Private Business. - European Communities (Amendment) Bill, 1992: Second and Subsequent Stages.

Question proposed: "That the Bill be now read a Second Time."

Today we have the opportunity to consider the European Communities (Amendment) Bill, 1992. The passage of this Bill is one of the requirements necessary to allow Ireland to ratify the Treaty on European Union. The Bill is required because certain provisions of the Treaty on European Union must be made part of the domestic law of the State.

As Senators will be aware, Ireland has undertaken to ratify the Treaty on European Union by the deadline envisaged in the Treaty, that is, 31 December 1992. We held our referendum on 18 June and the Treaty was endorsed by a very large majority of the Irish electorate. The President signed the Bill into law on 16 July. Yesterday, the Bill completed its passage through the Dáil. The Dáil also agreed a motion approving the Treaty on European Union which was required under Article 29.5 of the Constitution to allow ratification of the Treaty. The Seanad is being asked to complete consideration of the Bill today to enable the deadline of 31 December to be met.

In other circumstances we could have enjoyed a longer and more leisurely consideration of this Bill, but I am satisfied that since the signature of the Treaty on European Union in February the major issues involved in Ireland's membership of the European Union have been debated frankly and intensely. In particular, the referendum campaign in this country allowed detailed consideration of the terms of the Treaty and of Ireland's future role in the European Union. It allowed many of the fears of the future that inevitably will be raised to be aired and addressed. The European newspaper concluded that Irish people were well informed about the Treaty in a recent survey. This is not surprising given the level and intensity of the debate during the referendum campaign.

Senators may wish to have an idea where other member states of the European Community stand in relation to the completion of their respective ratification procedures. To date, Luxembourg, Greece and Italy have completed their ratification procedures. France is in the process of depositing its instrument of ratification with the Italian Government. Of course, Senators will know the situation in Denmark, of which I will speak later, and in the UK. In Belgium the Treaty is being discussed in Parliament at present and formal ratification is expected shortly. In Germany, parliamentary consideration is underway and ratification should be concluded before long. In Spain, following a vote in the Lower House on 29 October, the Parliament will meet later this month to give formal approval to the Treaty. In The Netherlands and Portugal parliamentary discussions are likely to continue to December.

In Ireland, one of the necessary steps to allow ratification of the Treaty on European Union is passage of this Bill through the Oireachtas. Certain provisions of the Treaty must be made part of the domestic law of the State. The provisions are those which affect the European Community Treaties. As Senators can see, section 1 (1) of the Bill makes provision for Titles II, III, IV and relevant parts of Title VII to be made part of the domestic law of the State. Title II contains provisions amending the Treaty establishing the EEC; Title III amends the European Coal and Steel Community Treaty; Title IV amends the European Atomic Energy Community Treaty.

The final provisions of the Treaty on European Union are contained in Title VII. Certain articles of this Title are provided for specifically in this Act and certain others are not. Where the Articles provide for action under the Union and not under the Treaties establishing the European Communities, a reference in the European Communities Act is not required.

Section 1(2) of the Bill provides a Table setting out the complete list of the "treaties governing the European Communities". Since the passage of the European Communities Act, 1972, amending Acts have been adopted by the Oireachtas on six occasions.

Section 1 (2) of the Bill amends section 2 of the European Communities Act, 1972 and provides for "bodies competent" under the European Communities Treaty. Senators will recall that the Eleventh Amendment to the Constitution made provision for these "bodies competent". The reference is to "bodies" which will not be "institutions" of the Communities. These are the European Central Bank and the European Monetary Institute.

As Senators are aware, the institutions of the European Communities are defined in the Treaties as the Parliament, the Council, the Commission, the Court of Justice and the Court of Auditors. Prior to the Eleventh Amendment of the Constitution the legislative powers of these institutions only could have legal effect in Ireland. Following the referendum, and provided for in section 2 of this Bill, measures taken by the two bodies defined in the Treaty on European Union may have legal effect in Ireland.

I have already referred to the situation regarding ratification in the other member states of the European Communities. I would like to refer, briefly, to the position in Denmark. As Senators know, the Danish people voted against the Treaty by a narrow margin in a referendum on 2 June. Last Friday, the Danish Government presented the member states with proposals for an arrangement which would enable it to put the question of ratification to the Danish people. We are in the process of considering these proposals. In our consideration we are taking the following concerns into account: our interest in seeing the Treaty on European Union ratified and in operation at the earliest possible date; our willingness to help Denmark, so long as the steps taken uphold Community achievements and do not impede the dynamics of integration, and our commitment to no opening of the text of the Treaty as has been affirmed by the European Councils of Lisbon and Birmingham.

Later this month the Foreign Minister of Denmark, Mr. Uffe Elleman Jensen, will be in Dublin to discuss these proposals. It is in everyone's interest to find a solution to the problems posed by the Danish vote and I look forward to Ireland making a full and positive contribution to the forthcoming negotiations.

There are a number of issues where the attention of the Community has focused recently. I have described the situation with regard to ratification in the member states and the current position on Denmark. There are a number of other issues, some of which were discussed at the Birmingham Summit last month, to which I would like to refer.

As Senators know, the importance of stability of exchange rates for the smooth functioning of a common market became very clear during the past few months. As a small open economy, Ireland knows the cost and barriers created for all by the different currencies. Our exporters experience acutely the problems of currency fluctuations. It is a measure of the progress we have made in recent years that our currency has maintained a strong position in the ERM in spite of the fall in the value of sterling. Ireland intends to be in the first group to move to full monetary union.

Structural Funds play a key role in helping to bring the less developed regions of the Community up to the Community average. The Treaty on European Union provides that these will be reviewed and that a new Cohesion Fund, specifically for the four least developed member states will be established. The Commission's proposals on future financing of the Community, the Delors II package, include provisions for the doubling of funds for these cohesion countries. We are looking forward to the Edinburgh European Council in December when decisions on the future financing of the Community will be taken. The aim is to have the Cohesion Fund in place early in 1993.

