The first item on the agenda is the discussion with the Minister of State with responsibility for European affairs, Deputy Lucinda Creighton, of the forthcoming General Affairs Council meeting. I welcome the Minister of State and invite her to make her opening comments.
General Affairs Council: Discussion with Minister of State
I thank the Vice Chairman and the members of the committee. I am pleased to be before the committee again ahead of this month's meeting of the General Affairs Council, GAC, in Luxembourg on Tuesday next, 26 June. It will be an all-day meeting and the last General Affairs Council meeting under the Danish EU Presidency. I pay tribute to the Danish Presidency for its adept handling of the Chair during the past six months. The meeting comes ahead of the important June European Council meeting at the end of next week. I will represent Ireland next Tuesday.
The main issues for discussion include enlargement policy, especially relating to Montenegro, further work on cohesion policy, the next multi-annual financial framework, MFF, and preparation of the aforementioned June European Council. During lunch, we will be joined by President Van Rompuy via video link. I expect he will brief us on the report he is preparing for leaders concerning building blocks and the working methods needed to strengthen economic and monetary union. The afternoon session will involve the formal preparation of the European Council, including consideration of country-specific recommendations under the European semester that the European Council will have before it for endorsement. Ministers will also have a discussion on the current draft European Council conclusions.
I refer to the enlargement brief, specifically the issue of opening accession negotiations with Montenegro. The European Council considered this issue in December but deferred taking a decision until this month to allow Montenegro to register sufficient progress on achieving reforms in the areas of the judiciary, fundamental rights, organised crime and corruption. Our position has remained unchanged since the December European Council. The steps the Government in Podgorica has taken to advance the process should be recognised and supported. A failure to open negotiations at this time would undoubtedly weaken the credibility of the accession process, a process Ireland has fully supported and will continue to support. I hope my visit to Montenegro next month will be in the context of preparing to oversee its accession negotiations during our Presidency of the European Council.
During the meeting last week of the Select Committee on European Union Affairs which discussed the European Communities (Amendment) Bill, I undertook to give this committee more details of my upcoming trip to the Balkans and Turkey. The trip to the Balkans is the first of two proposed trips I will make to the region in advance of our Presidency. I will begin in Podgorica on Thursday, 5 July, where I will meet the Montenegrin foreign minister, Milan Rocen, to discuss future prospects for Montenegro's accession negotiations. The following day I hope to meet with President Vujanovic and Prime Minister Lukšic.
From Montenegro I will proceed to Dubrovnik to attend the Croatia summit, where I hope to address a panel session on "The EU perspective as a driving force for social and political change". Deputy Timmy Dooley will also be part of the Irish delegation to the summit and I look forward to seeing him there. I plan to use the opportunity of this prestigious gathering to meet several interlocutors from the region, not least the Croatian foreign minister, Vesna Pusic, and others from the Croatian Government. Since my time in Bosnia-Herzegovina will be short, I will use the visit to Dubrovnik to meet the EU high representative, Valentin Inzko, and the EU special representative, Peter Sørensen, for briefings on the current situation in advance of my visit.
My visit to Bosnia-Herzegovina will also be as the representative of the Chairperson-in-Office of the OSCE. From Dubrovnik I will travel to Sarajevo by road, stopping off briefly in Mostar on the way, where I will meet people from the OSCE office for a briefing on the challenges faced by that town for the future. In Sarajevo, I hope to meet members of the state-level government, including the chair of the presidency, the chair of the council of ministers, and the foreign minister. I hope to gain some first-hand knowledge of how Bosnia is progressing on the path to EU integration. I will impress on my Bosnian contacts the need to address the necessary reforms, especially the implementation of the European Court of Human Rights ruling on Sejdic and Finci. A credible effort towards implementation is required for the EU to ratify the stabilisation and association agreement. I realise the committee is also planning a visit to the Balkans in September and I would be pleased to brief the committee on the outcome of my visit before then. From Sarajevo I will fly to Turkey and visit Istanbul and Ankara. The focus of the visit in Ankara will be a meeting with minister for European integration, Egemen Bagis.
The General Affairs Council will continue its discussion of the Commission's legislative proposals for cohesion policy. The Council agreed in April to a so-called partial general approach on six thematic blocks: programming, conditionality, management and control, monitoring and evaluation, eligibility, and major projects. The Presidency will present an additional four blocks to next week's Council: thematic concentration, financial instruments, net revenue generating operations and public private partnerships, and performance framework. We are prepared to accept the Presidency's partial general approach to these thematic blocks, subject to the proviso that nothing is agreed until everything is agreed. In particular, the elements for a partial general approach submitted should not prejudge the outcome of other negotiations, especially those on the multi-annual financial framework.
