Thirtieth Amendment of the Constitution (Treaty on Stability, Coordination and Governance in the Economic and Monetary Union) Bill 2012: Committee and Remaining Stages

I welcome the Minister of State, Deputy Joe Costello. Before Committee Stage commences, I would like to deal with a procedural matter relating to Bills to amend the Constitution. The substance of the debate on Committee Stage relates to the wording of the proposed constitutional amendment which is contained in the Schedule to the Bill. The sections of the Bill are merely technical. Therefore, in accordance with long-standing practice, consideration of the sections is postponed until consideration of the Schedule has been completed.

On a point of order, will the Leas-Chathaoirleach clarify in layman's terms what this means as regards speaking to the sections of the Bill?

It is like putting the cart slightly before the horse. In other words, the Schedule is agreed to first, followed by the sections of the Bill. I do not believe it makes any practical difference. It is a long-standing tradition when dealing with constitutional amendments. Senators will still have a chance to speak to the sections.

Are we allowed to speak to the Schedule and the sections?

Yes. There will be no prohibition on contributions within reason.



Tairgeadh an cheist: "Gurb é an Sceideal an Sceideal a ghabann leis an mBille."

Question proposed: "That the Schedule be the Schedule to the Bill."

As there are no amendments, does the Minister of State want to make an opening address or does he want to listen to Members' contributions first? It is his prerogative.

Our group would welcome the Minister of State's address at this early stage to clarify the Schedule and the Government's view.

The Minister of State is going to wait and listen to Members' contributions first.

I welcome the Minister of State, Deputy Joe Costello, and the debate on the fiscal compact treaty, even if it is in the context of processing the Bill through the Houses of the Oireachtas.

On the Order of Business many Members mentioned the trade unions which have come out against the treaty. As the Minister of State knows, several trade unions have been very clear in their opposition to the treaty because they do not believe it will be good for Ireland and working people as it will enshrine austerity in law for decades to come.

The backdrop to the debate on the treaty is provided by what is happening in the economy. There are still far too many out of work and no real plans to get people back into employment. People see the domestic economy floundering. Further evidence of this was presented in a Bank of Ireland report published yesterday which stated domestic indicators remained weak, unemployment remained elevated and residential property prices did not appear to have fully stabilised. It also stated there were heightened concerns about other eurozone economies. This proves that across the European Union austerity measures are dampening economic growth and having the opposite effect of further job losses by taking money out of people's pockets. The trade unions which represent working people have sensibly come out in opposition to what they see as a bad treaty.

To be honest, the treaty does not solve the real problems in Ireland or Europe. Many social democratic parties, with which the Labour Party is affiliated, and the European Trade Union Confederation have come out to state "No" to a treaty which will not work. The ink was barely dry on the treaty when the conservative right-wing Spanish Prime Minister opted out of the fiscal adjustments which his country was asked to make. We see the same happening in Holland where there are tensions between coalition parties in government because they cannot make the tough fiscal decisions because of the effect they will have on the Dutch economy. Looking back at all of the budgets since 2008, we know we are no closer to being out of the economic mess than we were in 2008. While Jack O'Connor, general president of SIPTU, has not come out against the treaty, he did say the national executive council of SIPTU had decided that if the Government implemented a jobs stimulus plan, it would be prepared to recommend in favour of the treaty in the referendum. Otherwise it cannot endorse it. He has made the same point as Sinn Féin.

The big issue in Europe is the lack of investment and growth. The treaty will lock us into decades of more austerity and not deal with the real problems. It will implement existing fiscal rules, already in place since the Maastricht treaty was agreed to, and the debt brake rule which asks member states to reduce their debt-GDP ratio to 60%. Ireland's current debt to GDP ratio is 105%, with the Government telling us it will be 120% by 2015. It must be remembered what that debt is. Some of it is money borrowed in the sovereign bond markets by the previous Government. Some of it is what we are borrowing because of the big black hole in the public finances. However, some of it is also money used to recapitalise the banks and bail out bondholders. We are being asked to pay back this debt faster, with no write-down. After 2016, what will a reduction in the debt-GDP ratio from 120% to 60% mean? It will mean more tough budgets and austerity.

There are also the fiscal discipline deficit rules, with the existing 3% Stability and Growth Pact rule and the structural deficit target of 0.5%. In a useful briefing document from the Oireachtas Library and Research Service I note many economists differ on what the structural deficit is and how it is to be measured. It was explained to us that a structural deficit would preclude short-term shocks or interventions in the cycle of an economy, with the longer-term cycle of an economy being considered. The deficit would be calculated on that basis. There are no clear guidelines or measurement of targets for how this is calculated but we are being asked to put these elements into Irish law and the Constitution.

During the Order of Business, a number of Senators from the Fianna Fáil Party also made the point that we had budget surpluses for years; therefore, we were not borrowing recklessly. Greece was borrowing for day-to-day spending but in Ireland we had budget surpluses. Even if we were to adopt the fiscal compact treaty, it will not ensure we never have a Celtic tiger scenario again. It will limit the ability of member states to invest or borrow for day-to-day spending, forcing governments, where possible, to balance the books. That does not accept the reality, as no small to medium-sized business would be able to operate under those very strict guidelines. One can imagine if a small business could only borrow 3% above what is being taken in within a given year. How could a business borrow to expand? It would not be able to do so and the same applies to an economy.

We all accept we must reduce the deficit and there must be an element of fiscal discipline. We are going from an extreme where those in Europe argue there was much reckless borrowing but the reckless borrowing in Ireland was not done by the State or the taxpayers but by bondholders, banks and people lending to the banks. Those banks in turn loaned money to developers who were speculating on the construction sector, and that is where there was recklessness. This treaty does not deal with such issues, such as banking regulation. We are not getting the real solutions to the problems in the economy, which is part of the dilemma and why many people will vote against this treaty. We are simply locking ourselves into more fiscal discipline rules.

There are times when governments can balance the books or when there is a surplus, which is great, but there are also times when a deficit is needed and one must borrow to invest as an economy needs it. We are going from an extreme, with reckless spending and borrowing in the likes of Greece, to another extreme where we prevent any kind of real borrowing despite countries needing to borrow to invest. If we are honest, much of this is about getting Angela Merkel and Nicolas Sarkozy over their respective elections. They wanted tight, draconian and Germanic fiscal rules imposed on member states. The treaty was concocted primarily by those two countries, with all the others asked to come in behind it and support the treaty. Perhaps people felt we had no choice.

The question being levelled at those who oppose the treaty is where we will get the money. I will deal with the issue and pose a number of questions to the Minister of State in that regard. The first consideration is access to the European Stability Mechanism, ESM, funding, which must be approved by the Oireachtas. The Taoiseach and the Tánaiste have indicated that the Dáil will not make any decision on the ratification of the ESM until such time as the people have their say on the fiscal compact treaty. If we say "No" to the fiscal compact treaty, as I hope we do, I do not believe any Irish Government will accept the terms of the ESM treaty. The fiscal compact treaty is intergovernmental and we can simply opt out, as is our choice, with other countries proceeding with the terms if they so wish. Britain has opted out, as it saw this as sensible and in its own interest.

Those in the Government are asking where we will get the money. The Labour Party leader and Tánaiste, at his party's national conference — I use the word "national" loosely — said that Ireland would be back to the bond markets within the next two years. He proudly proclaimed that, and if it is the case, we will not need access to the ESM funding. The Government is accusing those who are opposing the treaty of scaremongering and being inconsistent but there is a clear inconsistency at the heart of the Government's comments. On the one hand, the Taoiseach and Tánaiste are arguing that we will return to the bond markets and reclaim our sovereignty because we are making the right decisions but on the other hand they are saying that just in case that does not happen, we need the ESM as an insurance policy. We are in a bailout programme and we are financed up to the end of 2015. As a result, the issues only kick in after that time and it will only happen if the terms of the first bailout fail and we do not get to the 3% deficit target of the Stability and Growth Pact. If we fail to get to the 3% target in the bailout terms, it will prove again that austerity measures put in place since 2008 would have failed. That is the only reason we could be asked to get into a second bailout and apply for money under the ESM. Why would we lock ourselves into more austerity in that respect?

We had a good three hour discussion last night and yesterday, with only one contribution opposed to the treaty. I know a number of Senators are shaking their heads when I am speaking but there is a different world outside this Chamber. This room does not reflect public opinion and a good 40% of people have indicated they will oppose this treaty, with more people open to the argument. People are not convinced by what the Government is saying, and the more trade unions and civic leaders come out to make the right stand for Ireland and its people — standing by the interests of those people — the better it will be.

The funding issue is a complete red herring. That element was inserted into the treaty on purpose to blackmail people. Mr. David Begg said the treaty was socially and economically wrong and if that is so, why should a single citizen in the State vote for it? The response has been that we may need the money. The reality is that Europe will not and cannot afford to allow Ireland — a eurozone member — sink. The Government is convinced Ireland will return to the bond markets, which we want, and we should take different approaches in reducing the deficit, separating private banking debt from sovereign debt. We should have a strategy to grow the economy in order that we can get back to the bond markets. However, this country will not get there because of the kind of policies being implemented by the Labour Party as part of the Government.

We have an opportunity for a proper debate, and this is only my initial contribution. I hope we can have a robust, honest and strong debate about the implications of the treaty. I also hope the Government will be honest about what the treaty can do for Ireland. Many of those advocating a "Yes" vote, including many economists on the political right, are also indicating this is essentially a bad treaty. Very few people are arguing this is great or good because it is not. Our work will be tough, but if the treaty is ratified, it will be much tougher for this country. The real danger will be long-term as we will tie the hands of future Irish Governments in the ability to manage the economy and fiscal and budgetary affairs. Giving more power to the European Commission and the European Court of Justice is dangerous, as is the potential to impose sanctions on this country, which the treaty would also allow.

I welcome the opportunity for further debate on the treaty and hope there will be more balance in today's contributions, where there will be a flow as opposed to the statements we had on Second Stage yesterday. I hope it will be a robust and honest debate.

I remind Senators that we are on Committee Stage. It is not my intention to stifle anybody. Some 20 people spoke yesterday on Second Stage, along with two Ministers. I will be as fair as possible to everybody.

I will address some of the points made by Senator Cullinane in particular. Nowhere in the title of this treaty does the word "austerity" appear, and the Senator should be very careful in using the word. The well-being and future of the country is at stake and the Senators should get that into their heads.

We understand it. It is an austerity treaty.

This treaty is about transparency and accountability, which Sinn Féin seems to be against. It is also about precluding Governments from engaging in the reckless type of behaviour and spending policies of the past. That is why I urge the Minister of State to ensure what the treaty stands for is outlined in clear, concise, layman's terms in the information leaflet being sent to every household. That is imperative to prevent fudge, which would allow opponents of the treaty to make hay.

If I was to allow my heart to rule my head in this debate, I would agree with what Senator Cullinane outlined. He has made a coherent, cogent argument as to why the treaty should be rejected by the people. However, he made a reference to living in the real world and perhaps it would be instructive to reflect on what is happening in the real world. I hope the Minister will respond to this comment.

Political upheaval is under way in France with the expected demise of President Sarkozy and that has implications for the eurozone and for relations between France and Germany if Monsieur Hollande is elected, as he has indicated he will renegotiate the treaty and add a growth element to it. There was shock news yesterday out of the Netherlands, one of few countries with a triple A rating. Its Government has collapsed because it could not agree budgetary proposals which, by comparison to what has been imposed on the programme countries, pale into insignificance, as they comprise a relatively small amount. A wind of change is sweeping across Europe which is reflected in the first round of voting in France with the concerted rise of the far right vote and in the collapse of the Dutch Government, which is also centre right. The message seems to be that people are beginning to increasingly question the concept of austerity and how long it will last.