Another area being examined at present in some detail is that of openness and subsidiary. It has become clear, since the signing of the Treaty of European Union in February, that the Community must make a grater effort to inform its citizens of the work which it does on their behalf. For example, the Maastricht Treaty has been described as a "user unfriendly" document. There is no doubt that out of context it is difficult to understand. If sufficient time and energy is spent in analysing and discussing its different provisions and implications it can be understood, but I think that in future the Community will have to make a greater effort to present its legislation more clearly.

In producing the White Paper, the short guide and the other informational material provided in the run-up to the referendum in June the Government aimed to make the Treaty accessible. We are continuing our efforts to demonstrate the benefits of the Community and of the Treaty on European Union. There is a plethora of complex policies and programmes which are vital to Irish interests and which are familiar to only a few people. There is a great need to encourage more people to become involved and active in the issues of fundamental interest to us such as, the Common Agricultural Policy, the Single European Market, the GATT talks, the Structural Funds and Environment Policy.

Our views on subsidiarity were made clear at the Birmingham European Council. We supported the insertion of the principle in the Treaty of European Union. Subsidiarity can be a positive principle which helps guide the formulation of Community legislation but we do not agree that the principle of the Treaty on subsidiarity should be implemented at the expense of the existing institutional balance. We do not agree that subsidiarity should be a kind of code used to undermine the status of the Commission or the achievements of the Community to date.

As Senators can see from the European Communities (Amendment) Bill, no provisions are made to cover Title V or Title VI of the Treaty on European Union in this legislation. Title V concerns provisions on a common, foreign and security policy where no requirement for domestic legislation is envisaged. Title VI concerns provisions on co-operation in the fields of justice and home affairs. Legislation may be required at some stage in the future to cover some of the articles in this Title. However, no legislation is required, nor would it be appropriate, at this stage to cover the provisions of this Title.

Closer co-operation in the area of foreign policy and on justice and home affairs is an essential part of this Treaty. The Community has yet to develop to a point where foreign policy and justice and home affairs matters can be the subject of full Community decision-making. We have not reached the same level of development in these areas as has been reached in the economic and monetary field. Nonetheless, the Treaty represents a valuable step forward.

Decisions will still be taken by the member states by consensus. Implementation will be by national action and not by directly applicable Community legislation. Nonetheless, the new arrangements for foreign policy and justice and home affairs co-operation will allow the Twelve to act together more effectively than has been the case to date.

International conditions today require a strengthening of the mechanisms through which the Community develops common approaches in the foreign policy field. From Ireland's point of view, an active forward-looking role for the Community gives us an additional opportunity to promote values for which we have traditionally stood on the world stage — the rule of law, respect for human rights, support for the United Nations, disarmament and the responsibility of the international community to address the problems of poverty and underdevelopment.

The provisions of the Treaty dealing with justice and home affairs represent also a significant development. The challenge to the Community is to devise ways and means of generating greater economic activity, removing barriers to trade and the movement of people, goods, services and capital so that the people of Europe can benefit. We must ensure also that as we remove these checks, alternate systems to detect criminal activity are in place. The Community must ensure that its great achievements are not exploited by the criminal elements of society. The provisions of the Treaty on justice and home affairs allow us to do this.

Finally, there is one other element I would like to address today. The Community is not a static organisation. Already a number of countries have applied to join the Community/Union. The Lisbon European Council agreed that the interested EFTA countries were in a particularly strong position, following the European Economic Area Agreement, to pursue their case. It was agreed at Lisbon that official negotiation could begin once the Maastricht Treaty has been ratified and the Delors II package has been agreed. We look forward to the realisation of this step with the EFTA countries with which Ireland has excellent relations.

As for other possible applicants, the Treaty on European Union provides that any European state whose system of government is founded on the principle of democracy may apply to become a member. We look forward to further enlargement when the economies of the former eastern European countries are sufficiently developed to allow for the obligations of membership. In the meantime the Community will continue to develop the range of relations it has with all its European neighbours.

I look forward to the debate in this House today. The issues involved in this Bill are important. Discussion in this House represents the culmination of a major national debate which, given the vital importance of the issues involved, rightly involved the people in the June referendum. Our approach to the Community has been reinforced and enhanced by the national debate over recent months. I am sure the discussion here today will be a further important contribution.

I would like to welcome the Minister back from his travels in Australia and Somalia and to compliment him, and the President, for doing an excellent public relations job for Ireland. I would also like to thank him for coming to this House despite the busy schedule he has at the moment, given all that is happening. I sincerely hope we will have an interesting debate here on this important issue.

As the Minister said, the passage of this Bill is one of the requirements necessary to allow Ireland to ratify the Treaty on European Union. We had a referendum earlier this year and the Irish electorate indicated, very strongly and enthusiastically, their ambition to be part of European Union. The Danes, by a small majority voted against it but we should recognise that they were in an entirely different situation from Ireland.

In the first place, they are net contributors to the Community budget while we are among its biggest beneficiaries. Secondly, with regard to market, they are located ideally within the Community, between the Community and Scandinavia and between the Community and eastern Europe. There were many other reasons for their decision; they have the highest standard of living in the Community whereas we have one of the lower standards. Failure to ratify the Treaty did not hold the same kind of threat to the Danish economy, and to their prospects of developing their economy, that it held out for Ireland. The Irish electorate understood this and gave the Treaty very significant support in that referendum. I am glad the Minister cleared up the situation with regard to the member states who have ratified and are about to ratify the Treaty.

I note that the Minister referred to the new bodies or "bodies competent" that must be included. These are, primarily, the European Monetary Institute and the European Central Bank. The European Monetary Institute will precede the Central Bank and when that happens we will undoubtedly have to bring our economic and monetary policies more into line with the rest of Europe. We have been progressing towards that. When the European Central Bank is in place, we will lose whatever autonomy we have, which is not very much in terms of monetary policy. We are a country that never enjoyed much autonomy in that respect. Up to 1979, we fell into line with the British Central Bank.

After we joined the EMS and the ERM, our room for significant changes in monetary policy was constricted. I do not regret that. When it comes to vote getting we have shown that we can be a little irresponsible as far as economic and monetary policies are concerned. The Germans particularly have always had the good fortune of having an autonomous central bank and Holland has virtually an autonomous central bank and as a result politicians were forced to do what was economically correct rather than what was popular.