As the committee is aware, the Danish Presidency has been preparing a so-called negotiating box for the multi-annual financial framework. This is a draft outline of the final agreement on the MFF which it will present to the European Council later this month with a view to settling as many issues as possible at that stage. Naturally in this case as well, nothing will be agreed until everything is agreed. The committee will recall that the full negotiating box was discussed for the first time by Ministers at last month's General Affairs Council. It was also discussed at the informal meeting of European Union affairs ministers which took place in Horsens, Denmark on 11 June.
At both meetings, member states reiterated their existing positions on the MFF. I stressed the importance of the Common Agricultural Policy and its contribution to growth and the need for cohesion policy to focus on youth employment. Our position on the MFF is clear. As the committee is aware, we seek a properly funded and properly functioning EU with the right mix of priorities, a fair allocation of resources and a firm focus on jobs and growth. We envisage a need for continued food security and safety and this warrants only gradual changes to the CAP. We also have an express national interest in defending our share of CAP payments. In particular, we are keen for the MFF to reflect the importance of job creation as well as growth. We will emphasise the importance of agriculture and the agrifood sector for growth.
While we are slowly approaching agreement on the MFF, it is clear that there are still wide gaps between the positions of member states and there is a long way to go before a final agreement will be within reach. The most difficult issues in the coming months will include the overall size of the MFF, the relative proportions allocated to the CAP and the Cohesion Fund and other headings, and the funding of the EU budget, including arrangements for rebates and corrections. I do not expect these questions to be resolved until close to the end of negotiations, but I am confident that agreement can and will be reached. We will do what we can to support the incoming Cypriot Presidency in its efforts to broker a deal. I look forward to the opportunity to discuss the MFF with the committee more broadly and in greater detail at our meeting next Wednesday.
Next week's GAC meeting will have before it the current set of draft European Council conclusions, circulated by President Van Rompuy. The draft conclusions are being discussed in Brussels today by COREPER representatives ahead of next Tuesday's consideration by Ministers.
I expect developments in the euro area will feature prominently during next week's European Council meeting. A euro summit is envisaged to immediately follow the conclusion of the European Council meeting on Friday, 29 June. It is anticipated the European Council will adopt a new compact for growth and jobs which is intended to provide a coherent framework for action at national, EU and euro area levels. This is a welcome development which the Government has been advocating actively and working towards for some considerable time. We have consistently stated that Europe needs a growth agenda to complement the stability agenda. The current draft conclusions foresee the new compact for growth and jobs as addressing three broad areas. First, it concerns itself with actions to be taken at member state level. These include those to be taken in the context of the Europe 2020 strategy and in implementing structural reforms foreseen in the country-specific recommendations. Second is the contribution of European policies to growth. The measures in this regard include deepening the Single Market, making progress on achieving the digital Single Market, increasing the European Investment Bank's capital and the launch of the Project Bond pilot phase. For Ireland, proposals which can help to get investment flowing again to where it is most needed are to be warmly welcomed.
Strengthening the position of Europe's banking system and financial stability is another area highlighted, the importance of which cannot be overstated. The Government has stated clearly that there will be no sustainable solution to the current crisis without a solution on banking. Severing the link between banking and sovereign debt must be central to this. The scope for trade to contribute as an engine for growth is highlighted further. Negotiations on wide-ranging free trade agreements with Canada, Singapore and India are well under way, while the prospects of opening trade talks with Japan have strengthened. The EU is engaging intensively with the US on the future of our transatlantic trade and investment relationship. Each of these are important and welcome developments. The matter of EU-US trade will be an important plank in our Presidency priorities in the first half of 2013, about which we will speak to the committee at a later date.
The third area concerns EMU related growth factors centred on the further strengthening of economic and fiscal co-ordination. This section of the draft conclusions refers to member states' commitments under the Euro Plus pact as well as the stability treaty. President Van Rompuy's report, prepared together with Presidents Barroso, Draghi and Juncker, sets out the building blocks and the working methods needed to strengthen the economic and monetary union. This is, as yet, unavailable and thus a significant aspect of this section in the draft conclusions remains to be fleshed out.
I look forward to receiving President Van Rompuy's report and to engaging with him – by means of a video link – during a lunch meeting next Tuesday. We hope it will be possible to identify what can be done immediately, what can be done in the medium term and other steps which may take years to deliver. Thus, we are at the first but none the less critical step in the process.
The European Council is also expected to conclude formally the European semester process, with the endorsement of the country-specific recommendations. This will focus on the range of steps which member states will take during the year ahead on fiscal consolidation, lending, growth and competitiveness, unemployment and public administration. As I have set out, next week's European Council will also discuss the MFF negotiating box and offer orientations to the Cypriot Presidency. It will address the issue of opening accession negotiations with Montenegro.