From an Irish perspective, the real world is that as a result of the upheaval yesterday, Irish bond yields, which were on a downward trajectory over the past number of months because of the work the Government was engaged in and because of the manner in which it was selling Ireland, increased. Investors who have money dictate bond yields and, ultimately, whether Ireland can return to the bond markets and borrow money at a reasonable interest rate that will not put further obligations on the Government, the very thing Senator Cullinane and his party constantly tell us we should avoid.

While the world will not come to an end if we reject the treaty, we will send a clear message to the very people we hope to go back to for money in two years' time. They will say, "You are not even prepared to get your own house in order. You are not prepared to pay back the money you have borrowed so why should we give you anymore?" David Begg is right on two fronts. He is right about his attitude towards the treaty but he is equally right that it is effectively a gun to our heads in that if the Irish people fail to ratify the treaty, it could close off all the opportunities we have to access further funding that we will need.

I stated earlier on the Order of Business that I had no wish to rewrite history. We can feel grievously wronged because we played by the rules until the bank crash in 2008 while France and Germany were not adhering to the Stability and Growth Pact agreed under the terms of the Maastricht treaty. Ireland continually returned budget surpluses. In 2006, the much maligned former Taoiseach, Brian Cowen, was Minister for Finance and he generated a budget surplus of €3 billion, €2 billion of which was set aside to reduce the national debt with the remaining €1 billion invested in the capital programme. That has been forgotten in the tsunami of insults and attacks thrown at the Fianna Fáil Administration for being reckless.

Since 2008, when the bank crash happened, we have been saddled with bank debt, as have other countries. It is instructive, and perhaps the Minister will respond to this, that economists now suggest that because of the fear surrounding Spain and its increasingly unsustainable debt, Europe will have to look at the sustainability of bank debt in the medium and long term. Large economies such as Spain could have a greater trickledown effect if they go under and have to enter a bailout programme than tiny Ireland. A debate is beginning as to whether the ECB should step in or whether eurozone governments should examine the possibility of reducing the unsustainable Spanish bank debt. Spain is in the same position as Ireland, except on a much larger scale. If that is the case, it would be sensible and selfish to send the message that the people will vote for this treaty on the basis that we agree that we need to get our house in order. We cannot continue to sustain massive deficits and I am glad Senator Cullinane and his party agree that the gap should be bridged. He agrees that we cannot sustain a €15 billion budgetary deficit annually. Neither he nor Sinn Féin has indicated at any time where they would get the €15 billion but that is for another day. He has at least conceded that this is unsustainable.

We are getting our house in order. There is a dispute over the EUROSTAT figures that emerged in the media in the past day or two but it seems that we are ahead of target at 9.6% of GDP and moving towards an end of year total of a little over 8%, which will eventually reach 3% by 2014. It is not as if we have stopped progressing. We are moving towards balancing our books.

When one weighs all of that up, it is not just about today. It is about what will happen in two years and when we achieve a balancing of the books, we can look to return to the bond markets for money. Senator Cullinane's party says there are times when governments can borrow into deficit for investment purposes. If we fail to pass the treaty, the message that will send could be hugely damaging to the country. David Begg is correct that the unions will be pulled kicking and screaming into accepting that the treaty has to pass but he is a realist. Who is living in the real world? The treaty is no panacea and the wind of change blowing across Europe suggests the treaty and its implications may be revisited. We are staring into a hole of uncertainty because economic circumstances are ever changing.

Our reality is that we are moving in the right direction. The Government hopes to get into the bond markets within the next two years and we will be close to a balanced budget at that point. We will then be able to argue the case that the bank debt is unsustainable and I agree with Senator Cullinane and many others about this. We cannot allow this albatross to sit on the shoulders of future generations. It has to be addressed and I believe it will be.

Let us take tiny steps first and cross every bridge as we come to it. The fiscal treaty is the bridge we now face, flawed and all as it is. No detail is outlined in the treaty to address the questions raised by Senator Cullinane and others about the definition of "structural deficit" and what sanctions will be imposed if we breach the budgetary target of 3% of GDP. The reality is that we want to send a message of a strong and confident Ireland that is trying to get its house in order and balance its books to ensure the gap between income and expenditure on essential public services is bridged in order that we can convince those who have the money that we are a good bet and have not defaulted on our debts. At that point, the case to be made for tackling the unsustainable bank debt would be so strong, with the aid of what is happening in Spain, and possibly Italy, which is suffering under much larger bank debts, that the logic would be that some form of compromise and accommodation will be agreed. For my part, I believe that will be quantitative easing, a devaluation of the euro. It has been proven in other countries, when a country has control of its currency to the point where it can adjust it to take account of the economic realities, that it is a way out of the austerity to which Senator Cullinane referred. That is an argument for another day. What we are faced with is our immediate future as a country and whether we are capable of sending a message to the people on whom we will rely that the steps we are taking are difficult and painful. I am opposed to austerity. It appears to be an unending saga, worse than the longest running soap on television.

"Coronation Street".

People are beginning to reflect that anger as we have seen in the recent opinion polls. It was inevitable that would happen. The ship must be held steady and my party, for what it is worth, will help to ensure that happens.

I listened with great interest to Senator Mooney's contribution. I agree entirely with him. He put the case cogently in favour of the Bill. Senator Cullinane made an eloquent Second Stage speech. On Second Stage I thought we teased out the issues. None of us is suggesting the treaty is utterly great or that it is a panacea. We are all realistic about it, as Senator Mooney has said. It is not helpful for those on either side to speak in overblown language on either sides. The approach on both sides must be measured. As others have said, David Begg's comments were measured. He made the point that he is not widely enthusiastic about the terms of the treaty but accepts the alternative — the instability and uncertainty and the message it sends to potential investors and others — is worse for working people. That is why, on balance, it appears he is taking an approach in favour, although we must wait and see what ICTU does.

The referendum, if passed in accordance with the Bill, would put into the Constitution the text that the State may ratify the treaty. It does not put the text of the treaty into the Constitution. That is an important point that has, perhaps, been overlooked in the debate. Others have asked the Minister about the text that will go to households along with the text of the treaty. I presume families will also see what they will be asked to vote upon on 31 May and will see the text of the amendment to the Constitution. It is important that people get advance notice. We have had referenda where people had only seen the text in the polling station. That is not helpful to ensuring people vote in an informed manner.

In response to a couple of the points made by Senator Cullinane, and without making another Second Stage speech because I spoke yesterday, there is not a simple left-right divide on the issue at EU level. The party of European socialists did not vote against the stability treaty but against some elements of the Stability and Growth Pact at an earlier stage. Ultimately, those who voted against the treaty included not only Sinn Féin but UK conservatives and the UK independence parties.

Do not forget the social democratic parties.

I did not interrupt the Senator. It is worth making the point that this is not a simple and straightforward divide. There are many parties and individuals on the left in favour, just as there are many on the right and on the far right who are opposed to the treaty. The potential incoming French President has made the point that he will include more elements of growth in the treaty, which is something we argued for from an Irish perspective. Page 1 of the preamble to the treaty refers to growth. The Library and Research Service gave an excellent briefing to Senators in advance of our previous debate on 14 March. A key point I took from the briefing was that 90% of the content of the treaty has already been agreed and is in place through existing measures such as the Stability and Growth Pact. Therefore, there is not a great deal that is new in the treaty.

I agree with Senator Mooney that none of us in favour of austerity. How could we be? To speak of the treaty bringing in decades of austerity is not helpful to the debate. What the treaty is trying to do and what those who negotiated it are trying to do is to fix the causes of austerity. This is only part of the jigsaw of different measures and nobody is saying this is the golden solution; far from it. We have to be realistic, but it is one way of trying to hold the euro, which is our currency, together. Yesterday, Senator Barrett made an eloquent speech about the flaws in the original design of the euro but, as I said in response, we are where we are. We must move on with what we have and try to shore up our currency for the sake of the people and the economy to ensure jobs and stability are maintained and we move towards growth. It is helpful that we have a measured and reasonable tone, that we do not shout abuse across the Chamber at each other on this issue and the debate at national level is conducted in the same way. That is what we would all hope for in the debate. On Committee Stage it is useful to reflect on the actual words in the Bill.

I call Senator Barrett. Is he conceding ground to his colleague?

Yes, to my more eloquent colleague.

I will not be the judge of that comment.

I am grateful to Senator Barrett who, as always, is graciousness personified and knows much more than I do on this subject. I have strong feelings on it, however, and while they are not represented very widely in the House, they are widely represented throughout Europe.

The Senator promised to be brief.

This is another classic example of the democratic deficit. A colleague in the other House, Deputy Catherine Murphy, who sent around a very interesting document, pointed out that although we are just discussing the Schedule, which is a short brief piece of prose, it contains wording that has only been used three times before and always in situations when there was a substantial ceding of sovereignty from this country to centralised bureaucracy in Europe. That is a point that should be borne in mind.

The whole treaty is a farce from beginning to end. The Minister, whom I know as a former neighbour and regard still as a good friend, despite our political differences on this specific issue, knows perfectly well it is a farce. What are we voting on? Let us look at the political situation. I said yesterday it is likely that Monsieur Hollande will be the next president in France and he has committed himself to changing the treaty. What we are going to vote on will be changed. It is an illusion, a mirage. There is also the situation, which I find intriguing, of the Dutch Government having collapsed because Geert Wilders got out of it. He is right wing but he cannot stomach and does not believe the Dutch economy, one of the few AAA rated economies in Europe, can take the €15 billion cuts that will be involved.

We have been told, very honestly, that Mr. Begg has said the single reason for voting for the treaty is we have a gun to our head. He is absolutely right. People are trying to point a gun at our head. Senator Bacik, as a distinguished lawyer, must know that a contract extracted under duress has no legal force. If the gun is pointed at our head and an attempt is made to pull the trigger, it will not blow us out of the water. It will blow our assailants out of the water and expose them for what they are, a collection of bullies who do not know which direction they are going in. There has been no centralised leadership in Europe whatever.

I thought the Senator was against centralised leadership in Europe.

No, not necessarily, but I am against centralised folly. Let me just examine a few of the other clichés that have been delivered today. First, I believe it was Senator Bacik who said "we are where we are."

I was using it ironically.

What a novelty. I do not think I have heard that before and I shall certainly write it down in my little book for further reference. Senator Mooney on our side of the House tells us that he is living in the real world. I think I am living in the real world too, but we just take different views on it. The world is either real or it is not real. To say that one is living in the real world does not mean that one can use that phrase to discredit other people's opinions. We just take different views. That is what I call civilised debate.

In regard to the impact of this treaty, we were told that passing this referendum will show that we are a strong and confident country. Like hell we are. I wish we were a strong and confident country. I would love it if the rate of suicide was not continuing to climb because of the economic pressure, not just in this country but throughout Europe. I would love it if the citizens of Europe were not queuing at soup kitchens in the centre of Amsterdam. I would love it if people were not living in cardboard boxes in Syntagma Square. Two weeks ago I was in my local supermarket in Cyprus and when I came out, an elderly man and two young fellows were collecting to buy food for the people in Greece. We are witnessing the slow disintegration of capitalism. Those on the left should be proudly raising the red flag and asking people to look at the real alternatives. This process was initiated in the United States by co-operation between what I regard as international criminal elements, namely, Goldman Sachs, which was paid €600 million for cooking the books for the Greeks to get them into the euro in the first place, and the ratings agencies, about which I have been speaking in this House for at least the past five years. I think we are seeing the beginning of a sort of disintegration and the only way forward is to put humanity and respect for citizens at the core of our policy. I have been making this point for quite some time.