I will give an example of how that has worked out for these countries versus Ireland. I studied in Germany and Holland in 1960. I was getting 10DM to the £ in 1960, today I would get about 2.5DM to the IR£; I was getting 8 guilders to the £, today the exchange rate is about 2.9 guilders to the IR£; I was getting 19 kroner to the £, today the rate is about 10.4 kroner to the IR£. That is a measure of how successful their economies have been and how unsuccessful we have been because we were too closely linked to the British economic and monetary policies which have been a failure. Since the Second World War, Britain has been in trouble when it came to their competitiveness, and their solution to their problems has always been to take the easy option of devaluing. That is just a quick fix solution which leaves you in a worse situation. Their exchange rate is down from DM10 to the £ sterling to DM2.4 to the £ and still they are unable to compete. People need an autonomous central bank to impose the kind of discipline that, seemingly, politicians and people do not want to accept too readily.

We have seen the havoc that can be caused by disturbance in the markets. Ireland was not forced to devalue but many people in Ireland are suffering, have suffered and will suffer as a result of the devaluation of the £ sterling against the IR£. Some people working on very tight margins, who imported little or nothing from Britain and exported almost their entire production to Britain, have suffered a very serious loss of income which they will not be able to sustain.

I am thinking in particular of the mushroom producers who, through their technology and their own excellent efforts, found an alternative farm enterprise which was so successful that in a short number of years, they managed to capture 35 per cent of the British market. These people import very little from Britain but they worked on tight margins. Their prices have dropped by 15, 18 and sometimes 20 per cent. They cannot sustain that situation. Hopefully when the markets settle the price of mushrooms will rise in Britain and these will survive as they deserve because they have been an example to all of us. They were caught in a situation which was not of their making. This is a classical example of what monetary instability can do for industry.

However, there are many other reasons we need a single currency and a single bank. We are paying interest rates which are far too high. Our interest rates are high to defend our punt. Our inflation rate is lower than that of Germany but our interest rates are much higher. That is happening because we have to keep the punt in the country by paying premium interest rates.

Interest rates are crippling industry. They are also weighing heavily on mortgage holders. Sadly, listening to this morning's news, I heard of one person in Sligo, whose house is being repossessed, who committed suicide yesterday. There are orders going out from finance houses to repossess homes and that is very regrettable. Something must be done to delay the repossession orders and to help these people who have been caught by this surge in interest rates due to monetary instability.

Working in different currencies adds a huge cost on industry. The cost of currency exchange is frightening. Of course, the banks do not want a single currency because they would lose all that income. I have quoted a case before of an exercise which a colleague of mine, who was in the European Parliament when I was there, did. He went to his local bank manager, changed his money from sterling into the other 11 currencies and back into sterling. He got back 46 per cent of what he started out with having achieved nothing except keeping the bank manager happy. That practice is detrimental to industry.

There are other aspects too, like the risk factors, which deter industry from investing and expanding. There are the administrative costs of working in different currencies. There are many more problems associated with it and we must find a way of getting over this instability, and of getting a single currency, whether that will happen in this century I am not sure, because of what happened recently. Because of the devastating effects of monetary instability, governments may decide to introduce a single currency as soon as possible.

We cannot avoid the fact that when there is a single currency we will have to bring the economic and monetary policies of the 12 member states more closely into line. Otherwise, the strains, stresses and hardships will be too much to bear, particularly in the poorer areas.

The Minister mentioned economic and monetary union and cohesion. The Cohesion Fund is a non starter if the Union is not ratified by all member states. In that respect, I am particularly happy to see the Minister is willing to help the Danes and, as far as possible, solve their problem. They are a great people and it would be a pity for Denmark and for the community as a whole if they are unable to solve this problem.

Our nearest neighbour, too, has a problem. They always had a problem accepting that they were part of the European Community. They never really got over the shock of losing an empire. As Dean Acheson said, they lost an empire and have not yet found a role. Claud Cockburn I think, put it more aptly, when he said Britain is now too small for its shoes. It is time they gave up the big boots and realised they need smaller shoes to play a smaller role in what is going to be a very important economic bloc on the world stage. Britain can play if they get it into their heads that they can no longer go alone, if they pull together, ratify the Treaty as soon as possible, try to fall into line with the more successful economies and adopt the policies of the more successful economies in the Community.

I am glad the Minister referred to openness and subsidiarity. This word appears again and again. It means different things to different people but one thing is clear, there is a need throughout the Community to have a better understanding of how the Commission functions. There is also a need for the Commission to cease making fools of themselves at times. We now have a serious proposal from the Commission. At a time when we are getting rid of passports in the Community, they are now suggesting passports for cows. They suggested that every field in the Community be numbered and that a geostatic satellite overhead watch what we do and what crops we plant.

This is the kind of nonsense that ridicules the Community — regulations about the size of a tomato or the Euro sausage or more recently the suggested banning of a chemical that is added to feedstuffs, particularly for flamingos which they need to retain their natural pink colour. The list is endless. EC civil servants must be thinking of the weirdest and daftest schemes and they will cause the Community to be held up to ridicule, scorn and question. We must get away from that as the Minister said to a more open and transparent kind of Community.

The document produced in relation to the Maastricht Treaty was user unfriendly; that is the mildest possible expression I could use. I do not know anybody who read it carefully except for those adamantly opposed to any form of union and those adamantly in favour of one. Everybody else gave up after about Chapter II, including many Members of the House of Commons who admitted openly that they had never read it. It was exceedingly difficult to read.

Members of the British Government said that they had not read it.

Surely there must be some way of phrasing the contents of that document so that it may be understood without one's having to work exceedingly hard at it. The Minister also made reference to our fundamental interests under the Common Agricultural Policy, the Single European Market, the GATT talks, the Structural Funds and the environment policy and I am concerned about where the Common Agricultural Policy might be going.

Agriculture and fisheries are our only natural resources and they were very undeveloped when we joined the Community. They developed reasonably well for a period after joining and then suddenly quotas were slapped on us and we have been frozen since in a developmental state significantly lower than that of richer member states. In the same breath the people who have condoned this are talking about cohesion and the levelling up of standards. How can we attain higher levels if our two most important natural resources are frozen at an inferior stage of development? It is impossible and no amount of Structural or Cohesion Funds will compensate us for the disadvantage.