Leaders will also take stock of progress in major justice and home affairs files, including Schengen governance and the common European asylum system. Nuclear energy issues concerning safety stress tests and nuclear security will also be considered. The European Council will also adopt conclusions on Syria where the situation continues to deteriorate and the ongoing violence has now regrettably led the UN to suspend its monitoring mission. This item will be discussed at the Foreign Affairs Council on Monday and this will feed into the Council. The Tánaiste will represent Ireland at the Foreign Affairs Council meeting. I expect the European Council will strongly condemn the brutal violence and massacres of civilians which have taken place and emphasise the need for those responsible for such atrocities to be held accountable. There will be a clear call on all sides in Syria to stop the violence and in particular for the Syrian regime to cease immediately its unacceptable attacks and use of heavy weaponry against the civilian population. The current situation clearly calls for more concerted international efforts to end the violence. The European Council will make this call and it will also call for immediate implementation of the Annan plan which, despite the major difficulties it has encountered in being implemented, still provides the only agreed basis for ending the violence and initiating an urgently needed process of political transition and reform within Syria.
I appreciate the attention of the committee and I look forward to hearing the comments of members. I will, as always, be happy to discuss any points or queries from members.
I have several questions for the Minister of State. The French Foreign Minister has spoken about the Annan plan becoming mandatory. The Joint Committee on Foreign Affairs and Trade recently heard from Syrians based in Ireland, and their account of what is happening to their families in Syria was harrowing. Will Ireland take the position advocated by the French Foreign Minister that the Annan plan should be mandatory and must be honoured? The view of the Syrians who gave evidence to the joint committee was that the Assad regime - President Assad appears to be a puppet figure for that military regime - is taking advantage of these peace agreements being brokered by Kofi Annan and others of goodwill, and the regime is continuing to attack various positions in the country. What is the Irish Government position? The Annan plan has to be the way forward but it must be honoured.
I welcome the Minister of State's upcoming immense efforts with regard to the Balkans. This committee and the Joint Committee on Foreign Affairs and Trade has continued to have an interest in Bosnia. Not so long ago the people of that region suffered intolerably at the hands of monsters, a number of whom have been before the International Criminal Court. A few issues have come to my attention. Regulations permitted former residents of Srebrenica, who had been driven out by those monsters, to vote. They had been forced out of their home city and community but they still had the right to vote in the mayoral elections. It seems this right is to be removed under new regulations. There is a concern that the next mayor of the city might be a person who denies the massacre that happened at Srebrenica. This will not help to stabilise the situation there. The Dayton agreement allowed for this Srpska republic, which is quite a significant part of Bosnia and a majority of Bosnian Serbs are in control of the region. There are concerns with regard to many issues. Will they seek to undermine some of the agreed international practices such as in judicial matters? Is there an attempt to undermine some of the agreed competences? The Dayton Agreement was regarded by some as rewarding the ethnic cleansers. It was a very controversial agreement. I refer to The War is Dead, Long Live the War: Bosnia - The Reckoning, by Ed Vulliamy, a journalist from Italy who covered by that period and recorded the horrendous events. In his view, the situation is deteriorating in that region. Paddy Ashdown, the former EU representative, has said the situation is getting worse. I urge the Minister of State, when she visits the Balkans region, to do her best to engage with those who are concerned, either with Paddy Ashdown or Ed Vulliamy to see what action the international community could take to protect the rights of those who were victims of a monstrous regime which committed horrendous war crimes. We should protect that very vulnerable and fragile Bosnia-Herzegovina. I implore our Government to take a lead in this regard.
With regard to the pressing economic issues of our country, we have had plenty of opportunities for engagement on these matters. Is there a sense of the growth agenda? François Hollande has been emboldened by the victory of his party in the recent National Assembly elections and it now has control over the National Assembly. He is, therefore, in a very strong position to advance the French perspective as he and his party see it. Obviously, France is now pushing for a growth agenda and I understand Ireland is also. How much investment would be forthcoming for Ireland as a result of such an agenda being adopted? What would be the strategy relating to that agenda? Where would the money be invested? Would it be in next generation broadband, developing school and hospital infrastructure, the smart economy or the small business sector? What is the plan and how much money will be made available to Ireland?
I am trying to obtain a sense of what will be involved. There has been a great deal of focus on austerity and on salvaging the banks. We now need to be made aware of the details relating to the growth agenda. Such an agenda will actually convince those in the international markets that they can safely begin to consider purchasing sovereign bonds again. This would be of major assistance to Ireland. Will the Minister of State outline her views on these matters?
I thank the Minister of State for coming before the committee and for making an enlightening and fairly comprehensive address in respect of the upcoming meeting of the General Affairs Council. There are a number of issues which are extremely important in the context of the European agenda. The policy being pursued in respect of the western Balkans is entirely correct. It is vital that the European Union should continue to develop the discussions that are taking place. History shows that leaving work unfinished is extremely dangerous. I strongly support the Minister of State in respect of and compliment her on her pursuit of the ideal in this regard. Her proposed trip to the region will be beneficial in the context of obtaining first-hand experience. I visited the region in a private capacity on more than one occasion and learned quite a lot about it. I welcome the fact that the Minister will be visiting Turkey in the aftermath of her trip to the western Balkans. She will find that Turkey is a useful and stable ally to have in the region. It is always willing to help and offer support in the context of finding peaceful solutions in respect of what has proven to be an extremely volatile region in the past. There is, of course, the possibility that it could become volatile again in the future.