When the banking issue was being debated in this House, I said to the people who are now sharing this side of the House with me and to the late Brian Lenihan, who was making the point that Anglo Irish Bank had to be saved because it was of systemic importance to the Irish economy, that although I was not an economist, my analysis of the language of his speech suggested he was saying the preservation of the system was of more significance than the welfare of the people. That is wrong. The welfare of the people must come before the preservation of the system and let us deal with what happens to the system after the shake-out.

My point is that our primary responsibility is to the people in this country. In total, 50% of young people in Spain are unemployed, but in a region in the north west of Spain, the exact name of which I cannot remember, things are doing quite well because the people have taken control by developing co-operatives and everything is done on a co-operative basis, including banking. It is rather like what our building societies used to be before people, such as Mr. Fingleton, with the active encouragement of some Members in the other House, who now pretend they did not do it, privatised the operation. In that region of Spain, the banks are owned by the people, agricultural and pharmaceutical production as well as the manufacturing of goods such as refrigerators, televisions and so on is done by co-operatives, all of which are in profit. The bank is the seventh largest bank in Spain and it is about the only one that is not in financial trouble. There are other ways of looking at this matter.

We do not have to sign up to a treaty that we all know is a farce, which is confused in its terminology and in respect of which it is not known how to measure or quantify the elements that constitute its significant parts. The difference between structural and fiscal deficits is not known. They have been shown to have been got wrong in the past and we all know it will lead to the bankruptcy of this country. We heard Romano Prodi say yesterday that increasing austerity will lead to revolt. There must be hope. Where is the hope in this? Senator Mary White said on the Order of Business that we needed inward investment and to be part of Europe and so on. We will still be part of the European Union. We are entitled to vote against the treaty. We are lucky to be one of the few to have the opportunity to vote on it. Democracy has been taken away. Let us look at the shameful examples in Greece and Italy.

We have been the good boys and girls in the class. All the way along we have paid everybody else's debts, we have volunteered in a way that goes beyond the wild successes of Christianity, where we were told that if a man attacks you, you give him your coat. We have gone beyond an excess of Christianity in paying other people's debts. There is a cynical side, which is that no good deed goes unpunished. Every time we did it, the reward was a slap.

I am not sorry to see capitalism in trouble. I did not gloat about the death of communism, as most of my colleagues did. It was never tried. Stalin was not a communist. Mao was not a communist. None of them was. There was a noble effort in Nicaragua to try to bring together people with the motives of humanity, society, co-operation and the incentive — the carrot — of the natural human instinct to gain some kind of regard or advantage. That is the direction in which we should go.

I do not believe for one single solitary second that this instrument, which I refuse to call the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union, rather the treaty on instability, will bring about stability. I do not doubt the motives of all my colleagues, but I wish to share this nugget. I was one of a very small number of people who spoke against this treaty on the Order of Business yesterday, but there were members from every single party who came to me privately and said they wished they were able to say the same things, because that is what they believed. I think it is important that we be honest. I do not believe in signing up to a tissue of lies that we know we cannot achieve. The Spanish have done it. They were honest about it. They were honest about their dishonesty. That was great. They signed the treaty in the morning and in the afternoon they said, we will not reach the objectives because they are quite impossible. Is that real politics? Is that honest politics? Is it what we need to get us out of this mess? I do not think so.

I hope my remarks were within the limits of civilised debate. I do not think I said anything that was personally offensive to anybody. If I did I regret it — partly. I said what is in my heart and what I believe is true.

It remains to be seen whether the people will vote for the treaty. It is their decision, as it should have been the decision of every single country in Europe, not just a tiny minority. It should not be left to governments. That is as sensible as what was said on the other side of the House on the Order of Business, when we were told the Cabinet would supervise the installation of the correct kind of water meters because it, rather than professionally qualified water engineers, had the intellect and power to deal with the matter. I wish it would think about something more serious. It should be each to his own particular métier.

I welcome the Minister of State to the House. I trust he will bring back the views, questions and concerns on all sides to the Cabinet. It is good to have this robust debate. As Senator Norris said, this kind of debate is not happening in other European countries. I do, however, wish to address some of the comments made by Senator Cullinane, particularly towards the end of his contribution. While it is true that perhaps public opinion is changing, as he and we all know, public opinion does not necessarily direct the right thing to do. We need to have robust analysis where we look at the content of the treaty. I appreciate the reflections of my colleagues today and yesterday. This, ultimately, will be a political judgment on the basis of that content. That judgment is based on political as well as ethical interests, which we all know. It is important to keep that in mind.

I want to focus on the Bill, in particular the wording of the referendum to be put to the people. I have a couple of questions and one serious concern. Senator Bacik directed us to Part 2, which is the wording to be put to the people. As Senator van Turnhout said yesterday, it is not the actual rules of the treaty, rather that the State will ratify the treaty. My concern, which was raised in the Dáil by Deputy Murphy, concerns the second sentence on what will be put to the people. The Bill states: "No provision of this Constitution invalidates laws enacted, acts done or measures adopted by the State that are necessitated by the obligations of the State under that Treaty or prevents laws enacted, acts done or measures adopted by bodies competent under that Treaty from having the force of law in the State." What precisely does that mean? I hope I can have a response to my question. I am sure the people wish to know what that means. Does it mean that no laws which are implementing the provisions of the treaty can be considered unconstitutional? If the people pass the referendum and we ratify the treaty, does that mean when we want to pass legislation as law-makers, no laws to implement the provisions of the treaty can be considered unconstitutional?

I refer to the phrase "laws ... that are necessitated by obligations of the State under [the] Treaty". Can these laws be decided by Irish law-makers or will they be imposed on us by outsiders, such as what is decided collectively at an EU level? This is the heart of the concerns around the ceding of sovereignty. Does it effectively constitutionalise the ceding of sovereignty? Is this Part of the Bill, Schedule or wording that will be put to the people absolutely necessary? I understand the Tánaiste said it is necessary technically and legally because this is an intergovernmental treaty, as other Senators have said. We should not so tie the hands of Irish law-makers that we cannot look to our own context later on, have dialogue with EU partners and perhaps choose some significant change in terms of how we balance the governance of the EU with that of Ireland.

I want to try to tease out and clarify the meaning of the second sentence. Is there a difference between absolute constitutional protection of the treaty or a straightforward ratification of it? Why can we not simply put to the people that the State may ratify the treaty? It is the usual practice that where articles of the Constitution or amendments to it are in place, laws are then enacted and citizens have a democratic right to challenge them constitutionally. Will this not be the case for any laws we or other law-makers enact to implement the obligations of the treaty? If not, why not? My questions will help to inform my decision on how I vote on the Bill but not necessarily on the treaty.

My second concern is about the timing of the referendum. As we all know, it will take place on 31 May and today is 24 April. Information is required by our citizens for an informed, adequate and public debate. It seems to me members of the public have a very short period of time to get the information to debate among themselves and make an informed judgment. We demonstrate here and in the Dáil that people first need to understand the content of the treaty and then make a political, ethical and legal judgement about it. That takes a considerable amount of time.

As the Minister of State knows, research has shown if there is less time for information, people are more likely to vote "No" because they do not understand the question. The Minister of State referred in his speech yesterday to the fact that the public information campaign has been launched. Is it fully accessible to the public? The Minister of State referred to the website which was launched relatively recently. Even if one had not listened to his speech or had not heard about its launch one might have a sense that something is going on and search on Google for information. That is what I did after I heard about the website. One would want to know how one can find the public information. I put the term "fiscal treaty Ireland" into Google and an advertisement for the fiscal treaty appeared. I was not directed to any website such as the one created by the Government. The first bullet point referred to the Institute for International and European Affairs and what was termed its infographic, which laid out the European Union's response to the euro crisis. It comprised a map of all the problems and weaknesses in dark colours. There were references to the weak finance sector, weak economies and weak governance. It would not make me feel confident in voting "Yes" and did not have any of the explanation or information I was looking for. I then put the term "Irish fiscal treaty referendum" into Google and found scholarly articles and news such as "Kenny calls for a yes vote and the unions call for a no vote." When I visited the website, I found it was very good. The Government will be sending out information leaflets.

To come back to my first point on the need for clarification, with regard to the language that will be put to the people in the referendum to which they will say "Yes" or "No", the website states:

The amendment will not include details of the rules agreed under the Treaty. If this amendment is approved by referendum, the details will be dealt with in laws made by the Oireachtas.

However, it does not state these laws cannot be challenged constitutionally.

As other colleagues have noted, the position is continuing to change at European level. Recently I was in France where many think we are going to vote "No" at this stage. However, as I said to them, whether we vote "Yes" or "No", is it not great that we are having this debate and that the treaty is being put to the people?

I reiterate my concern about the second sentence in the Bill and ask if the treaty is simply about providing for austerity constitutionally. Last week the Tánaiste said "No," that it was about "managing our debt and managing it in such a way that, over time, taxpayers' money goes not into servicing debts but more and more into public services and targeted growth initiatives to create jobs." If that is the case — it is a political judgment based on the content — we need more time to have a fully informed public debate about the treaty in order that the people will be able to come to a democratic decision. A fully genuine democratic decision is always one that is adequately informed.

I echo much of what has been said. I welcome the Minister of State, Deputy Joe Costello, and thank the Ministers of State, Deputies Róisín Shortall and Fergus O'Dowd, who stood in for him yesterday.

Some 90% of the content of the treaty has been agreed to already, as Senator Ivana Bacik pointed out. Is that not the problem? Take the situation in which Greece, Portugal, Spain, Italy, Belgium and, latterly, the Netherlands and France find themselves. This is an arrangement of which the United Kingdom and the Czech Republic are not part at this time, while Denmark and Sweden were not included the last time.

We have to say the eurozone, as constituted, is not an optimal currency area. This is the problem we are trying to solve through this harsh fiscal regime. As we went through the issues involved yesterday, I hope I do not tread on the patience of the Chair in the points I wish to make. We always kept to the 3% rule, as well as the 60% rule, until the tsunami of the banking crisis hit us. Article 4 involves trying to redress the balance over a 20-year period by a figure of one twentieth each year, which would impose incredible burdens on the country. I estimate that to move from where we are, where there is probably a 120% debt-GDP ratio, to a figure of 60%, we would probably have to run a surplus of €4 billion to €5 billion a year. However, we have all the economic evidence we need that this is not the way to go. Ireland's role is to say this in Brussels. As Senator Katherine Zappone said, we should say, "By the way, we consult the people."

I thank the Taoiseach for his undertaking that this will happen once and that we will not keep running the referendum until we get the right verdict. Adopting such an approach seriously undermined democracy previously. I welcome the fact that the Cabinet decided to hold the referendum, although, apparently, it might not have been judged as strictly necessary. The Attorney General and the Cabinet have done democracy a service.

For how long is it the wish of people in Brussels and Frankfurt that Germany should run huge surpluses, while other countries experience mass unemployment? Is it not time to say that when one blows up the laboratory, the experiment is over? This is the basic problem that has to be addressed. Rather than saying, "If we pass this referendum, people in Brussels will think we are great," perhaps we might say it is about time the Irish stopped touching the forelock. Instead of saying, "We will receive a subsidy if we vote for it," we should say nobody believes this and that, while it may infringe on the egos of those who promote the euro in its current form, it is time to end the experiment.