We have 16 per cent of the Community waters but about 3 per cent of the fishing quota only. We have a milk quota equal roughly to one-eighth per hectare of what the Dutch have. Prior to the imposition of quotas, we had a comparative advantage in European milk production. How can that be classified as fair?

The reform of the Common Agricultural Policy punished Ireland more severely than any other EC country because it imposed punitive restrictions on our two main products, beef and milk. That was wrong and it is hypocritical of Community leaders to talk about cohesion and reducing differences while at the same time preventing us from providing what we can. I feel sad that farmers who could produce a good living if given a chance are going to be dependent on a cheque in the post, on compensatory payments.

I compliment the Minister, Deputy Walsh, who improved the deal we were getting out of all recognition but it is still in the form of a cheque in the post that depends ultimately on the willingness of Community taxpayers to continue contributing. I do not see that lasting. Community taxpayers will begin to ask whether that money would not be better spent on health, housing or education but above all on job creation.

Millions of people in the EC have lost jobs in steel, car manufacture, ship building and other industries for the same reasons as farmers, namely, new technology, increased imports and changing market requirements, but they received more than normal redundancy payments or whatever was worked out and no subsequent payment other than unemployment assistance. They will inevitably ask why farmers should be better treated than all other workers. Taxpayers are willing to make certain sacrifices so long as farmers remain on the land and do not swell the numbers of unemployed in cities and towns. This measure will not succeed in doing that. It may slow the farmer exodus but it will not prevent it and when Community taxpayers learn that they will quickly object. Politicians will reply, "I am sorry. We made the agreement but". While all this is going on, wealthier countries, such as Germany, are paying their farmers and helping them in all sorts of ways that would be construed as a renationalisation of the Common Agricultural Policy.

With regard to the Single European Market, there is much to be gained by industries that can survive. This morning it was announced that Adidas in Cork will be closing because of the Single Market. For industries capable of surviving and who are really competitive the advantages of the Single Market are huge but they must begin to prepare for it and those who had not begun some time ago have probably missed the boat.

With regard to the GATT talks it seems we are damned if they fail and we are damned if they do not fail. On balance, it is more important that they succeed but the outcome is likely to pose a serious problem for us. Our exports of agricultural products, particularly milk and beef products, are heavily dependent on export refunds and Third World markets and if there are cut backs, our processing industries will be in serious trouble with consequences for farmers, employment and the general economy. Other industries will also be affected, such as the textile industry which employs about 22,000 people. If there is free access to the Community for materials from low cost, cheap labour countries, such as Turkey, Malaysia, Hong Kong, Singapore, Taiwan, etc., our textile industry could be in serious difficulty.

The Structural Funds are very welcome and I hope the renewed Structural Funds will be significantly greater than the funds running out in 1993. Not for one moment, however, during the Maastricht Treaty debate where I advocated ratification did I believe or say that we would get a doubling of £6 million. Whatever chance we might have had of achieving that has been blown by events in Germany and particularly by the cost of German reunification. I doubt if there is any prospect now of a doubling but I wish the Minister luck in trying to get as much of an increase as possible. We will, of course, have the Cohesion Fund, although the size of that has not been determined.

I am in favour of closer co-operation on foreign policy and on justice. The Community has developed into an economic giant but it is still a political mouse.

And rightly so.

It could have exerted substantial influence on peace keeping efforts in the former Yugoslavia as well as elsewhere. Its influence on peace keeping has been insignificant. If we had had a common peace policy Germany might not have stepped in so quickly urging recognition or Croatia and Slovenia and fewer problems might have resulted.

On our eastern flank we face serious and dangerous situations and not only in former Yugoslavia. Some republics in the former Soviet Union are in danger of civil war between ethnic groups and these parts of the world hold large supplies of nuclear missiles. A conflagration originating there could result in a serious world situation. Europe stands looking at the scene, impotent, whereas if we could agree on a common stance we might exert some influence there.

The Minister also referred to the removal of barriers to trade and the free movement of goods, services and capital. That certainly has advantages but there is a down side to everything and one that I have been conscious of for some time is drug smuggling. Once you do away with systematic border checking we must seal the perimeter to keep out drugs. How do you seal the coast of south Cork and Kerry with our resources given all the inlets there where small boats might land goods which can then be transported unhindered throughout the Community? The State Solicitor in Cork said that there has been a considerable increase in drug trafficking there and recently one of our new residents in Kerry was arrested as a drugs baron in Holland. This is a serious problem and will have to be faced. The most effective way to do so is to get EC help for aerial surveillance, boat patrols and other measures because we do not have the resources necessary to patrol our most difficult coastline. It is in the interest of all EC countries to prevent drugs arriving illegally in Ireland and I suggest that this matter be taken up again in the strongest possible way with our European partners.

No reference was made to an institution of which I was a member for some time, namely, the European Parliament, nor to the democratic deficit. People in Europe want increased democracy and more transparency in decision making. The Council of Ministers should reveal how decisions are arrived at. People become suspicious when facts are concealed; when they are revealed people quickly lose interest.

Some years ago I was at a European Parliament Committee meeting where Dr. Lester Crawford of the Food and Drug Administration of the United States gave evidence on a hearing on the hormone issue. He was asked what confidence US citizens had in the FDA and he said that the most recent opinion poll in 1988, had shown 70 per cent confidence in the FDA. If one conducted a survey in the European Community what confidence would people register in, say, the health protection mechanisms or regulations of the Departments of Agriculture or Health? We saw what happened in Britain when the Junior Health Minister there said that every egg in Britain had salmonella. The Minister for Agriculture, Mr. McGregor, denied this but people in the street were more inclined to believe the Minister for Health and the egg industry was decimated not only in Britain but in Ireland also. People have no confidence in such statements.

Dr. Crawford was asked why there was such confidence in the US FDA but not in the Community about Commission regulations and regulatory authorities in member states and he was taken aback by the question. When he had thought about it he said that was probably on account of US openness where anybody can walk in off the street to the FDA, go through the files, photocopy material in relation to approval of a drug or other substance and walk out again. He thought that that was probably the main reason for confidence. Anybody could examine their methods, results and recommendations and no attempt was made to hide what they were doing. He said that people showed little interest when procedures were open. Europe should introduce greater openness and transparency. In relation to the democratic deficit the European Parliament will have a large part to play in future in persuading people that they have a say in matters. I hope that Ireland will see it that way.