There is a matter to which I have referred on previous occasions and which I wish to raise again. I accept that I risk becoming boring but it must be stated that, whether we like it or not, Europe is in hiatus at present. All the current emphasis is on fiscal and economic union and the failures that have occurred in this particular regard. What has been missed is the fact that the political unanimity which existed 20 years ago has disappeared. Member states are no longer addressing the issue from within, they are addressing it from without. Even the general debate in this country from time to time takes the form of looking at Europe from the outside. Each member state is a part of the European Union but there has been an increasing tendency in the past five to ten years for member states to take a "them and us" approach to it. That is a sad reflection on what European leaders have been doing.
I accept that there are economic difficulties at present. In times of economic stress, there is a tendency to resile from the centre and move into areas of security and comfort. However, that is not the route to take. I know she is already committed in this regard but I ask the Minister of State to use every opportunity, both in the lead up to and during the Irish Presidency of the EU, to bring all European Union leaders - those whose countries are within the eurozone and those whose countries are outside it - together in common cause in order to redefine, reappraise, redetermine and reaffirm the concept of the European agenda. Doing this would not mean that one country might subsume another or vice versa, it simply means that there would be commonality in thought, objectivity and what we are seeking to achieve. If the leaders of the various European Union member states all think in European terms, it will make life a great deal easier.
We have all the crises - economic, fiscal and banking - we need to keep us going for some considerable time. However, the important aspect to recognise is that we require the type of cohesive thinking that is needed to do the job which must be done. If such thinking does not emerge, then other serious problems will emerge in five or ten years' time and the European Union will fragment. Once, for whatever reason, fragmentation begins there will be consequences. There is never anything new in history because it always repeats itself. All that happens is that a new generation is obliged to learn the hard way. I strongly support the concept being pursued by the Minister of State and the Government in this area. In so far as is possible, the committee should do what it can to assist in this regard.
Another question which arises is that which relates to stability in fiscal and economic terms. Stability is something for which we must strive. It does not come easy and we have to work at it. There is a danger that, because people are seeking hope, we may grasp at whatever proposal is put forward at any given time as being the ultimate answer to our prayers. This also happened during the Great Depression in the United States and it is not always the case. What we need to do is perform a gradual, slow turn in order that we might get the wind at our backs. A huge effort will be required in this regard on the part of everyone in every country. It cannot be the case that one country might prosper at the expense of another. We must adopt the motto from The Three Musketeers and ensure that our approach is “All for one and one for all”. It is as simple as that. If such an approach does not work, then nothing will.
The Minister of State correctly pointed out that the Common Agricultural Policy is very important to this country. It is fundamental to both Ireland and other European Union member states. There is a need to recognise this as a European issue. It should not be seen in terms of one region of the Union benefiting to the greatest extent possible but rather in the context that the entire Union benefits from adherence to the Common Agricultural Policy. That is extremely important. It should not be forgotten that the European Union has the ability to produce much more food than has been the case heretofore. In a world where the demand for food is continually increasing, the Union is in a position to do a great deal more.
The final matter to which I wish to refer is Syria. I accept that the European Union is in a difficult position in economic, fiscal and political terms and I fully appreciate the problems relating to engaging in any intervention other than that of a diplomatic nature. The European Union and the UN failed in their efforts in Bosnia-Herzegovina in the past and stood by helplessly while things which should not have happened proceeded to occur. The UN did not fulfil its mandate properly in Bosnia-Herzegovina. There are those who stated afterwards that it did not have the firepower to do so but that does not matter. The atrocities which took place in the 1990s while the rest of the civilised world looked on were completely unacceptable and are a blight on the history of Europe.
When difficulties arose in Somalia, the intervention engaged in by the UN and others was not useful. This was not well organised and it did not work. Again, the civilised world failed to address the issues that arose. This was despite the fact that all kinds of sophisticated weaponry were available and equally sophisticated negotiating techniques were at our disposal. The civilised world failed miserably in respect of Somalia. There is always an onus on the rest of society to intervene in cases such as those relating to Syria, Bosnia-Herzegovina and Somalia. The difficulty and the dilemma in this regard relate to the issue of when it is right to intervene. In the aftermath of a crisis such as that relating to Iraq, there is no point in stating after the fact that no one should have intervened. There were things happening in that country which were completely unacceptable. In hindsight, however, the intervention was wrong and it did not work well. We have inherited a situation in which it is now difficult for European and other countries in the western hemisphere to get involved. However, there are issues which need to be addressed.