I want to put one important technical question to the Minister of State. The reference is to the European Stability Mechanism, ESM, but the only place it is mentioned in the treaty is in Article 8. The place where it is stated we will not be eligible for any more ESM money if we do not vote "Yes" on 31 May is not the treaty, as I see it, but in the preamble. While I have not received legal training and Senator Ivana Bacik is not present, is it not the case that what is included in the treaty prevails over what is in contained in the preamble? What is stated on page 7 of the eight page preamble is exactly what the Oireachtas information service has reported to us, namely, that if we do not ratify the treaty, we will not eligible to receive ESM funding. However, Article 2 in the body of the treaty takes precedence and states the treaty "shall not encroach upon the competences of the Union to act in the area of the economic union". What is happening is undermining the European Union because it is imposing hardship on countries such as Greece and Portugal, as well as this country, as the Minister of State and others more experienced than I in the field of politics will find on the doorstep. I am not sure the world would come to an end if we were to take into account what Article 2 states, namely, the treaty "shall not encroach upon the competences of the Union to act in the area of the economic union".

The system is obviously not working, with massive unemployment, in particular youth unemployment, throughout the European Union. Article 4 will impose severe burdens on us. I agree with Senator Paschal Mooney's point that the 40% of debt incurred to save the banking system owing to the bad design of the euro should be a priority for removal. That is what is stopping the European Union from working and is resulting in mass unemployment. The currency was a step too far and has not worked. There is no longer any point in face-saving for those who promoted it. As Milton Friedman and others pointed out, we sleepwalked into this. One of the lessons is that the Government needs an economic service to serve all Departments, with a level of expertise that could have prevented us from sleepwalking into this arrangement which has now come to a sorry end. We need an exit mechanism and to recognise that one-size-fits-all interest rates do not work. We need a regime of fiscal transfers, which means the Germans should share some of the surplus with the countries being impoverished by these arrangements. We need protection against the tsunamis of mass credit provision which destroyed the banking system, as happened in the case of Ireland.

Are we permanently shut out of the ESM by the preamble, or does Article 8 take precedence? Could we use this issue because we are voting, unlike anybody else in Europe in which there is obviously such huge dissatisfaction? We are the leaders for democracy. I am proud of the Constitution and those who gave it to us as it respects our right to be consulted. I am proud we have a Cabinet that is consulting us instead of doing this behind closed doors. That is one of the reasons so many in Europe sleepwalked into joining an unsatisfactory common currency that is not working.

I welcome the Minister of State. Much of what has been said on both sides of the House has been directed towards people living in the real world. Listening to the contributions I have been thinking to myself that every one of the Senators who spoke must be on the plus side with his or her bank, given the way he or she has been talking. I am surprised by the point made on the preamble by Senator Sean D. Barrett, a man for whom I have massive respect. In the real world I know that if I do not pay my bank and if I was, like many in the country, 90 days in arrears on my mortgage, and I then went into the bank to seek a business loan, there would be only one answer —"No." That is what is happening in the real world and with banks in this country. Ultimately, our bank is the European Central Bank because that is where the money which is bankrolling our country at present comes from. However, terms and conditions apply.

Senator David Norris stated that any contract signed under duress is invalid. I suggest that 90% of mortgages signed in recent years are invalid if that is the case. I know of people who went to the auctioneer on a Thursday and when they returned on the Friday to make a down-payment of 10%, the house had increased in value by €25,000. Such madness was taking place and that is what people are burdened with now.

Other Members referred to austerity. No one wants to introduce austerity or to ask our people to take the pain they are enduring, but what is the alternative? It was stated earlier that some in government were asking the question, "What is the alternative?" If we reject the treaty and we are told by those in Europe that there is no more money, where will the money come from? We are with the lender of last resort at present. Therefore, where will the money come from to pay public servants and to keep services going? There is austerity but no hospital or school has closed yet. No emergency department is being closed. That is what it could be like and that is what I am concerned about. People have said the treaty is not perfect, but we are with the lender of last resort and these are the terms and conditions for the ongoing financing of the State.

I would love to have seen Fine Gael and the Labour Party in government when there were budget surpluses of billions of euro every year. I would like to think we would not have squandered it. I would like to see Fine Gael and the Labour Party in government sometime when we have a budget surplus.

When people call for an honest debate, they are usually talking out of the corner of the mouths while stirring it in the background. If there is to be honesty in the debate about austerity, we should admit that there is no longer a border between here and Northern Ireland. It is simply imaginary. As part of a power-sharing arrangement, Sinn Féin has no difficulty ramming austerity down people's throats in Northern Ireland. It has no problem with a property tax in Northern Ireland where it is in government in a power-sharing arrangement. It has no problem with people paying for water in Northern Ireland. If it were in power in this jurisdiction, I would like to see what it would do.

We have no wish to see it.

We should not speak out of both sides of our mouths. If Sinn Féin can accept it and live with it in Northern Ireland, it should not be so populist and patronise people by suggesting there is no need for them to take it. They do not have to take it but Sinn Féin is ramming it down the throats of the people they represent and those whom they guide in the North through the power-sharing arrangement.

Reference was made to the real world and the bank loan. I meet a vast number of people who are in negative equity and who have substantial bank loans. I meet business people every day. I hope the new legislation coming from Government with regard to the loan guarantee scheme will help. People come to me with viable business ideas and so on but they cannot get the finance to put them in place. I call on people to bear in mind that this treaty is not perfect but it is one of the terms and conditions that we are getting from our financiers, the financiers of last resort.

Ní bhfuair mé deis aréir fáilte a chur roimh an Aire Stáit mar nach raibh agam ach cúpla nóiméad chun labhairt ar an ábhar seo. Cuirim fáilte roimhe anois. Caithfidh mé a rá go gcuirim fáilte roimh an díospóireacht meáite agus cothrom seo. Tá dhá thaobh na hargóna á chloisteáil againn. Shuigh mé tríd trí huaire agus 15 nóiméad d'argóintí ar son an chonartha seo aréir. Níl aon locht agam ar sin. Ba mhaith liom ceisteanna a chur ar an Aire Stáit faoi roinnt de na ceisteanna agus pointí tábhachtacha a ardaíodh chun soiléiriú a fháil ar cuid acu.

There has been a good deal of discussion in the debate today about living in the real world. It is somewhat rich of a Fianna Fáil Senator to tell us that we are not living in the real world since they lived in a parallel universe for so long. The real world for those of us in Sinn Féin is the world of the carers campaigning outside the gates at the moment and that of the lone parents who are holding a press conference because of the cutbacks resulting in such austerity for them and brought in by the Government.

Senator Sheahan's lack of understanding of the situation in the North surprises me since we have raised it on numerous occasions. Senator Sheahan does not appear to understand that the North is governed under Tory cuts from a block grant from Westminster.

Why does Sinn Féin not leave government there?

Does Sinn Féin not have a vote there? Every Sinn Féin member has a vote there as well.

If Sinn Féin members felt so strongly about it they could pull out of government in the North.

Sinn Féin could pull out of government there.

I gave the Senators leave to speak. If they wish to hear the answer they should listen.

I realise it is hard for the Senators to control themselves when we get to this type of debate. We were opposed the introduction of the water charges in the North.

This is more of the honest debate to which I referred.

Senator Sheahan is welcome to come to Stormont with me to visit the relevant Minister, Conor Murphy, with whom I discussed the matter last week. He outlined how he invested £1 billion in water services in the North.

The government there opposed it. Is that correct? That was a strange move by Sinn Féin.

He outlined how they opposed the imposition of water charges but it was defeated because the SDLP, the sister party of the Labour Party, stymied it.


Senator Sheahan is dragging down the tone of the debate with his heckling.

That is the blame game.

I note that when the Lisbon treaty was being debated, much of the same rhetoric was being used by members of Fianna Fáil and former Taoisigh with regard to the groups opposing the referendum. That did not help the tone of the referendum.

Many Members have asked about the Sinn Féin alternative. Senator Mooney stated he never heard about an alternative put forward by Sinn Féin. That was repeated by several Senators yesterday. A calculated alternative was put forward in our pre-budget submission and previously which commented on these issues, and again I call on the Senators to read it.

A work of fiction.

One measure referred to in the pre-budget submission was the introduction of a wealth tax. It is interesting to note that Monsieur Hollande in France has brought up the issue there and he is considering the imposition of a 75% wealth tax for people who have more than €1 million. It is an option that can be considered and implemented but the Government has chosen not to do it here. Another measure we referred to was the introduction of a third rate of income tax at 48%. To suggest there are no alternatives is simply untrue, but it is possible the Government simply has no wish to consider them. I realise the Minister will come back on that point and I appreciate he may have alternatives. Alternatives exist which should be debated.

We live in the real world where people are struggling. Having read the fiscal compact in detail and having studied the arguments on both sides, we do not believe it will solve the real problem. There is a problem with the eurozone. We honestly believe the fiscal compact will not solve it. Therefore, it will not improve the situation in Ireland or throughout Europe. We believe it will lead to more austerity budgets. We believe the rules imposed on us which would be enshrined in the Constitution if accepted in the referendum will impose a type of fiscal straitjacket for years to come. This will mean that we must cut billions from the economy for several years to come. Many economists on both sides of the argument concur with this view.

Another argument put forward is that we need a stimulus such as the one we suggested. That would involve talking to the European Investment Bank about getting a loan and using money from the National Pensions Reserve Fund to create a jobs stimulus package. I understand the Government is considering that option, and we welcome that.

There is a great deal of misinformation on this issue and it would be welcome if the Minister would clarify a number of questions which are based on some of the comments I heard yesterday and other comments in civil society. If we do not sign up to this treaty, will the Minister clarify that we will remain a member of the European Union because there appears to be confusion about that? We were told yesterday that we will be out of the EU if we do not sign up to this treaty. Many other groups are saying that also. I note correspondence from the Irish Farmers Association which Members may have received also, stating the reason farmers and their families should vote "Yes" to the fiscal treaty. It states regarding a "Yes" vote for the economy and growth, that membership of the EU and a stable euro are critical for exports, jobs, inward investment and economic recovery. The IFA is implying that if we do not vote for the fiscal compact we will be outside the EU in some way.

The Minister might clarify also that if we do not sign up to the fiscal compact whether we will be thrown out of the eurozone. It is our understanding that we will not. We will still be a member of the eurozone. An argument being implied, certainly by people on the "Yes" side, is that in some way we will be outside the euro if we vote "No".

Who said that?

The other sense I got from some of the contributions yesterday was that if we do not vote "Yes" for the treaty, in some way we are bad Europeans in that we are not playing ball with our European counterparts. Does that mean that, for example, the United Kingdom, the Czech Republic, the Danes and the Swedes, who have opted out of certain elements of EU treaties in the past, are not good Europeans? I do not believe that is the case but it is an important point.

Will the Minister also clarify that this is not an EU treaty? There was a sense in the debate yesterday that this is an EU treaty. It is not. It is an intergovernmental treaty outside the EU treaties. That bears reference to the point made by my colleague, Senator Barrett, about the European Stability Mechanism, ESM. The ESM is enshrined in an EU treaty and therefore it is open to question as to whether we would be able to access the ESM post-treaty if we vote "No". That issue is not cut and dried. As the ESM is enshrined in EU treaties, this so-called insurance policy or clause is only noted in the preamble to this treaty, which is an intergovernmental treaty. I am not an economist but I am aware that there are eminent economists and legal people who would question the strength of that so-called insurance clause.

Another comparison made yesterday was that this is only putting in place the type of rules one would have in a good household or business because budgets have to be balanced. That might have made sense in good times but I do not know many families in Ireland at the moment who balance their budgets. They are borrowing today to pay for yesterday's debts and as Senator Sheahan said, a huge number of households are in negative equity and finding it very difficult to survive. They are borrowing to get themselves out of a hole in the hope that in the future they will get out of the difficult situation in which they find themselves.