I have always felt that the briefing MEP's received — and this occurred under two Governments — was deplorably bad. It was not too serious before the Single European Act but after that, when we acquired powers to influence legislation through amendments to Community directives, we still received the same inadequate briefing on the day of the vote in Parliament but by then it was too late. We needed briefing during the First Reading, on Committee Stage and certainly on Second Stage; to receive briefing when the Parliament was about to vote was closing the door after the horse had bolted. The work was finished then and parliamentarians at that stage were not going to amend anything — or only very rarely.

The Minister also referred to the enlargement of the Community to include countries in Eastern Europe which I favour. Enlargement has to have the approval of a majority in the European Parliament which is another reason that Parliament will play a more important part in future. I remind the Minister that some Eastern European countries are going to present serious problems for us in the area of agriculture. East Germany, Poland and, possibly, the Ukraine are making noises about applying and if included we will have another kind of headache to contend with in terms of supply and competition. These countries in certain products, have competitive advantages over us that will create problems if they join.

Nevertheless I favour making the Community as open as possible and in the meantime welcoming the EFTA countries who will be net contributors to the budget, who are paying to get into the European economic arena and who will help to bring up the general standard of the economies of the European Community. After that we will have to tread warily and make the Community more united and firmly established before we take on more members.

I would like to take this opportunity to welcome the Minister for Foreign Affairs to the House and to congratulate him on the excellent work he has been doing here and internationally. In this country the Minister for Foreign Affairs — after the Taoiseach and possibly the Minister for Finance — is the most crucial Minister and as matters progress and develop in Europe, Foreign Affairs becomes one of the most crucial posts in the Irish Government. This is especially true at the moment when crucial decisions are necessary on Maastricht and on the North of Ireland. It is an extremely important and responsible position.

The matters we are considering in the Community are vital to this country. We are entering an open economy of 300 million people. One of the major implications of this — and the Minister has played a major role here — is the increased openness of Irish society. Not only has the Irish economy been transformed but society has been transformed for the better. Change brings good and bad, but I hope for better and greater exposure to the wider European world.

As the Minister said, this is the culmination of a debate that took place here and among the Irish public. Most people have taken a close interest in Maastricht and in European Community developments. It is appropriate that there should be informed and detailed discussion and that ratification should be a democratic decision. We have accepted it overwhelmingly in both Houses and we hope for a large majority among the people. That is right because democracy is an integral part of the EC and a requirement for membership of the Community. It is right and proper that we have had a series of debates and a referendum in which we have clearly and unambiguously made up our minds in favour of the further development of the Community.

That does not mean that we do not respect the Danish view. Our democratic outlook enables us to respect the Danish people's right to make their views and reservations known. As a small country we understand some of their reservations as regards sovereignty and various other matters. Their historical background is that of a nation situated beside a major power growing stronger day by day.

In coming to some agreement with the Danes, our Minister in meetings with his Danish counterpart may be able to help advance the clear wishes of the Danish Government and people. There is no antagonism there towards the EC but there is concern about some aspects of the Maastricht Treaty as presented and other relevant matters. It is going to be important for our Minister and the Danish Minister to find a mechanism which will enable the Maastricht Treaty to proceed.

There are all sorts of deep emotions involved, as we have seen in the UK; there is an almost schizophrenic attitude there in that many people there are probably opposed to European ideals. They feel emotionally antagonistic to the idea of coming closer to the French or Germans while, at the same time, acknowledging the crucial importance of the United Kingdom economy with all its drawbacks staying in the EC. They would admit also that it is essential to continue building closer associations with other aspects of Europe if they are not to become marginalised and peripheral to Europe.

The British vote last night was very close and it may turn out to be a crucial turning point in the United Kingdom Government's attitude. Regarding the German attitude to Maastricht, there has been much criticism of the European Bundesbank but it is doing what it thinks best for the German monetary and financial situation as it is obliged to do. It was set up by law as an independent institution and has to act accordingly and responsibly. It was Government interference there that caused many of our present problems with their insistence that the virtually valueless Ostmark should be valued at the same level as the Deutschemark.

Let us not forget that the origin of the Common Market was not economic only as regards Germany or France. It aspired towards political union and towards a universal ideal of future peace in Europe. That was the basis of it and the steel and coal industries were an initial modus operandi, a way of working together that gradually expanded into the full-blown European Community of today. Let us not think of it purely in economic terms; there is much more to it than that. We can sympathise with the basic ideals of Adenauer and others who founded the European Community.

There are aspects of the EC that I do not like. Bureaucratic inanities have been mentioned. I do not approve of the removal of the green passport — it is only a small thing but it would have been more tactful to allow us to keep our national passports, but adding some emblem to indicate that we are also European citizens. We have not given up our Irish citizenship, nor do we intend to. There is no need to. There has been unnecessary, unfeeling remoteness and interference by bureaucrats in Brussels who have not been answerable as they would be here, in Germany or elsewhere. If nothing else, the Danes have done us a great service. They have shaken up that bureaucratic "take us all for granted" attitude.

I am unhappy also with the topical subject of subsidiarity. Not even Mr. Delors seems to be able to define it. Our British colleagues seem to be trying to use it to escape from inevitable developments in the Community, or to pretend to be escaping from those developments. The original idea was that as far as possible regional institutions and authorities should carry out functions and that is something which I support. I would not like to see it used by countries trying to evade the Treaty obligations of Maastricht.

In this country we need to be particularly concerned about the role of the European Commissioners. We can criticise them on many counts but they offer de facto protection for smaller countries. I am not saying that we do not have our feet under the table at the Council of Ministers, but the Commission is very important in that it acts for the Community as a whole rather than for one or two powerful nations in the Community. Thus, it is more likely to benefit this country.

Although I support the development of the European Parliament, I have some reservations about it. We have excellent representatives there but the reality is that we will be a tiny minority in that Parliament, and even our tiny minority will be inevitably fissured. The idea of the various parties here and in other countries joining together on vaguely similar ideological lines, or even sometimes totally different ideological lines, is artificial and does not necessarily relate to the situation on the ground. Although I favour the European Parliament becoming more meaningful, we cannot reasonably expect to play a big role there when the Parliament, to a considerable degree, represents populations. We have a tiny population compared to other member states.

