movement of people, and the opportunity to move from place to place comes with the Internal Market. In our case in Ireland, the common travel area between here and Britain and Northern Ireland allows for ease of doing business, commerce, trade and other activities. I believe the issue regarding the eurozone and other countries in the European Union which are not members of the eurozone is one that can be resolved. There are two currencies. In Britain there is sterling, we have the euro and there are various currencies in other countries outside the eurozone. This is an issue that can be resolved.

With regard to the Deputy's final comments, we have been very forthright about being as open and generous as Fianna Fáil was to the Northern Ireland Executive and Assembly. We have had joint trade missions to Singapore. We had personnel from Northern Ireland in Brussels during our Presidency in order that they would be fully informed on the advantages of what might be going through regarding the Common Agricultural Policy or Cohesion Fund money. In this regard, the practical arrangements on which we have worked so hard to get cross-Border activities in a range of sectors are ones on which we can build for the future. The referendum is a matter for the electorate in Northern Ireland, Scotland, Wales and England, but we are all members of the European Union. Yesterday, when I spoke to more than 120 or 130 people in McCann FitzGerald in London, I made it perfectly clear that we have a real interest in this because the decision is so critical. McCann FitzGerald is one of the big Irish law firms and has been established in London for 30 years. These people are Irish citizens who will vote in the referendum. They understand the parallel, in that when we had to vote on the fiscal stability treaty people voted 60:40 in favour of the euro, the eurozone and the European Union.

Essentially, it is a matter for those who go to vote in the United Kingdom to make their choice. We want to see Britain remain a central and strong member of the Union in the time ahead. It is of interest to Britain, it is of interest to Europe and it is certainly of interest to Ireland and Northern Ireland.

Much as the Government wishes to trumpet its success, stability and the so-called turnaround of the economy, the issue of the odious debt heaped on the back of this country and its citizens, the terrible cost that has imposed on our economy and people and the threat it represents to the economy continues to return. Has the Taoiseach read the most recent report from the European Commission, which points to the risks of our very high debt levels which it says are high in the medium term and are very sensitive to any significant shocks in economic growth? Such shocks are, of course, being widely predicted. Has the Taoiseach read the European Commission's report? It is extremely concerned about our debt and our vulnerability to economic shocks. I just came from the finance committee, where Philip Lane, the Governor of the Central Bank, made precisely the same point as the European Commission is making. He said, when asked about the growth projections of this Government and the so-called "fiscal space", that we need to have a "we may be wrong" scenario. Those were his words. He talked in particular about the problem of our high level of debt and the risk that poses to us if we are wrong. Given the gathering clouds of possible international recession, are we not pursuing a very dangerous strategy, given our high levels of debt?

That brings me to the last, linked question. This morning, the European Court of Auditors produced a report on the European Commission's handling of the Irish bailout. It is a very damning report because it says the European Commission got it badly wrong. It was charged with monitoring and giving warnings if there were problems in terms of people's budgets. The report quotes, for example, the very misguided and utterly wrong judgment of the European Commission in March 2008, when it said of the Irish economy, "the risks attached to the budgetary projections are broadly neutral for 2008". My God, did they get that wrong. The report from the auditors goes on to say the European Commission estimated the country's budgets to be much stronger than they turned out to be, and so on. They all said the European Commission was extremely bad at keeping records. They said there was no proper record-keeping of the post-crash programme teams, that there was no proper oversight of those programme teams and that alternative scenarios were not properly looked at in terms of burden-sharing on debt.

This is the point and the question. What the auditors are now confirming is something that some of us have been saying since the very beginning, namely, that the EU itself was very significantly responsible for the failures that led to the crash and that it should have shared the burden. The Taoiseach promised before the last election that he would make it share the burden. He promised that we would burn the bondholders and that there would be burden-sharing. Now we have the European Court of Auditors saying Europe was asleep at the wheel months before the crash was about to hit and engulf the economy. Is this not the time, on the back of this report, to go back to our friends in Europe and say-----

Will you stick to the questions that are on the Order Paper?

We cannot have a general discussion here. This is not one of the questions on the Order Paper.

The previous discussions have all been very general.

Deputy Martin has seven questions and-----

Deputy O'Brien has two. You have one question.

Sorry, Deputy, you have one, Question No. 10, which is to do with the report on the European Council meetings.

This is an entirely separate subject from anything on the Order Paper.

It is not; it is about the European Council meetings and whether-----

No, it has nothing to do with the recent report-----

It absolutely does. From the European Commission-----

Would you finish up, please? I want to try to get the others back in.

You did not cut anybody else off.

No, because you have only one question, Deputy. Would you stick to the questions on the Order Paper? That is my job.

Everybody else ranged across four or five subjects-----

I am very careful about-----

-----from the Brexit to the European economy to the refugee crisis, and so on. Given this report, is the Taoiseach going to go back to the European Council and say now we have a European body itself saying that Europe was significantly responsible for failing to recognise the warning signals, which it was supposed to be monitoring, and that the programme management of the bailout may have been fundamentally flawed, should we now ask for debt writedown, given the vulnerability of our economy to debt and to shocks to the economy?

Finally, and very briefly, did the Taoiseach raise with Prime Minister Cameron and President Hollande, in the face of this disastrous refugee crisis, the absolute folly and immorality of bombing Syria and making the situation worse and, in the case of Britain, its culpability for creating the conditions for the refugee crisis through the previous bombing of Iraq and the disastrous consequences that has had? As well as dealing with the-----

Sorry, Deputy-----

-----human tragedy of millions of displaced people, should we not be calling out the utter folly and immorality of responding to this terrible crisis by bombing the countries that have been so devastated?