I have done a B.Comm degree and one of the things we were told was that when a business was in difficulty the wrong approach was to cut back everywhere but rather market, invest and sell to increase one's market, and one would have to borrow to do that. That is a basic principle of business I was taught, although it might have changed in the interim. Our reading of this fiscal compact is that it "straitjackets" future Governments in terms of being able to invest for growth and expand.

We do not see anything about job creation in the treaty. In addition, there is an issue around the holding of the referendum on a Thursday because it does not give a fair chance to people who might want to vote at the weekend, for example, students or younger people on whom this will have a definite impact in terms of being able to vote.

A number of other questions arise. I apologise if my contribution is lengthy but it is important to put all of the sides of the argument. How does the Government envisage this treaty stimulating growth? The economic straitjacket we find ourselves in under the troika deal is not having that effect. Growth is being stymied across Europe. Countries which had triple A status are losing that status. I understand there are now only three countries across the EU with triple A status. The unemployment lines are growing. There has been some positive news on employment, mainly from multinationals, but my argument would be that is not enough to get us out of the situation we are in. Multinational companies can be quite fickle. They will move to wherever is best for their interests and where they will make the most profit. There is no guarantee that they will stay here, as we have seen with Aviva in Galway. The real growth and stability for the economy is built on the small and medium enterprise sector but under the current austerity that sector is finding it very difficult. It is very difficult for those in the sector to get credit and because of the amount of money that must be paid back on promissory notes, etc., and in terms of the banking crisis, the Government does not have the ready cash to support those SMEs in the way that should be done. It is difficult to know how the current troika deal and a new deal which imposes a similar type of financial constraint will stimulate growth not only in Ireland but across Europe. If we cannot stimulate growth and investment in the economy, how will it create jobs? It is not clear to us that this treaty will create jobs.

We welcome the fact that a number of unions have come out in opposition to the treaty, and fair play to them for being willing to do that. SIPTU is straddling the fence on the issue. It has stated that it has serious issues with the treaty but that if the Government gives it a deal on a jobs stimulus package it is willing to call for a "Yes" vote. I might be open to correction but I believe one of the Labour Party Senators said yesterday that there was no question of such a deal being done. The Minister might tell us now if the Government intends to try to buy off SIPTU by promising a jobs stimulus package and then asking it to ask its members for a "Yes" vote. Alternatively, will he tell us that the Government will not try to buy the election on that type of promise? In that way any ordinary member of SIPTU, many of whom contacted me yesterday to say they were uncomfortable with the union's position, will then know that if that promise is not on the table they should vote against it as SIPTU has recommended. It would be clear for them to vote "Yes" or "No". We need to know whether the Government intends to give that type of clarification to SIPTU.

The Taoiseach stated in a state of the nation address that this crisis was not our fault. One of the fundamental problems we have with the treaty is that if it was not our fault, why are we still paying the penalties? That comes back to much of what Senator Barrett outlined. Many other socialists across Europe do not agree with the treaty. We have seen the stance taken by Monsieur Hollande in France. A renegotiation would be needed if the type of change he is talking about has to be brought in and it will change the fundamental nature of that treaty. He has toned down his comments somewhat because he is in the run-up to a general election but if he is elected he will be more robust in that regard. The Dutch Labour Party and the German Social Democratic Party have serious misgivings, and even the European trade unionists have an issue with this treaty. There is a broader body of people who are raising the types of questions we are raising. We live in the real world and it is important that many of these issues would be addressed.

A number of other important issues were raised, including the idea of sovereignty. We have a massive issue with the loss of political sovereignty in this situation because if we sign up to the treaty, as the Minister is aware, we will be open to much more scrutiny from the EU Commission in terms of the rules and regulations for our economic management in a troika style fashion. In many of the contributions yesterday from those on the "Yes" side of the argument we were asked the reason we would be worried about that. I would be worried about it because we are told daily that many of the decisions made by this Government are because the troika told it to make them. If this treaty is passed all we need to do is change the troika for the Commission. We will be told that we must bring in these charges to balance our budgets because the Commission told us to do so. The realpolitik will be that we are handing over the political decisions and what we can and cannot do from an economic perspective to the EU Commission. That is the reason Sinn Féin argues that, under the treaty, Ireland will cede sovereignty from a political perspective. We will also cede legal sovereignty because the European Commission rather than the High Court, the Supreme Court or the Houses of the Oireachtas will exercise control over what we do economically. If the Commission concludes Ireland is not meeting the targets set down in the treaty, it may take us to court and impose a penalty calculated as a percentage of GDP. Moreover, any other member state which believes Ireland is in contravention of the treaty and not playing by the rules will also be able to take us to court. My party has a major difficulty with handing over legal sovereignty to the European Court of Justice.

The penalties laid down defy the purpose of the treaty. As Senator Sean D. Barrett noted, if we are found to be in contravention of the requirement to reduce the government debt ratio to 60% over a number of years, we may be required to introduce annual cuts of up to €6 billion. However, as well as being taken to court for failing to meet this requirement, we may also have penalties imposed on us. As a result, countries that are broke will be required to introduce further cuts to reach the specified targets and will also pay penalties. Not only will they not have money in the bank, but they will also be required to impose further cuts and pay more into the European Stability Fund because they were bold boys in Europe. This does not make sense and will not help countries emerge from difficult economic problems.

I appreciate the leeway the Acting Chairman, Senator Marie Moloney, has shown me. However, it is important to voice the arguments against the treaty and I note some of the Senators opposite are itching to make counter arguments.

The treaty speaks for itself.

The text restates some of the old rules and strengthens more recent ones. However, placing these rules in an international treaty and giving it the protection of the Constitution makes these rules binding and permanent. In doing so, we will impose a specific and austere type of economics on the current Government and all future ones both in the State and the other member states which ratify it. These are the rules by which the signatory states will have to play, irrespective of whether their citizens like it. Sinn Féin does not agree with this approach because it is not in the best interests of the population of the State or other countries across Europe which may wish to take an economic approach which, as Senator Sean D. Barrett noted, takes account of citizens as opposed to bondholders and the economic powers that be who have considerable influence on the European model and approach.

I have raised many questions in a constructive manner and listened carefully to Opposition Senators' contributions.

Sinn Féin is the Opposition. It is not in government yet.

It is the lead party in opposition. I am pleased the Senator mentioned that because it is obvious that Sinn Féin is the only party in the State opposing the treaty.

What about the Socialist Workers Party and others?

I stand corrected by the Leader. The Socialist Workers Party also opposes the treaty.

People Before Profit and the other crowd also oppose it.

Yes, a number of groups oppose the treaty. That Sinn Féin is the only party in the Seanad to oppose it highlights that there is little difference between the economic policies pursued by previous Governments and those adopted by the Government.

Fáiltím roimh an díospóireacht leathan chuimsitheach. Tá sé tábhachtach go mbeadh sí againn agus í a beith meáite agus cothrom agus muid ag díriú ar na pointí tábhachtacha ins an reifreann. Beidh mé ag cur fáilte roimh tuairimí an Aire ina leith seo.

I draw Senators' attention to the fact that the treaty title, Treaty on Stability, Coordination and Governance in the Economic and Monetary Union, does not refer to growth, water charges, carers or any of the other issues raised by Sinn Féin Senators. Europe has been much too slow to take action on the euro and the current process is an attempt to bring under control the tsunami that has hit the single currency. For this reason, the treaty is long overdue. Given the control the troika exerts over Ireland, the points made about sovereignty are nothing more than rhetoric.

On the requirement to produce regular reports, I remind Senators that member states have been required to submit regular reports to the Commission since we signed the Maastricht treaty, which was not yesterday or the day before. While Ireland will be subject to greater scrutiny, so too will other member states.

It is nonsense to suggest membership of the euro is not in the country's better interests. Any step that can be taken to improve the stability of the single currency is good news. Senator Trevor Ó Clochartaigh is correct that we are facing a crisis. The number of European states with a triple A rating has fallen dramatically and now stands at only three. We are in the middle of a crisis and the sooner the European Union takes the measures required to get us out of it, the better it will be for the country. Ireland's position as a small, open economy makes comparisons with Sweden, the Czech Republic, France and Britain irrelevant.

The euro has been highly beneficial for Ireland. Before we joined the single currency, we were buffeted on the seas of economic crisis. For example, inflation was rampant in the 1970s and there were currency problems in the late 1980s and early 1990s. Within a short number of years the value of the punt had declined from £1.20 sterling to 80 cent. Stability is what we need if the country is to recover. The treaty is a very important part of regaining stability.

The treaty is not about membership of the euro.

The Senator is correct. The treaty is not about being a member of the European Union and anybody who makes such a suggestion is scaremongering. However, on the question of whether it is about membership of the euro, although that may not be the case in the immediate short term, rejection of the treaty would fundamentally undermine our membership of the euro in the long term.

It has been made abundantly clear that we will not have access to the European Stability Mechanism if we do not become a party to the treaty. While we can argue the legalities of that position, it appears to be the view of most of those who have expressed a legal opinion on the matter. As a number of leading companies which do business here have argued, if we cannot access the ESM, it will undermine the attractiveness of Ireland as a location for foreign direct investment. There is no doubt that is the message of the commentary on the issue. While one can accept or deny that reality, foreign direct investment is critical to the future of the country.

I have enormous respect for Senator Sean D. Barrett, but, as he is aware, 20 years is a long time. With a little quantitative easing and inflation, we could see a dramatic turnaround in the economy's fortunes.

I commend Senator Paschal Mooney for his excellent speech. I agree that a number of questions arise, for example, as to whether the treaty is sufficient. It probably will not be enough on its own.

I welcome the greater emphasis on growth and would not have any difficulty ratifying a growth treaty 12 months from now. We need measures to promote growth. The European Union has been too reticent in tackling the issues of growth and unemployment and too focused on the interests of core countries rather than those of countries on the periphery. As I have stated on a number of occasions, countries on the periphery need to come together in a wider European Union context. The treaty is not, however, the end of the story but one piece of a jigsaw. Growth and measures to address unemployment are other pieces of it.

The reality of the matter is that we are where we are. Nothing that is required of us in this document is anything greater than what is required of us already. All that will be asked of us is that there will be greater penalties if we do not accede. I take the point that it is difficult for a country to comply if it does not see itself currently in a position to be able to tick all of the boxes immediately, but there is a recognition for that in the treaty. There is a recognition that programme countries like ourselves will require greater leeway. We are where we are, as I said, and that is the bottom line. We have to look forward to a strong euro, to stabilising that euro and to taking the measures necessary to have a stable euro.

I also welcome the Minister of State to the House and formally congratulate him on his recent elevation.

As a nominated Senator with no experience in EU politics or in the governance of our country, today is a day that I sometimes dread, a day in which I have to contribute to debates like this. It would be easy for me not to appear in the Chamber today, to excuse myself and hope there was no vote, and then try to make some kind of decision. However, as a Senator nominated by the Taoiseach, I have a responsibility to try to make sense for myself and the community I represent, whether they are artists or whatever, on what we should do in respect of the fiscal compact treaty.

The language within the treaty itself is very clear and very understandable. Whether one disagrees with it or not is a separate issue. I will talk briefly in a minute about what Senator Zappone said about the second sentence of Part 2 of the Schedule, which is very obtuse in both Irish and English. As I read the treaty, I noticed that many of the rules in the fiscal compact treaty are already provided for in EU law. The provisions of the treaty do not alter a large part of what we are doing already in respect of the governance of our economy and our budgetary relationship. There are significant issues regarding the excessive deficit procedures, but we also know that countries which are subjected to an excessive deficit procedure have a three year transitional grace period before they have to conform to the provisions of the treaty. Therefore, Ireland would not be subject to the provisions of the existing treaty until three years after 2015, which brings us to 2018; therefore, we have a period of time to assess this.