One cannot comment on this Bill without making some reference to the EMS and the European Monetary Union. These days the Lombard rate, the discount rate and the Bundesbank are becoming just as important to us as the LIBOR or whatever.

The fact that we have had the financial strength to weather the extraordinary foreign exchange variations of the last few months is a great tribute to the development of our financial institutions and our economy. Nonetheless we are in a precarious position where we are in between having a currency over which we have control to some extent — although less than we imagined — and having a common currency. From the point of view of this country, the sooner we have a common currency the better, otherwise there will always be a risk of considerable financial difficulty.

We have certain economic strengths and let us not forget them. We are in a huge market and must be competitive, but we have succeeded in some ways — some are slightly artificial but nonetheless they represent success. We are one of the few countries that has an export surplus with Germany. We have considerable resources and our greatest natural resource is our people. They are extremely adaptable, able and can compete in most circumstances in which they find themselves. There are additional things which one would like to see but, given a level playing field, we can give a good account of ourselves.

We have other natural resources. I rarely refer in this House to personal areas in which I have some slight involvement or knowledge but I agree with the last speaker's remarks about agriculture and fisheries. However, in relation to agriculture I would put more emphasis on the product rather than the producer. That is not to say that I do not have the greatest sympathy with the initial producers, the farmers, but from the point of view of a strong economy, it is the use we make of that produce, the added value, the sale of agricultural products rather than the "raw beef on the hoof" attitude, which admittedly has changed, that matters. In terms of our economy, we are not focused on the food business. We still think in terms of agriculture, full stop, rather than agri-business which we should emphasise more.

When the Channel Tunnel opens we will be the only island nation in the EC. Yet, we have no merchant navy. We have a very brave, valiant but very small fishing fleet. I have many friends in Norway and they just cannot understand that. It is an area which we need to look at seriously. This Government appointed a Minister for the Marine, an area we need to develop. It is a cultural as well as an economic matter.

I will make one short reference to another natural resource in which I have some slight involvement and about which I sometimes think there is little understanding here, even in the highest financial circles, and that is, our mineral resources. We have at present one of the largest zinc mines in the world. Zinc is one of the essential metals for economic development used to a huge extent in the car industry and the construction industry but it has many other uses. We have the fifth largest mine in the world which is already in operation and certain other mines are in course of planning and, hopefully, will come into operation in the mid-nineties. At that stage we will be supplying between 25 per cent and 30 per cent of the western European zinc market. There is no other commodity in which we come remotely near that in percentage figure.

In the world commodity ratings there are only two commodities in which we rank in the top ten. If you ask higher civil servants, business people or politicians and others what those two commodities are, you will nearly always be given one correct reply and that is dairy products. I am one of those who believe the anti-milk products compaigns have been overdone. We are very lucky to have good quality butter and milk. They are much better for your health than substitutes. Nonetheless to be in the top ten for dairy products, from an economic or financial point of view one, is not one of the best areas to be in at present.

The other commodity in which we rank in the top ten is zinc. Those are the only two commodities in which we rank in the top ten, and that is relying on one mine but the likelihood is that we will have a number of other significant world class mines.

This is probably my last speech in this Seanad. I hope it is not my last speech in any Seanad.

Not at all.

I wish to draw the Senator's attention to the fact that there are two other speakers offering. I hope to make a contribution myself and the Minister will be anxious to address the House. You may speak until 1 o'clock if you wish, but I ask you to bear that in mind.

I will co-operate with the Chair. We have people who can compete anywhere. We have a very rich agriculture base but let us use it in the form of added value and look of it from that perspective. The other main basic source of wealth in the industrial world is metallic wealth. We have the good fortune to have a lot of it, and from all accounts we will have a great deal more, and I hope it will lead to considerable prosperity and development. I support the Bill.

The talk about Europe is becoming extraordinarily peculiar. I have a vision of Europe. I am delighted I am part of Europe rather than part of some of the far less diverse and mixed cultures in the world. The richness of European culture is its diversity of language, cuisine, history, religion and so on. It has many things to be proud of and many things not to be proud of. Colonial history is not something to be proud of but there are many things about Europe, such as the development of the welfare state and the European vision of the market economy that are altogether more humane and people-oriented than what operates in North America. Those are European ideas that, in spite of the best efforts of those who lead our country, we have actually acquired in this country.

The basis for any coming together of the peoples of Europe which is the phrase in the Treaty of Rome — the ever closer union of the peoples of Europe — must be based firmly on the enthusiastic consent of the people. The problem that is developing in Europe is the degree to which devices and tactics are being resorted to in order to rescue the semicoerced agreement of the people for the enthusiastic acceptance of the future.

I will never forget the phrase the President of the European Commission used during the French referendum, when he said that those who opposed Maastricht were the devil's disciples who should either leave politics or change their opinions. I do not think a man who even once resorts to that sort of language has my vision of democracy as his bedrock. I resent it very deeply. As one who opposed Maastricht, I have no intention of changing my opinions and, trusting to the good judgment of the intellectuals of the National University of Ireland. I have no intention of leaving politics. I find that sort of language by a European bureaucrat profoundly offensive.

I was out of the country during the great currency upheaval and during the French referendum on the Maastricht Treaty. I was in Spain. My Spanish is limited but functional and reading Spanish newspapers the vision of Irish influence that is talked about so much here was very hard to find since in terms of all their discussions about European affairs I found two lines in one Spanish newspaper over a period of five days which even mentioned this member state. Every other member state, in particular Denmark, was referred to; whether we have lost any European individual identity or whether we are so insignificant I do not know, but in all the discussions about European concepts and Europe's future at the time in Spanish newspapers and on Spanish television, Ireland and the idea of some sort of common interest between the peripheral and under-developed regions was missing, to say the least. That is where the question of the democratic deficit comes in.