Regardless of whether it is off the shores of Europe or in states located on its borders or nearby, we cannot allow situations such as those to which I refer to develop. When we purport to be part of a global and civilised society we cannot continue indefinitely to allow atrocities to take place, notwithstanding the fact that they are taking place in a different jurisdiction. I am fully conscious of the difficulty about regime change. Such change is a difficult and dangerous thing in which to get involved. I plead with the Minister of State, and I know she is doing what I ask, to use her influence with her European colleagues - who in turn can use their influence with their colleagues throughout the United Nations, particularly at the UN Security Council which has been roundly criticised by organisations such as Amnesty International and many others - in a positive way to bring about a situation whereby those carrying out atrocities will no longer feel they have the support of a broader community outside and will no longer have access to arms and weapons to carry out those atrocities.
I call the Minister of State, Deputy Creighton.
As there is a broad range of issues to be discussed, it is not surprising there is a broad range of comments and questions. I will begin with the crisis in Syria. All I can say to Deputy Mac Lochlainn is that we fully support the Annan plan. It is the only possible blueprint to deal with the escalating crisis in Syria. I have no doubt the Tánaiste will lend his support to the implementation of, and full EU support for, the plan. The international community will have to examine ways in which it can impact and be linked to potential sanctions and other measures. Unfortunately, the tools available to the international community are limited. They must be very targeted and focused. That is part of the discussion that will take place at the Foreign Affairs Council, FAC, on Monday, which will feed into the discussion ultimately at the European Council on Thursday. That is very much the position of the Irish Government and we are very committed to ensuring that the Annan plan will be revived and honoured, and that steps will be taken, by agreement, by the international community to make that happen.
On Deputy Mac Lochlainn's specific question on the issue of former residents being able to vote in Bosnia, I understand that was a decision of the Bosnia parliament and that it was not intended to be a long-term or permanent measure. I do not know if it is definitive that it will not apply in the next round of elections but it was always understood that it would not be a permanent arrangement. I can look into that in more detail for the Deputy.
On the Deputy's question regarding the EU, the international community and how we respond to the idea of a person going forward as a candidate for mayoral elections who is effectively a genocide denier, it has been repeatedly made clear by the EU, member states and governments of the western world that this is not an acceptable position and that genocide deniers are not suitable candidates and cannot be tolerated as candidates. That position is very clear.
We discussed Bosnia previously and I am trying to ensure that I engage in a wide-ranging programme. My visit there is very short. That is the only difficulty, namely, time constraints. We are trying to fit a lot into a very full programme. I will try to meet a representative range of individuals to ensure that I have the broadest possible picture and that I have an opportunity to put forward our position in terms of the need for the government to fully support democracy building, institution building, rule of law and respect for the human rights of all citizens in Bosnia. That is very much our position and I will be communicate that clearly. The Deputy can be reassured of that. Those were the Deputy's two specific questions on that area.
On the question regarding the growth agenda, an interesting feature, although it is not a part of the formal programme, is that I was invited, at very short notice, along with the other European Affairs Ministers to attend a dinner on Monday evening with Werner Hoyer, a former Minister for European Affairs in Germany, who is now the head of the European Investment Bank. He has put forward concrete proposals in the past 24 hours on the growth agenda and how the EIB might play into that almost common agenda now at European level. That will be an interesting opportunity to have a quite informal discussion with him.
Mr. Hoyer has also expressed an interest in coming to Dublin at some point. He is conscious of the fact that as a programme country we are fulfilling all of our obligations under the bailout programme and the EIB is interested in co-operating and exploring avenues of opportunities in Ireland. In a nutshell, the concrete proposal from him is the allocation of an additional €10 billion in capital for the European Investment Bank, which would provide up to €60 billion of additional financing from the European Investment Bank for all members states, particularly including support for the less developed regions. There is a good deal of language in his document referring to countries like Ireland that are in bailout programmes. This is all encouraging. He estimates there is the potential to leverage up that money to €180 billion through co-financing. That would unleash some potential for specific targeted projects. I only got this paper before I came to the meeting. In a nutshell, what he and the EIB are talking about is an EU innovation and skills initiative which would target high-tech industries, which is very much suitable for a country like Ireland in that we consider ourselves to be the tech capital of Europe, including areas of key enabling technologies, life sciences, pharmaceutical, biotechnology and medical technology, all very much compatible with our economic model. He specifically talks about focusing on youth unemployment and activation, education and training opportunities. Also the EU SME access to finance initiative would aim to maintain access to finance for solvent SMEs, including the widening of counterparts for EIB lending and expansion of EIF support. This is all very positive. Also there is the EU resource efficiency initiative, which would target the environment, water and waste management agro-industries, which is very suitable for Ireland, bio-based products, climate change and renewable energies, especially innovative wind power. This is very much language with which we can identify. We will need to drill down to the individual opportunities that will present themselves. We already examined some months ago the area of project bonds and the various opportunities that might arise for Ireland and different initiatives. Our concern initially with project bonds was that they were very much focused on transnational projects, projects that were not tailored or suitable for a small island country such as ours. That view is changing at a European level. There is a growing recognition that there needs to be a flexible approach to suit the so-called more peripheral countries, mainland European countries and the various economic profiles and geographical profiles that apply to different member states. It is positive news. I will have more opportunity to question Mr. Hoyer and to get a clearer picture in advance of the GAERC at our dinner on Monday evening, but the initial signs are very welcome and positive.