My colleague, Senator Ó Clochartaigh, was acting in a very conciliatory fashion. Although he might be voting "No", I thought some of his points were excellent and he was being consensual in his comments, unlike his previous Sinn Féin colleague. I listened with intent and tried to understand the reasons how he might vote on this. Austerity is not mentioned in the treaty, but emotionally we are looking at somehow legitimising the austerity budgets that are going to come before us in the next few years. That is a fact, although we should not scaremonger about that either.

I was interested to hear what Tom McDonnell of TASC said. We know that there is no consensus among economists — Senator Barrett is one — about how one might approach fiscal policy. My reading of the fiscal compact treaty is that it is quite an inflexible document. That is not a judgment call, more a description, and it does tie us in. The challenge I have is to decide which way to vote. Will I accept that this one-size-fits-all inflexibility will somehow support the country to manage itself out of this crisis?

The second issue is that we must be careful to realise that the fiscal compact treaty is not a panacea. It will not resolve all our issues. It will not resolve the problems facing our management of the euro and will not resolve other measures either. I have to come to terms with that as well. The idea of the debt brake superseding other economic considerations is problematic. It can prevent governments from borrowing to make investments that pay long-term dividends, such as in education or in the provision of general purpose technologies, unless the peripheral countries have the flexibility to borrow to close their infrastructure deficit relative to the eurozone core. This is something that TASC raised and it would be a concern of mine. There is an increased inflexibility within the inflexibility. In other words, if we sign up to this and if we agree that the fiscal compact treaty is the only way, then we also have to accept that there is a greater amount of inflexibility involved.

We owe it to our fellow citizens to say it quite clearly that the communication of this is important. I commend party leaders and the Tánaiste who came out quite clearly to support it on the front foot. That has to continue and, as Senator Zappone said, clarity is required in this Bill. I am a native speaker of Irish and there are many words in the Irish version of the treaty that I just do not understand. It is really important that we learn from the very recent experience, which is the experience of the previous two amendments to the Constitution.

One of my day jobs is to sell tickets for shows and to ensure people come to see those shows. A part of that is about communicating to many different stakeholders and many different audiences. I need almost 12 weeks' notice to sell 500 seats for one night. I would not underestimate the challenge facing the Government. I strongly urge the Government to delay the date for the referendum and to learn from the Referendum Commission's report, which was laid before the Houses only on 20 April last. Regardless of whether one agrees or disagrees with the fiscal compact treaty and whether I will vote for it, which I will make known in the House, my concern is that civil servants and politicians, who are fantastic communicators, need a lead-in time for this. Today is 24 April and it is only five weeks to the referendum.

The following sentence is from Part 1 of the Schedule to the Bill:

Ní dhéanann aon fhoráil atá sa Bhunreacht seo dlíthe a d'achtaigh, gníomhartha a rinne nó bearta a ghlac an Stát de bhíthin riachtanais na n-oibleagáidí atá ar an Stát faoin gConradh sin a chur ó bhail dlí ná cosc a chur le dlíthe a d'achtaigh, gníomhartha a rinne nó bearta a ghlac comhlachtaí atá inniúil faoin gConradh sin ó fheidhm dlí a bheith acu sa Stát.

Bhí mé ag labhairt as Gaeilge ansin. Ní thuigim neart de céard atáá rá ansin. Is í sin an buairt atá orm. Tá gá leis an gcumarsáid seo. Ba cheart go mbeadh meas againn ar ár gcomhshaoránaigh ionas go mbeimid in ann am a chaitheamh ag cur fúinn. Ní chóir go mbeadh brú orainn — go mbeimid ag paniceáil, mar a deirtear i mBéarla — cinneadh a dhéanamh agus gan ach mí fágtha. That is my concern.

I will now read out two recommendations of the Referendum Commission that were laid before the House:

Reviewing as a matter of urgency the referendum process, including the statutory remit of the Referendum Commission, having regard to the Council of Europe's Code of Good Practice on Referendums (March 2007). The review should have particular regard to the need for voters to be given sufficient time, to have access to impartial information, and for a clear question being put to voters. Regard should also be had for the need to have balanced campaign material from the proposal's supporters and opponents available to electors. Allowance might also be made for either strict or proportional equality between parties rather than the current strict equality.

That is just not going to happen. We have five weeks and we are already ignoring this rule. I think that is something we should reflect upon and the message should go from the Seanad back to the Government in support of this.

I welcome the Government decision to put the treaty to the people in a referendum. The final part of this contract is that time should be given in order that some of Senator Ó Clochartaigh's friends, namely the IFA, will not be given the high moral ground and the panic button to press in terms of the emotional mood music that can get people to vote one way or the other.

The second recommendation of the Referendum Commission is to give the commission a period of at least three months to explain a referendum proposal properly. Where procurement of services is required, an additional two months is needed. The Referendum Commission was publicly attacked by some Ministers who were under extraordinary pressure in delivering highly complex information. This is a highly complex document. Simply put, the treaty is well written. My concern is about the language in the Act. My genuine concern is that time and respect would be given to our fellow citizens in order they would be able to parse this information, deliberate on it and give a reasoned view on it once all the information has been put into the public domain.

I welcome the Minister of State back to the House. I had not intended contributing but I will do so now. Before my colleague and friend, Senator Ó Clochartaigh, leaves the Chamber, I want to tell him that I am anxious to engage with some of the points he made. I have struggled to find meaning in much of what he said. I am not opposed to or in favour of what he said, I just found that some of his points lacked meaning. I will give a few examples. Sinn Féin, in its recent public utterances, is for good quality ground water but against septic tank inspections. It is for expansion of local services by county councillors but against financing them. It is against increases in the marginal rate of VAT and increases in duty, including those on alcohol and cigarettes. It is against paying its debts but in favour of a unilateral default. It is against any kind of a cutback but in favour of expanding those services. It is for massive investment and against every treaty, and it is for taxing rich people. Its members say they are living in the real world but their world is not the world I know.

Senator Ó Clochartaigh acknowledged that the State does not have the money to stimulate growth. We need to borrow money to do so. Who will give it to us? Has Sinn Féin another, unspoken reason for its opposition to the treaty? Perhaps it is because it is against fiscal responsibility. Perhaps this treaty would preclude Sinn Féin's policy of massive Government borrowing to fund massive Government overruns when, God help us, it gets into government. Perhaps fiscal responsibility is something of which the speakers in Sinn Féin are not in favour. Those are my points in response to what Senator Ó Clochartaigh said.

I spoke yesterday about the language being used around the treaty. My colleague, Senator Bacik, said yesterday that when people name the treaty, they portray or demonstrate their position on it. I was taken aback yesterday and disappointed to hear an RTE journalist on RTE radio's "News At One" refer to the treaty as an austerity treaty, not in quoting someone else but in referring to the treaty as that. It is inappropriate for our national broadcaster to use value judgments in this respect. Reporting by RTE, our national broadcaster, in its news programmes should be value free.

I am disappointed also with some sectors of the trade union movement in recommending a "No" vote in the referendum on the treaty. One union has demanded a €10 billion stimulus in return for a recommendation of a "Yes" vote. Where do the people making such statements think we will get the money to make such an investment? We all want to invest, provide a stimulus and see everyone return to work. There is nobody more anxious about that than the Government, but we have to live in the real world. We have to ask where we will get €10 billion to invest. We will be in the programme for another 12 months and we hope to return to the markets next year. The stability treaty, if passed and I hope it will be, will go some way towards creating conditions for confidence and stability to return to the markets at a reasonable rate. These are some of the points that I wished to make and I ask that they be honestly addressed. Much of the public comment I hear being put forward on the treaty is nice mom and apple pie argument, but when one examines it, it seems a bit vacuous and hollow.

Senator Barrett referred to section 8 and access to the ESM in the event of the treaty being passed or not. That section is part of the treaty. If we ratify the treaty, we will become part of it and if we do not, we will not. The preamble to the treaty suggests we have no access to the ESM. That is a matter of legal opinion and I sought one on it. It is a question of logic as well as one of legal opinion.

There is much more I could say and we will probably debate the treaty much more. I hope we will do so robustly, on the door steps and in public halls in towns throughout the country as well as in the Chamber. I look forward to that.

I wish to respond to some of the comments that were made because it is important we have a robust exchange of views on the treaty, on its implications for Ireland and on the positions being put forward by the respective political parties. A number of Senators referred to the real world. I remember a speech given by the Tánaiste, Deputy Eamon Gilmore, when he was an Opposition spokesperson and he talked about two different worlds. He talked about one world where bankers and developers were getting huge sums of taxpayers' money and were being bailed out. He talked about the people who benefited most from the Celtic tiger were the very people who were being bailed out and supported and the people who benefited least from the Celtic tiger were living in a different world and were those who were being asked to take the painful adjustments — the medicine — in terms of the budgets being put forward by Fianna Fáil and the Green Party at the time. He robustly opposed all those budgets because he felt that austerity would not work and that the budgets were unfair. Any of the Labour Party Senators present can correct me on this but I understand that every Labour Party Deputy voted against all the budgets in 2008, 2009, 2010 but magically voted in favour of the budget in 2011, even though it was broadly in line with all the previous budgets that were brought into play.

The real world is one in which 460,000 people are out of work and 150,000 people have left the country. It is where on going into any town, village or city in this State, one will see shops closing and empty premises. The real world is explained very clearly in the Bank of Ireland report published yesterday, which shows that our domestic economy is still floundering. The real world is where we have major problems, not only in Ireland but also in Greece, France, Holland, Portugal, Spain and right across the eurozone. The problem is that we are not coming up with real world solutions to the problems which are evident in Ireland and the EU. That is the point we are making. That is the flaw that is at the heart of this treaty. This treaty was designed, we are told, to solve those big problems. What the treaty does not do is put in place any new regulations around how banks operate.

Everybody in this House would accept that one of the problems that led to the collapse of the economy was the fact the public finances were built up in a construction, financial and consumer bubble. When it collapsed, the bottom fell out of the public finances. We ended up with the big deficit we have had to reduce every year. The reason that happened, and we can take Anglo Irish Bank as the perfect example because everybody accepts it is a toxic bank, was that we had international lenders who were getting cheap credit and cheap money, especially from banks in Germany and France, to lend to Irish banks. Then we had the race to the bottom between all the banks, where they all rushed to get as much money as they possibly could to give out to a golden circle, an elite in this country, who used it to speculate on land which created the property bubble which was fuelled by Government policy. These guys were also behaving recklessly by giving into banks like Anglo Irish Bank which then lent recklessly and people borrowed recklessly.

The treaty does not deal with any of that. There is not one line in the treaty that puts in place any——

It is not a banking treaty.

It does. It controls Government spending.

I am not talking about arrangements between——

It is not a banking treaty, nor was it meant to be one.

Please allow Senator Cullinane to continue, without interruption.

When the hectoring is finished, I am talking about arrangements between private banks that still operate in some parts of Europe. Even though taxpayers technically own the banks, they are still seen as private entities and we do not own them. The treaty does not deal with what any of the individuals in the private sector were doing but it deals with what Governments can do. Nothing in the treaty would have prevented the boom or dealt with the problems we have at present. The trade union leaders who are calling for stimulus measures are sensible, even if people disagree with them about the treaty. We have a gap of €15 billion and the latest figures show the general Government deficit is running at 13.1%. We must reduce that over the next few years to reach the 3% Stability and Growth Pact level.