Let us get sorted out. You cannot have half-way democracy. Either you have democracy or you have not. Democracy means that the power comes from the people and other people are allowed exercise it on their behalf under controlled conditions. Anything else is not democracy. For instance when there is talk about letting people, to use Senator Raftery's phrase, feel they have a say in the development of Europe, that is not democracy. That is tyranny making a concession, the sort of thing that the Saudi royal family are thinking of allowing in Saudi Arabia. They are going to allow the Saudi people to have a say.

What we need to sort out in any future Europe is the very clear fact that it is the people of Europe who run Europe and that everybody else, Council of Ministers, Commission and bureaucrats, take their power from the people. They do not gradually and slowly share a little bit of the power they have in these institutions with the people. They fundamentally get rid of any idea that power in Europe comes from anything else other than the people of Europe. That means a total restructuring of the institutions so that most decisions about difficult issues are not made in secret at Council of Ministers meetings, that most preparations for decisions are not made in secret at European Commission meetings. If we in this Parliament were to operate on the principle of how decisions are reached in the institutions of the European Community, in the Commission and the Council of Ministers, we would do most of our debating in secret and would not allow people hear us disagree. We would not allow people to know our position papers nor would we have healthy debate. At that level Europe is inherently anti-democratic because it is secret.

There is a fundamental conflict between secrecy and democracy. There are some things that need to be done in secret for security and other reasons but until the institutions of the European Community become democratic in their spirit, operation and ways of expressing themselves and until it is quite clear that they only continue with the will of the people and not by pressure, threat or institutional devices, you will never have a sense of Europe in the European Community.

One of the classic areas where the European elite have led us up the garden path of anti-democracy is in the'eulogy for an independent central bank. I find the gradually increasing idea that somehow politicians and Governments cannot be trusted with currency profoundly anti-democratic. Where does it end? If the currency must be protected from the politicians, what comes next — the Army, law and order, industrial policy? Why should the whole area of protecting the currency be separated from democratic accountability? Who said it is any better? Who said the principles Europe has established in recent years to which we are adhering at enormous pain are necessarily the best way to run an economy?

Let us remember what has happened in the European Community. Over the 20 years we have been a member of the European Community unemployment has exploded all over Europe and, in fact, has increased more in other countries in Europe proportionately than it increased here. Is it not time somebody looked at the bedrock of European economic policy? It should have been debated during the debate on the Maastricht Treaty and it was not.

Unfortunately, and I say this not as a matter of recrimination but as a matter of record, the conduct of the referendum in this country was a disgrace — there was bullying by, among other people, the European Commission about the consequences, threats about a rapid escalation in interest rates if we did not vote "Yes" were widespread, threats of the loss of large amounts of money were also widespread. I am intrigued incidentally, as a kind of a worthwhile aside, that on the one hand virtually everybody in Government told us about the benefits that would come from the European Structural Funds while, at the same time, the economist the Government appointed to the Culliton Commission is one of the most outspoken critics of the whole idea of Structural Funds and thinks they are a bad thing. The Culliton report, authored, presumably, with the man's economic wisdom, is supposed to be the new bible for development but the same economist who was the author of the Culliton report's economic provisions has scotched the whole idea in writing. He said that all Structural Funds do is encourage public expenditure and that, to his mind, is a bad thing. I would counsel those who are latching on to the Culliton report to be very careful about its economics. They are written by an economist who, in my view, is to say the least slightly eccentric. The fact that he is opposed to European Structural Funds is a fair indication of his degree of eccentricity.

Acting Chairman

The Senator should not mention——

I am sorry. I appreciate that the person is identifiable and I should not have mentioned him. I am sorry but it is difficult when somebody's influence on public policy is so central not to identify the individual.

I wish to talk very briefly about the conduct of the referendum. It was not a model of a democratic exercise. It was a situation in which we were free to dissent. I almost got the impression from certain remarks by the Taoiseach during the referendum campaign that we should be grateful for the fact that we were allowed to dissent, as if this were a concession, but in every other way the freedom to dissent was not reflected in any institutional balance.

I am reminded of the news on RTÉ which carried, like a propaganda beacon one day one headline on every news programme, which was that the Minister for Foreign Affairs had repeated that no economic alternative had been offered to the Maastricht Treaty. I did not think that was much of a news story since he had been saying it for about six months at that stage but RTÉ decided that was the main news. I rang up and said I would offer an economic alternative and I got two and a half minutes on the 1 o'clock news to deal with the economic alternatives to Maastricht. I do not know what anybody else thinks but I do not regard that as democracy. I do not regard it as the way to inform people or educate them but it is most assuredly not a debate about economic policy.

I also have to put on record the distaste of many people at the hijacking of the airwaves by the Taoiseach on the night before the referendum when he used power that should have been used for emergencies to foist his opinion——

The Senator is talking about the Taoiseach.

Is the Senator saying that the leader of this country has not the right to address the nation on a matter of major——

I am saying that the leader of this country is first of all committed to democracy——

The Senator is walking on both sides of the fence.

The Taoiseach has free access to the media to a considerable extent. He has intimidated RTÉ. What amused me in the light of subsequent events was that not only did he have a ministerial broadcast but RTÉ, immediately after it, felt obliged to repeat the broadcast as the main item on the 9 o'clock news just in case we missed it the first time. Then, ironically, RTÉ refused to allow anybody——

Surely they are competent to judge——

RTÉ refused to allow anybody the right to reply formally but they let my colleague, Senator Murphy, appear on the "Today Tonight" programme where he accused the Taoiseach of something and the Taoiseach is now suing him. It is rather ironic that what the Taoiseach is suing my colleague for an accusation that the Taoiseach was dishonest.

Are we still dealing with this Bill?

We were talking about the process by which this Bill came before the House.

The Senator is being mischievous.

I am, and I am glad to be accused of being mischievous. It is my natural role in life in the kind of intellectual——

You are consistently inconsistent.

I am extraordinarily consistent, that is my problem. I cannot duck issues because they make life inconvenient.

I appreciate the problem about time, but without being disrespectful, it was not I who used all the time. The Minister's speech on Denmark, as much of the reporting in this country on Denmark, has been somewhat disingenuous. The present position, as the last opinion poll suggested, is that close to 60 per cent of the Danish people would now vote "No" if the Maastricht Treaty were put to them again. What the Danish Parliament has agreed to is a view on Maastricht which effectively says "no Maastricht" because they said there would be no common defence, no common citizenship and no common currency.