The growth agenda does not only cover the short term. This is perhaps where politically we would part company in the sense that I believe there is a big opportunity for these kinds of co-financing projects and EIB-led investment projects. We cannot avoid the need for structural reforms. There cannot be European recovery, and it does not matter how many stimulus programmes we run, until we reform on a member state by member state basis, which is what all the new mechanisms under the European six-pack are all about. In this country's case it is about implementing our bailout programme agenda. The memorandum of understanding is the template for us and we must get on with that. Other member states must introduce labour market reforms and other reforms. Coupled with that is an initiative that is driving the European Single Market, which is close to my heart. It is one that will be front and centre of the Irish EU Presidency agenda. We will drive reform and progress on the digital agenda and all aspects of the Single Market agenda, including the implementation of the services directive. All of those big policy initiatives must be implemented. We must move on from talking about them and start to implement them. There is much scope but we need the political will to do it. The political will is there in a way that was not apparent previously.
The final element of it is the bigger question. I also firmly hold the view that the European Union and in particular the eurozone economies cannot recover until the euro crisis is resolved. The Deputy's view is rightly in some sense that the growth agenda in terms of stimulus, the European Investment Bank, EIB, and project bonds will convince the international markets. That is partly correct. I do not believe it is correct of itself. I do not believe that announcing a stimulus programme following the summit on Thursday or Friday will calm the markets. We must have much bigger solutions to the eurozone crisis. The move towards banking union is an important part of that. It is a statement and a clear signal that we no longer consider banking to be a sovereign issue or that banks can exist behind borders because they do not. Mr. Mervyn King has said that banks are international in their life but national in their debt. We must move away from that. We must wait to see the concrete proposals. The Government and the Department of Finance must reflect and do some work on what exactly we want to get out of it. I feel strongly that a Europe-wide bank resolution scheme and a bank guarantee scheme are elements that we need to achieve. The summit next week will be the first step on the road. All of those elements combined will lead to good news coming from the summit. We are always led to believe that every summit is a crisis summit and that each one is supposed to solve all of our problems but that is not realistic. It will, however, bring us dramatically further along the path with this multifaceted approach, which is the right approach. That is it in a nutshell on the growth agenda.
I thank Deputy Durkan for his comments and his welcome for the priority we are giving to the Balkans region and the visit to Turkey. They are both important, in terms of bilateral relations from this country's perspective but also in our position of responsibility as we assume the Presidency of the European Union. I agree with all of the statements and sentiment on our moral obligations to the Balkans. We must remember the recent history of the area and ensure that we play our part as a member state and in particular holding the Presidency of the European Council to drive the agenda forward and to make it clear from a political point of view that we are not forgetting about the region and we regard highly the importance of bilateral and multilateral relations and that we want to assist in the path to further European integration and enlargement. That is very much the reason I will travel there in July and why I will go back to visit the outstanding countries in, I hope, September. No doubt I will be back before the committee to talk about that at a later stage. I will be happy to come back and brief the committee perhaps as part of the next pre-GAERC briefing on those important contacts.
I agree with Deputy Durkan in terms of the preparations for the Irish Presidency of the need for us to bring a new pan-European focus to the debate. I could not agree with him more. I dislike the sort of inward looking nationalistic commentary we are getting in the Irish media in particular, but it is not just in the Irish media, it is in all of the media in the member states at the moment. A suspicion is being generated and is being stirred up which is dangerous. That is how the First World War and the Second World War happened. It is nationalism that has torn the countries of the western Balkans apart in the not so distant past. This stoking up of suspicion, mistrust and cynicism between member states is counter-productive and we must end it. We have a difference of opinion with lots of member states on a range of issues. If we take banking, we probably have some differences of opinion with Germany. That is being highlighted in the press all of the time. We have a very different position to the United Kingdom on the Common Agricultural Policy. We have a very different view to the Netherlands on the size of the multi-annual financial framework, MFF. That is the nature of democracy and decision making among 27 sovereign countries but if we do not respect those other positions we have no hope of arriving at consensus. We must understand what is driving the reluctance or fear in other member states on, for example, the introduction of eurobonds. We are in favour of eurobonds but other countries are not. Instead of slating them and going on a collision course we must persuade them. That is how one builds consensus and that is how one gets people to agree and come around to one's way of thinking. That is what we are working hard to achieve.