The big issue then is where we go beyond that. We made our position clear. Sometimes people do not want to listen but we accept fiscal responsibility and have put forward a strategy for deficit reduction. We believe we must be prudent in spending, a point I made earlier this morning. In Greece there was reckless borrowing, which must be addressed, but that was not the case in Ireland where we had surpluses. We are borrowing now because the bottom fell out of the public finances when the property and construction bubble collapsed. That is why we were left with the gap we must now fill. The treaty does not deal with any of that. It also does not deal with debt. Even the IMF accepts our debt is not sustainable and that at some point we must default. The treaty introduces a debt brake that forces us to get to the 60% debt to GDP ratio; we will get to 120% in 2015 and then we have to bring it back by 5% every year after 2016 to bring it down to 60%.

I will not rehearse all of the proposals Sinn Féin has put forward. Every time we put forward our solutions, the mantra from those in the other parties is not to give them the party manifesto, but they cannot have it every way. If people want me to go through the full list I can do so but I refer the House to the contributions made when the Minister for Finance was here, when I went through the entire list, putting forward costed proposals from the Department of Finance's own figures. I do not always believe the Department of Finance but that is a different day's work.

It is a difficult decision. I am the first to accept that it is hard for all of us; there is no silver bullet or easy way out of the mess we are in. We can all accept that. No party is claiming to have a magic wand that will sort out the problems we have economically. Nor is anyone saying that if we reject the treaty, that is the end of the problems we face. We are saying that if we accept the treaty, it will exacerbate the problem and make it worse. We will see a tightening of spending in the eurozone countries with more austerity causing more problems. It is not that people are not in favour of fiscal responsibility. It is trying to do what we all want in an impossible timeframe and in a way that will exacerbate the problem in our public finances. The examples have been there to see since 2008 but we still have not dealt with the situation.

Those who oppose the treaty are very clear in their opposition in that they are looking for a different fiscal approach to reducing the deficit, and the same holds for the rest of Europe. We should not just force countries to reduce their debt to GDP ratio by making them pay back private debt. There must be an element of debt write-down, which we have not seen. If that was the case people would be more open to fiscal discipline rules.

There must also be a strategy for growth. That is the big issue. There is a difference of €15 billion between what we take in and what we spend and the Government wants a combination of revenue increases and cuts to address that. There is, however, no mention of growth. If we grow the economy and have more income, that negates the need for the painful adjustments. It makes sense, therefore, that trade union leaders who are standing up for working people who have suffered a great deal because of what has happened, want to see a strategy for growth and job creation. One Fine Gael Senator said the trade unions were putting a gun to the heads of the Government. That is not the case, they are standing up for what they believe, the people and working people in particular. They know better than anyone how the recession is impacting upon people.

We are honest about our views on this, despite some of the commentary from the Labour Party benches. We have put forward solutions and we believe in fiscal responsibility. I can rebut all of the points made by Senator Gilroy but I will not. It is not that long since Senator Gilroy was a member of Fianna Fáil.

I do not deny that.

Perhaps Senator Gilroy is a psychic and he knew the Labour Party would be the new Fianna Fáil and he jumped ship.

I have listened to every word that was said by Senators Cullinane and Ó Clochartaigh. They have not indicated a single positive result that would be achieved by voting against the treaty. That is what people need to concentrate on. What is to be gained if the country did vote against the treaty? This is a small, open economy and we need as many friends as we can get within the European Union. We have economic and fiscal difficulties and there are major problems in Europe. This treaty will not solve all the problems of Europe but it is a step along the road to protecting the euro. As previous speakers have pointed out, it is our currency and a strong euro is of benefit to us.

Senator Cullinane said this treaty will not solve the banking crisis but this is not a banking treaty. It was never designed to solve the banking crisis but it is a first step in strengthening the euro and bringing order and stability to the euro.

Much has been made of the negative comments of some trade union leaders, who are opposed to the treaty. Some of them are far removed from reality, on fat cat salaries, out of touch with ordinary trade union members. We would be well advised to listen to the chambers of commerce and the multinational companies that are creating jobs. We should listen to the farmers' organisations that are urging support for the treaty on the basis that we are better off within a strong European movement. We should listen to the small employers who are urging support for the treaty.

It is important the people face up to the realities because we cannot afford a "No" vote. Is Sinn Féin prepared to take the gamble we will not need a second bailout from the ESM? How is it going to explain to the people of Ireland that we are unable to pay salaries or maintain services?

The people will have some very serious decisions to make on polling day. I urge strong support throughout the business and farming communities. I urge those employees who are represented by some of the trade unions that are urging a "No" vote to consider the implications of a "No" vote for the country.

I thank the Acting Chairman and all the Senators who contributed to the debate yesterday and today. It was the equivalent of two Second Stage speeches all round. The rhetoric and eloquence of the Seanad remains as impressive as ever. I thank everyone for a wide ranging debate. Everything that could possibly be covered was touched on, from both sides of the argument. I welcome that.

I will not refer to everything that has been said. If I did we would be here for a very long time. I will make a few general comments and then refer to some specific areas for clarification.

It is important that we look at the treaty in its broad context. This did not happen by chance. We are in a situation none of us would have liked to be in. The treaty is not a panacea for all our ills. No one is arguing that it is. We are, however, in a serious economic situation. We are very close to being in an economic recession and this has been the case for the last four years. It is not of our choosing. A situation arose. We can cast blame in whichever way we wish, in terms of political economic or banking decisions or the manner in which regulation or lack of regulation contributed. We have an enormous debt. While the Government changed last year, the debt remained. It must be dealt with and we cannot turn our backs on it.

Our debt arises from various decisions that were made, particularly the decision to take the banking debt, as well as the sovereign debt, on board. That made the situation more complex. We have a serious sovereign debt as well as the banking debt. The previous Government entered into an arrangement through a memorandum of understanding with the IMF, the EU and the ECB to plot a pathway through the difficulties. The Government took on that responsibility and decided to deal with the situation through the memorandum of understanding and to seek to negotiate it where that was practical and possible. Steps have already been taken along that course.

Is this proposal before us, the Treaty on Stability, Co-ordination and Governance in the Economic and Monetary Union, in Ireland's interest? The Government thinks it is. It will give stability to the markets and we see daily how easily instability can be created in the marketplace. Today, alone, we see what has happened in the Netherlands. A Government fell when one eurosceptic partner in the Government withdrew because it was not prepared to face up to the forthcoming budget. How easily the markets can become negative in such a situation.

We cannot take decisions in isolation. We must recognise that this is a small country that exports 85% of everything it produces. We depend on trade to survive. We also depend on foreign direct investment to provide so much of our manufacturing industry. We are more open to the winds of the markets than, perhaps, any other country in the world. If we do not take this into consideration we are not in the land of reality. Stability is crucial for us.

The treaty proposes to provide stability and to put in place what we already have as guidelines. The Maastricht treaty included the Stability and Growth Pact requiring the maximum budget deficit of 3% and the 60% debt to GDP ratio. The structural deficit deals with the long-term cycle of a country's economy. The treaty is not a straitjacket. It exists in a broad context. It is not a straitjacket and was never presented as such. On top of those provisions we have the insurance mechanism of the ESM. That is an integral part of the treaty.

Ireland is already in a precarious situation. We need stability for markets to survive and to get back into those markets. We also need to be sure that if things go wrong, as is happening in the Netherlands, if further winds of negativity are abroad in the marketplace and if our timescale for returning to the markets in two years time is not possible, there is an available market in the European Union, which is the ESM.

We would be very foolish not to ensure that we can avail of that mechanism. By saying "No" to the treaty we would be making a statement that we will not avail of the mechanism, because it is tied in to the treaty. If we said "No" to the treaty we can only imagine how volatile the markets would become. I believe we will reach our targets and fulfil our obligations to the troika and within the terms of the memorandum of understanding, but we may very well not. We are not fully in charge of the marketplace. The global marketplace is so volatile that instead of improving, the market situation could disimprove. There could be a global deterioration in the marketplace. If we have to address that situation we will need to have access to funding.

There is nothing in the treaty provisions that is damaging to the pathway we have laid out to get ourselves out of the mire we are in and regain our sovereignty. I say to Sinn Féin Senators, in particular, that when we commemorate the events that brought about the foundation of the State and the freedom of the country we should have regained our economic sovereignty. We must focus on the steps that are necessary to do that. We should not pick holes in the steps we are taking if they are leading towards the conclusion we have mapped out. The treaty fits into that plan. It does not take from the pathway that is planned by the Government through the memorandum of understanding and our own activities.

The key issues are those of growth and jobs. The treaty is not, ostensibly, about those issues. However, by creating stability we say to the markets that we will have tighter discipline. This was already in the guidelines which were breached by some of the bigger countries, giving bad example. By accepting this discipline we make it clear that we are now in control of our housekeeping and that we expect every other European country to adhere to the same housekeeping rules. That is what the treaty is about. This is solidarity as well. There are 25 other European countries party to it. It would be great to have the Czech Republic and the United Kingdom party to it as well, but they are not. There are 25 other European countries party to this intergovernmental treaty. That is a bond and there is solidarity. From that point of view, it will give stability and will help the markets. That will also help Irish jobs and investment.

To look at it from the other side, the first thing the Government did when it came into office was to create a jobs initiative, having stated that within the first 100 days it would provide a stimulus package to create jobs. We followed that up with an action plan, the Pathways to Work scheme and a range of other measures to deal with long-term unemployment. It is difficult to do so when we do not have funding. We do not have a stimulus package and we had to impose the pension levy to get the funds together. There is not a large amount of money of which we can avail. There is a very small amount of money left in the pension fund, and we have used what we can. There is a €2.2 billion schools capital project, which has been announced by the Minister for Education and Skills, Deputy Quinn, and which will create 1,600 jobs. That is quite a substantial capital project in which we are engaging. We have got agreement from the troika that if there are sales of assets — we will not engage in any fire sale or the sale of any core asset — a proportion of the proceeds can be used for a stimulus package. That would be funding that would become available for us to use, and no doubt we would embark on that.

We have not been idle in the past while with our friends in Europe. The Taoiseach and the Tánaiste have emphasised repeatedly at all Council of Ministers and all European Council of Heads of State and Government meetings that growth and employment are key areas that have been neglected for some time by the European institutions. The Taoiseach and the Tánaiste have succeeded in getting the European Council to have jobs and growth as a central core item at every meeting. It is now on every agenda of every Council meeting. That was done by the Irish Government, not any other Government. We always saw that jobs and growth were the key to success.

I recall when I was first elected to this House in 1989 that Ireland had a debt-GDP ratio of 137%. We got out of our predicament because there was partnership and strict discipline and we created enough jobs and growth. Unfortunately, we left government in 1997, just at the time when we were creating 1,000 jobs every week, and we were not in a position to make decisions on what became the Celtic tiger and on the surplus funds that became available. That will remain the priority for the Government.

In the context of further stimulus, which has been mentioned quite a few times, we will hold the Presidency of the European Union next year. Ireland will be the country which will be in charge, as Chair and as holder of the Presidency of the European Union, when most of the decisions will be made on the multi-annual financial framework which will determine the spend of €1.075 trillion within the European Union between 2014 and 2020. That will deal with the Common Agricultural Policy, and one may bet one's life that the farmers are well aware of that because Europe has been very good to the farming community. Almost certainly, the new CAP will be finalised during our Presidency. In fisheries policy, Cohesion Funds and Structural Funds, all of the key decisions on the next six years of investment by the European Union will come under our Presidency in the first half of 2013. A great deal of funding for stimulus is available for Ireland and other European countries which should stimulate the European Union market. Neighbourhood policy is built into that for all countries not in pre-accession to the European Union and a significant level of neighbourhood policy funding goes to surrounding countries. That is another area where there will be quite a lot of stimulus.