I applaud the decisions of the people of Denmark. Their economy did not go down the tubes, their interest rates did not go through the roof, and there has not been a massive increase in unemployment, which was predicted by the same threatening European bureaucracy I referred to. Since Denmark will not ratify the Maastricht Treaty, the whole process is a charade because the Maastricht Treaty will never come into force in its present form. We will either have another referendum or it will never come into force because we cannot reconcile the irreconcilable.

We are running very short of time. I would like, if possible, to let the Minister speak, Senators Honan and McMahon also wish to speak.

I will take only two minutes because I want to let Senator McMahon and the Minister speak. On a day when we see the cold face of the election looming, we are debating a Bill about the EC. Everybody knows my strong views on being a European but I would put down a marker that we should still hold on to all that is national. I also hope that in the next Government there will be a move forward again. I always thought Europe would play a more positive part in seeing this nation a whole nation.

I want to put on record my sincere and personal thanks to Deputy Andrews, Minister for Foreign Affairs, for the time he has given to this Seanad. Since I came into the House in 1977 I do not remember a Minister for Foreign Affairs — and everybody knows my very close friendship with Deputy Gerry Collins — giving the same amount of time to the Seanad as Deputy Andrews. I thank the Minister and I hope in the next Government he will hold the Foreign Affairs portfolio.

I will now give some time to my colleague, Senator McMahon. We should have decided this morning to divide the time because one Senator took a lot of time but that is not my business.

Acting Chairman

Thank you for your courtesy, Senator Honan.

I want to thank Senator Honan as she could easily have taken up the time available. I fully appreciate that the Minister wishes to speak but I think he can be easily facilitated as we have a break from 1 p.m. to 2 p.m. and if we run a little into that time I do not think anybody will complain.

I would like to be associated with the kind remarks regarding the Minister. I think he has been an excellent Minister and that is coming from a member of an Opposition party. I hope he will have the opportunity some time in the future of filling the position again, not in the immediate future but at some stage.

This has been an excellent debate. It is unfortunate we are restricted by time today because it is a debate that could have gone on in this House for days on end. I felt rather proud, as Acting Chairman, listening to the quality of the speeches here this morning.

I am a European; I want to put on the record of the House that I want our country to be part of Europe. It is well known that I did not vote for the Maastricht Treaty and there were many people who did the same. However, Ireland is the one State that voted overwhelmingly for the Treaty. I would like to have time to deal with the reasons, some of which were given by Senator Raftery and the Minister in his contribution earlier today. Ireland voted for the Maastricht Treaty whereas Denmark did not. We saw last night in the British Parliament that there would not have been a majority if the people had a free vote.

One aspect that went through all the speeches here today was that there must be more openness. I want to see greater democracy. It was said that Denmark did us a favour. Of course they did but why were we not prepared to do it? I believe we voted for Maastricht because of the economic benefits but I do not believe that is what Europe really means. The Europe that we should be looking for today is one with a better quality of life and offering peace among nations. We should not be going to Europe with a begging bowl. Let us hope we have heard the last of this. Let us play our part and make a contribution to a better quality of life in Europe and to peace among nations.

I would love to speak at greater length but I thank the Chair and other Members who have facilitated me in allowing me put those few words on the record.

Acting Chairman

I now call the Minister.

I was not here for the Order of Business and I do not know the timetable.

Acting Chairman

We are due to conclude all Stages at 1 o'clock.

May I have one minute?

I am prepared ta facilitate the House.

I am the last person to stop somebody from speaking. I do not have any trouble with Senator McDonald commenting but we agreed to finish at 1 o'clock and the Minister wants to comment as it is his last day in the Dáil.

Acting Chairman

I will let the Senator in for 30 seconds and then I will turn a blind eye to the clock until the Minister has concluded his speech.

In this country we have traditionally given leadership. What Europe needs now is leadership, but not leadership from the back or from dissidents. Those who are feeling weak at the knees about Europe should take a trip to any of the eastern European countries and look at what nationalism, the curse of the 20th century, is doing.

This country is in a position to give the lead. What is needed is leadership, partnership and hope in the future. I compliment the Minister on the progress he

I am very grateful to the Senators who contributed to this very enlightening and helpful debate. As Senator McMahon said, it was an extremely worthwhile debate and will help me as long as I remain Minister for Foreign Affairs.

I am grateful to Senator Honan who is a dear and long standing friend of mine for her compliments on my performance in the portfolio I hold. In that regard a Minister can be seen to be as good as the advice he gets. I would like to take this opportunity, to put on record my appreciation of the officials who have assisted me in the Department of Foreign Affairs over the last number of months. They have been very helpful, extremely cooperative and, in the best tradition of the Civil Service, they have helped whoever was Minister, and that is as it should be. They were just and fair.

Senator Conroy's contribution was as usual incisive and analytical. He has wide experience in a number of areas. His comments were well made and well taken.

Senator Raftery served in Europe for a long number of years and his knowledge of the European scene is extensive. His remarks were also much appreciated, well made and well taken.

Senator Ryan has his own agenda and it is part of democracy that people are entitled to the views they express. It would not be proper for me to suggest that Senator Ryan was out of order. Quite the contrary, if they are his views, so be it although I do not agree with them. However that does not for one moment suggest that he is not entitled to make them.

Senator McDonald is a long serving Member of the Oireachtas. I have known and respected him over the years. His short intervention was succinct and to the point. I am grateful to Senators for their contributions.

The Irish people gave politicians a mandate to ratify the Treaty of European Union. The Government have taken all the necessary steps to allow the State to ratify the Treaty of European Union but more steps remain to be taken. It is fair to say that all that remains to be done in respect of the Bill is to put it through the Committee and Final Stages. The Bill will then be sent to her Excellency, the President of Ireland, in due course. Again my gratitude for the helpful contributions.

Acting Chairman

As it is now 1 p.m. in accordance with the order of the House today, I am putting the question: "That Second Stage of the Bill is hereby agreed to and that the Bill is hereby agreed to in Committee and is reported to the House without amendment, and Fourth Stage is hereby completed, and the Bill is hereby passed".

Question put and agreed to.
Sitting suspended at 1 p.m. and resumed at 2 p.m.