For a number of reasons this country is poised to have a positive impact on the consensus-building agenda. First, we are a small member state. There is always a certain suspicion of the big member states when they start leading an initiative or leading on a particular policy agenda. We have seen that in the eurozone crisis but we see it at other times as well. Second, we are performing so well in our bailout programme. We are often led to believe by media reports that it is a patronising clapping us on the back for our performance. That is not the message I get. Any member who has contacts through COSAC or with parliaments in other member states knows that is not the case. We are deeply respected. We have gained respect in the past 18 months. I am just back from Slovakia. I visited Bratislava on Monday and Tuesday. It is a like-minded member state. It is a small country with a new government and a similar approach to taxation and other issues. We have a lot in common. I had a constructive day and a half there engaging with the new government and meeting my counterpart. We must continue to build on those contacts. The one thing they kept saying is that Ireland is doing so well, that they respect the effort we are making. They do not underestimate the pain that has been inflicted, the sacrifices that have been made or how difficult it is but they respect it. That is the view all across the European Union. We can capitalise on that and use the respect to our advantage in the build-up to and during our Presidency. It makes us a powerful broker in key negotiations, first, on the MFF which I will be back to discuss in more detail next week and, second, on the eurozone crisis, and on all of the legislative initiatives that will flow from the MFF, be it CAP, fisheries, cohesion or whatever else. There is great potential for us as a small country.
The third point is our record. Previous Governments of all colours in this country have done the country proud with the Presidencies that have been run. Everyone says to me that they remember fondly Presidencies in the 1990s or the 2004 Presidency. Some people even remember our first Presidency. I was not born. We have gained respect over the years by running efficient, impartial, honourable Presidencies. We will do the same next year. I look forward to coming back to the committee to have a full session on our Presidency preparations in the near future. I think I have addressed all the points made.
A number of colleagues have just joined us. Perhaps they would like to make a contribution.
I apologise for being late. I was delayed.
That is not a problem. Does Senator Healy Eames wish to comment?
I would appreciate that. The Minister of State, Deputy Creighton, is very welcome. I apologise for arriving late. We had a number of votes in the Seanad and I will be rushing off soon to speak on the Credit Guarantee Bill.
The Minister spoke about our brokering power and our power to influence in Europe. I am here to make a point on which I would like to hear the Minister's response. I believe we need a long-term plan for the euro. Even a country like Greece, which was in and then out again, so to speak, has now voted for the euro. It is time we all put our full weight behind the euro, which is our currency. More important, the message must be sent to the leadership in Europe, and to our own leadership, that a piecemeal plan is not working. We need a long-term plan for economic peace. We need at least a ten year plan. I would like to hear from the Minister what is the ten year plan to save the euro. We are constantly in crisis mode. That might have been necessary to ensure that people realise what they have to do now but it is time for that crisis to be over and for us all to put our heads together and broker this economic peace. We need political vision in Europe such that we have not had for a very long time. The majority of people believe the onus for that is on Dr. Merkel but she does not appear to have that and therefore that political vision must come from wherever it can to provide the inspiration and leadership to lead us towards a long-term economic peace plan. Where does the Minister see that coming from? Does she see it happening? Are we at the point now where that will happen? I am keen to hear the Minister's views on that.
I am sorry I missed the first presentation. Like Senator Healy Eames, I was in the Seanad and was unable to get here any earlier.
In terms of the European Council meeting and the new compact for growth and jobs, an issue I raise at various meetings and in any fora where I get the opportunity to do so because it is very important, is youth unemployment. President Barroso sent the youth action team to Ireland earlier this year but we have yet to see anything come out of that. I assume that addressing youth unemployment will be a pillar of the growth and jobs agenda, and rightly so, but months after the team visited our shores the Commission's own report had an asterisk beside Ireland's figures which noted that since Ireland had no unallocated Structural Funds in the current programming period, the fact that the amount reallocated is higher than the amount initially estimated to be available is explained by the reprioritisation of certain activities.
In terms of dealing with youth unemployment, why are we still hearing soundings about the reallocation of Structural Funds when ours are already spent and obviously cannot be part of our economic stimulus? What are we doing to address youth unemployment? For example, what plans were brought by Ireland when the action team came here?
On a European level, what will be discussed to address youth unemployment? I am aware that next week in the Parliamentary Assembly of the Council of Europe a report will come forward for discussion on the way the financial crisis affected the young generation. One of the proposals will be to ensure that youth policies are put high on the political agenda and that they receive adequate funding. That is one of the recommendations. I ask the Minister about the mechanisms to address youth unemployment and how they will form part of any compact for growth and jobs, given that youth unemployment here is at 30%. That is important given that 70,000 young people are finishing their leaving certificate, which is the same number of people who are emigrating every year. I know the Minister will be discussing the multi-annual financial framework, MFF, with us in the coming weeks but I would like to hear her view, or that of the Government, on the inclusion of the macro-economic conditionality on Structural Fund payments into the MFF.