Deputy Martin, would you like to put your supplementary question? We will then hear from Deputy O'Brien.

In Question No. 9 I asked the Taoiseach whether he had spoken to Chancellor Merkel at the European Council meeting and whether he had discussed retrospective debt forgiveness for Ireland with her or with any other European leader. He said he did not. In his reply, he is now saying that the investment in AIB and Bank of Ireland and so on, which the previous Government made, was effective. It was always understood that the retrospective debt forgiveness was outside of those; it was in respect of losses in other banks. In 2012, when the game changer meeting was announced with Mario Monti and the then Commissioner and so on, it was understood that the option of selling AIB and Bank of Ireland was always there. The non-recoupable debt that was entered into was always the key point. The Taoiseach promised to burn the bondholders. The former Tánaiste did it in more graphic terms when he said it was "Frankfurt's way or Labour's way". We know Jean-Claude Trichet said a bomb would go off and that it would be in Dublin that it would go off. He said that to the Minister for Finance, Deputy Noonan. The Minister confirmed that to the banking inquiry. The European Union's position that banks must not be allowed to fail, after Lehmann's, and that the bondholders must not be burned was, therefore, very clear. That was made clear to the previous Government and to this Government.

On the debt issue, there was a decision in 2012 by the European Council. We were led to believe by the Taoiseach and the former Tánaiste that this was a game changer of a decision, which would lead to a retrospective debt deal. The Ministers, Deputies Noonan and Howlin, had a press conference about it and said we could expect about €6 billion. We cannot dress it up or camouflage all of that by identifying AIB as the new route. That was always there as a route. Bank of Ireland was always there as a route, before any mention of a game changer. Is it now the Government's position that it is no longer seeking a retrospective debt deal? I just want a simple yes or no response to that.

I call on Deputy O'Brien.

Given the lack of time, I will let the Taoiseach respond to the questions.

Deputy Boyd Barrett asked about the European Court of Auditors report and the Commission's response.

This is 120 pages long and obviously it will require some reading. Certainly, there was no self-criticism of the Commission's actions in the financial assistance programme. At the same time, the Court of Auditors noted specifically the unprecedented nature and extent of the financial crisis. In that context, it stated that the assistance programmes were mostly soundly based and that the Commission's capacities for dealing with the programmes improved over time. We were first out of that gap, as Deputy Martin will be well aware. It is fine and true to say that was always there in terms of the banks, but when the banks were deemed to be worthless one had no other option but to ask, "How will we be able to recoup what the Irish taxpayer put into this?" That is why €60 billion was put aside as an option under that facility. As the Deputy will be aware, matters have moved on strongly since then.

So the Taoiseach is not seeking it.

I cannot see it being pursued now. It would require unanimity from around the table. The reflection of other countries on the progress made by Ireland, being the fastest growing economy for the past two years with our deficit to be wiped out by 2017-2018 and our debt falling towards European norms, puts us in a very different position from where we were only a few years ago.

Deputy Boyd Barrett asked about the fiscal space. That is the sum of money that is available up to 2021. It is the amount of money the Department of Finance estimates will be available for expenditure increases and tax reductions in each budget. That is based, as Deputy Boyd Barrett will be aware, on an assessment of Ireland's compliance with the benchmarks that have been set for expenditure. It is a very important figure because, in the absence of measures to offset this, expenditure and tax commitments must be accommodated within the available fiscal space.

At budget time, the Department of Finance estimated that there would be gross fiscal space over the next five budgets of €10.9 billion. In addition, the Department set out that if a decision is taken not to index the tax system, as was the case in 2016, an additional €2 billion in fiscal space would be available. That means that if one introduces a tax and raises money from it, one is entitled to spend that money. If the tax system is not indexed, that is counted, if one likes, as a tax which amounts to approximately €2 billion.

It was €8.9 billion. The Department of Finance stated it was €8.9 billion.

However, one must remember that is the total amount of money that is available and it has to accommodate the cost each year of decisions taken by the Government, including the public capital plan-----

It is based on growth projections.

-----and the Lansdowne Road agreement. In addition, the Department of Public Expenditure and Reform estimates that an average of €400 million of that fiscal space in each year - €2 billion over the next five budgets - is required to meet demographic and other costs that will arise. Taking those factors into account, the net fiscal space that was estimated at budget time was €8.6 billion. In line with the fiscal rules, the European Commission updates each member state's minimum medium-term objectives every three years and the updated medium-term objective to cover the period 2017-2019 is expected in the next week or two. Given the decline in the Irish debt ratio and other factors, it is likely that the minimum medium-term objective proposed by the Commission for Ireland might be slightly less stringent than was previously the case. The Department of Finance has estimated that a structural deficit of -0.5% of GDP rather than the current 0% of GDP is more likely but we will have to await the outcome of all those technical discussions as to what that actually will be. While there are many moving parts to it, a decision to adopt a less stringent medium-term objective would add an estimated €1.5 billion to the indicative fiscal space in total over the period 2017 to 2021 and that would increase the gross fiscal space from €10.9 billion to approximately €12.5 billion and the net fiscal space from €8.6 billion to €10 billion, all other things being equal. The Minister for Finance will spell out further details of that when he is given the updated review by the European Commission.

That is getting ready for the manifesto.

Written Answers follow Adjournment.
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