I have answered both of those questions already and do not propose to labour them. Regarding Senator Healy Eames's question about a long-term plan, I answered that question in replying to a question from Deputy Mac Lochlainn. I spoke about the three pronged approach at the summit and, more generally, in European policy making in trying to address the challenge that exists from the growth perspective, and directly linked to that is settling the eurozone crisis.
I asked about the role of Chancellor Merkel in giving that leadership.
She is one leader out of 27. She is one of 17 in the eurozone. In talking about our preparations for the Presidency and the opportunity we have I made the point that we have great capacity and scope to assist in providing leadership at a European level by building alliances and coalitions with other small member states. That gives us a unique opportunity.
The reality is that, traditionally, since the foundation of the European Union the anchor leadership has been from France and Germany, and I do not see that changing. They are the two biggest economies, and we need their buy-in and their engine to drive the changes that are required. I have addressed this issue already. We may have differences of opinion on some occasions with one or both of those countries but we must find common solutions and arrive at a consensus.
Just because the German Government does not agree with everything we are proposing does not necessarily mean we should beat them with a stick. We have to understand where they are coming from and their concerns. We must remember that in some instances countries joined the eurozone on the basis of falsified accounts. That is the reality. Figures that were provided were not accurate and factual and therefore there is a deep suspicion in certain countries, especially creditor countries, and the biggest creditor country is Germany, which has paid into the European budget for the past 40 or 50 years. It has funded the Common Agricultural Policy and cohesion funding going back many years and will again pay the biggest contribution into the new multi-annual financial framework. It has paid the most into the EFSF and the EFSM, and will pay the most into the ESM.
There is an obvious national self-interest in all of that for every member state but the point must be made that if we want to persuade people we must bring them along with us, and we must understand where they are coming from. I do not agree therefore-----
But-----
Please allow the Minister to finish her point because Senator Reilly asked questions also.
-----in engaging in a collision course at any stage. We must persuade the leadership in the creditor countries that it is in their interest, which it clearly is, to engage-----
I am talking about the common ground.
-----in more comprehensive and long-lasting solutions to the currency union.
I spoke earlier about the move towards closer fiscal co-ordination and co-operation and the move towards a banking union, of which the Government and I are very supportive, but we have to see the clear proposals that will be on the table. President Van Rompuy will bring his proposals on behalf of the member states to the Council. We have not yet seen a draft of that paper. It will be presented to us in advance of the General Affairs Council on Monday and will form the basis for a strategic discussion at the European Council on Thursday. It will be a blueprint for movement in that direction to find much more long-lasting solutions to the eurozone crisis. That brings me back to the Senator's ten year plan, which is what that will be.
On the question about youth unemployment, in my response to Deputy Mac Lochlainn I mentioned that there are specific proposals on the table from the president of the European Investment Bank, Werner Hoyer. We will have an informal dinner with him on Monday evening in Luxembourg during which we will be able to flesh out more of these issues. The proposal is that an additional €10 billion in capital will be paid to the EIB which would enable it to provide up to €60 billion of additional financing for growth promotion in member states. That could then be leveraged up through private financing to about €180 billion, and one of the key focuses of that will be on youth unemployment. That is an early proposal. We will have to go into the matter in more detail. I will have an opportunity in our discussion on Monday evening to get an insight and more detail of what is envisaged and what might be possible. We will have to examine the opportunities for Ireland and how we can identify projects. There is a specific reference in the proposal from the president of the European Investment Bank to investment in the provision of support for training and education for young people and in education and training facilities to improve Europe's human capital and facilitate a return to employment. This is very much to the forefront in the thinking of the EIB, which is very helpful. It is quite unusual that it is putting this issue on the table in advance of the European Council.
On the multi-annual financial framework, MFF, and macro-economic conditionality, I have some reservations. In theory, we have to have incentives for member states to comply. There is always a moral hazard issue, but it cannot be applied too stringently or over zealously. I have expressed concern about this at previous General Affairs Council meetings. We will have a clearer picture over the course of the summer of how it will manifest itself in the next draft in the negotiating box, but while in theory it has merit, we must be careful to ensure it does not cut off potential funding to countries that need it most. That is my caveat.
I thank the Minister of State for her contribution. I understand she will be before the committee again next week and we look forward to her visit.
Yes; me too.
Fly safely in the meantime.
That is a given.
The joint committee went into private session at 12.42 p.m. and adjourned at 12.45 p.m. until 11 a.m. on Wednesday, 27 June 2012.