I do not consider this an austerity treaty. One cannot describe this as such under any circumstances. Taking it within its own context, it gives stability, opens us up to investment, steadies the markets and gets us back to the bond markets in a shorter space of time. In the broader context, however, the Government has the issues of jobs and growth running in parallel with all that we are doing here, and they all fit together. One does not pass legislation dealing with jobs and growth, rather it is a question of making the policies and getting the injection of stimulus. That is what we are engaged in as well. This is a good treaty and it is good for the people.

There are issues that people might call scaremongering, such as that the treaty ensures money is kept in people's pockets by providing us with a source from which to borrow. Our sovereign deficit is more than €16 billion. That must be bridged, and we can borrow that money at 1% from the ECB. We cannot borrow it from the markets where the rates are between 7% to 8%, although that is down enormously from 14%, which it was not long ago. We must have access to funding. There is no good stating we can default. Anybody who says that is not facing reality. There are many public servants who must be paid weekly and monthly and there must be access to funding for that. There must be insurance that if we do not reach our targets within the terms we have negotiated, there is a further source of cheap funding available to us until we are able to go back to the markets. This is crucial to the decision.

A number of Members mentioned the issues of clarity and simplicity, which are crucial. It is not so much the length of time we have, as some Members mentioned, but the clarity of the information that is issued. It is good that, for the first time, the Government is doing what has not been done before and would have been difficult to do in the case of the Lisbon treaty. I was involved, as director of elections for the Labour Party, in the second Lisbon treaty referendum. It was difficult to get such a treaty out to the people because it was a huge document and merely referred to other treaties. The Lisbon treaty did not have a meaningful text of its own and it was almost impossible to get to the members of the public a meaningful text they could read. It would have been virtually impossible to have provided an explanatory memorandum.

This is a simply treaty and a simple matter on which people will vote. It looks like legal text, however, and we need the memorandum. The treaty itself will be given to everybody by the Government, along with an explanatory memorandum and a further leaflet. These will be for the purposes of information and explanation. That is what people were crying out for during the Lisbon treaty referenda. They want to see neutral information explaining what is before them, and once they have that, they will be satisfied rather than frustrated or angry, and they will make up their minds. Irish citizens are well capable of making a decision as they see fit. Our job is to facilitate them in doing so.

Senator Sean D. Barrett referred to the references to the European Stability Mechanism, ESM, in the treaty. To clarify, the preamble to the treaty which makes reference to the ESM is part of the text. It should be read together with the main body of the treaty, its purpose being to show how the treaty is to be interpreted and applied. It is an integral part of the treaty. Article 2 deals with the relationship between the treaty and EU law and is not relevant to the functioning of the ESM which will operate under an intergovernmental treaty. These are completely separate issues which should not be connected. The ESM and access to it are stand-alone issues. If we cannot return to the markets to raise money at low interest rates, we must have a backstop. That is simple and straightforward. It makes no difference whether these provisions are set out in the preamble to the treaty or in one of the articles. I hope that clarifies the point raised by the Senator.

I accept Senator Katherine Zappone's point that this is a complicated text. I recall that when the former Tánaiste and Minister for Justice, Equality and Law Reform, Michael McDowell, undertook a consolidation of the criminal justice legislation, we encountered legislation from the 18th and 19th centuries which was totally unintelligible. That is not to say, however, that modern legislation is always easily intelligible. In fact, we are always provided with explanatory memorandums. Having said that, the amendment is set out as a standard text, similar to that brought forward in respect of the Lisbon treaty. It is not something new but merely what is required, as determined by the Attorney General. The second sentence of the amendment is intended simply to facilitate the introduction of legislation in accordance with the treaty, namely, the laws we will design such as the fiscal responsibility Bill. Its purpose is simply to facilitate us to produce the required legislation in keeping with our long tradition of honouring our international obligations. It is important to note that there is no ceding of sovereignty, rather it is about the honouring of obligations. The legislation will be presented in the normal fashion to the two Houses of the Oireachtas and will be debated therein. It is we who will make the decision on the substance of the legislation in the context of the treaty.

Senator Fiach Mac Conghail asked when the treaty would begin to impact. We are on a path to correct our excessive deficit up to 2015 and would, therefore, expect to become subject to the so-called preventive arm from 2016 onwards. The Senator is almost correct — we will have a three year transition period, but it will be from 2016 to 2019 rather than from 2018.

Senators David Cullinane and Senator Trevor Ó Clochartaigh made several points on behalf of the Sinn Féin Party. If the treaty is not ratified, Ireland will clearly still be a member of the European Union, about which there is no question. However, a failure to ratify will, of course, raise doubts in the market and undermine investor confidence. The question is whether we want to stay at the heart of the eurozone, on which the Government's view is that it is extremely important that we do so. We have always said this and I am confident everybody in the House agrees with it. The treaty enables us to do so. To clarify, it is not an EU treaty but an intergovernmental treaty signed by 25 of the member states. We should be careful not to confuse voters in this regard.

On the question of bringing a legal action to the European Court of Justice, the Commission is not permitted under the treaty to do so. Article 8 provides that the Commission will make a report on how each contracting party implements the debt brake provision of the treaty. If it finds that a contracting party has not implemented the provisions properly, another contracting party, that is, another member of the European Union but not the Commission, may bring legal proceedings. The Commission has an oversight role, as it has in every matter dealing with treaties, but it is only individual member states that may take an action to the European Court of Justice. If the court finds that the member state in respect of which the complaint is made has not properly implemented the debt brake, it will be given the chance to set its house in order. It is only where it fails to do so that a second set of proceedings may be brought seeking the imposition of a fine. What is envisaged is a democratic process involving the member states of the European Union. It is a careful process in which nothing takes place in an emergency or a high-handed fashion.

On the status of the European Central Bank, we have long argued for a more robust role for it. In this context, we welcome the recent moves to make additional liquidity available. However, there is a great deal more the bank could do. For example, we have called on it to review how it can support efforts at recovery, an area in which Ireland will continue to engage.

Senator Paschal Mooney spoke eloquently about confidence in the markets, including investor confidence. I am delighted that Fianna Fáil is supporting the treaty and that its Members have spoken strongly to that effect in both Houses. It is all about restoring the stability required in respect of the euro in order that the economy can continue to grow and provide more employment for citizens. On the other side, the uncertainty that would arise following a rejection of the treaty in the referendum would completely undermine the prospects for stability and the progress of efforts to create jobs and so on.

The measure before us does not seek to solve all of our problems, but it does represent a step along the road to recovery. That is as much as we can say. It is in line with what is required, namely, a level of internal discipline within the European Union. A great deal has been done in terms of the regulation of the financial sector and the rules in that regard are in place. The six pack, the forerunner to the treaty, has been presented. The treaty tightens these arrangements by providing for a statutory provision. Side by side with this, we are focused on the job creation mechanisms required. We have succeeded in encouraging the European Union to make this the first priority and we must now exert pressure to ensure that this remains the case. There will also be a need for the ECB, the European Commission and other institutions within the Union to ensure that the necessary requirements, including a focus on borrowing and stimulus packages, will be placed at the heart of what is done as the member states move forward.

The first step we must take is to vote in the referendum at the end of next month. We must, therefore, ensure that the people understand exactly what is involved. Those of us who believe that the treaty represents the right way forward must knock on doors and convince people that it is good for Ireland and its citizens and is a step forward in the context of recovering the economic sovereignty we have lost. We would like everybody to assist us in achieving this.

The only people who would describe this treaty as good would be those in the Tea Party in America. Those individuals would be very proud of the treaty and what it seeks to do. This debate is marked by a dichotomy which goes to the heart of the treaty and the language people use to describe it. For example, the Minister of State refers to it as a stability treaty and he actually used the word "stability" on perhaps 30 occasions during his contribution. He also stated that it is not an austerity treaty. However, he and other Government representatives have informed us that the treaty is aimed at reducing our deficit. To do this, the Government must ensure that we adhere to the targets and rules contained in the treaty. The latter will obviously involve making adjustments to budgets. In turn, such adjustments will obviously involve austerity. If the Minister of State is in a position to offer a different interpretation of what is meant by "austerity", perhaps he will make it known to the House.

The Minister of State referred to clarity and simplicity. Such clarity and simplicity must relate to what the treaty will do and what will be the real problems. A number of Government representatives, including the Minister of State, have indicated that the treaty is not about private debt or what is happening with the banks. They have also stated that it is not primarily about jobs but that it is rather about fiscal discipline. Therein lies the problem. The main difficulties Ireland is experiencing involve unsustainable levels of debt and a lack of growth and investment. Many people are asking what the treaty is all about, particularly as it does not deal with the real problems we face.

There will be another treaty for that.

Here we go again with the interruptions. What is involved here will place a straitjacket on future Governments in the context of their being in a position to manage and control our budgetary and fiscal affairs. It is not possible to state that the treaty imposes very strict rules in respect of fiscal discipline and then state that it will not place future Governments in a straitjacket.

The Minister of State also referred to returning to the bond markets and he again peddled a particular view in respect of ESM funding. I have a number of direct questions for him on this matter. The Tánaiste, Deputy Gilmore, stated at the Labour Party conference that Ireland would return to the bond markets within two years. How will this be achieved? If it is achieved, I am sure the Minister of State will accept that we will not then require access to ESM funding. Does he also accept that the ESM treaty is different to that which is the subject of the Bill? Does he further accept that Ireland has a veto when it comes to the implementation of the ESM treaty? The Minister of State indicated that it would be very foolish for the Irish people to reject access to ESM funding. This is where the difficulty lies. We are being informed that we will not require such funding because we will be returning to the bond markets but at the back of people's minds is the fact that access to the ESM is a form of insurance policy.

The treaty to which the Bill relates is an intergovernmental treaty. A number of individuals, including the Minister of State, have said that we will not be out of the euro, the eurozone or the European Union if we vote "No". If we do vote that way we will, like Britain, simply be rejecting the fiscal discipline rules. It will still be open to other countries to proceed with the treaty if they so wish. However, the question arises with regard to whether the Dáil has a vote in the context of the approval of ESM funding. I understood the Taoiseach to have stated that said vote will be taken when the people have made their decision. My question for the Minister of State in this regard is very simple. If the people vote "No" in the referendum, will his party recommend that we should approve the ESM treaty and, essentially, prevent ourselves from accessing the funding involved? Will the Government do the sensible thing if there is a "No" vote and state that the people have spoken in respect of the fiscal discipline rules, that the position on ESM funding is different, that we have a choice and that we are saying "No" to what is proposed in respect of the ESM and that the rules can be changed in order that Ireland, if necessary, might obtain access to ESM funding? The issue in this regard has been resolved. Before now, we would have been putting the cart before the horse by holding the referendum after we accepted the ESM funding. I hope a response in respect of this matter is written on the piece of paper that has just been handed to the Minister of State.

That was a nasty thing to say.

Senator Cullinane to continue, without interruption.

I will forgive the interruptions. If we vote "No" in the referendum, what choices will be left open to us in the context of the ESM treaty? Regardless of the way in which the people vote, what will be the process for the implementation of that treaty in the aftermath of the referendum?

The Minister of State referred to the very important and forthcoming anniversary of the 1916 Rising. He said that as we move towards 2016 we will hopefully get back into the bond markets, reclaim our sovereignty and achieve everything the Government has stated it wishes to achieve. It will be interesting to see whether any of this happens. The 1916 Proclamation refers to "cherishing all of the children of the nation equally" and to the nation having control over its affairs and destiny. Giving more powers to Europe, the European Commission and the European Court of Justice in respect of how we run our budgets, etc., runs contrary to what is contained in the Proclamation. All the children of the nation have not been cherished equally in response to the economic crisis. I do not believe anyone could raise his or her hand and state that there is anything fair about what has been done. The reality is that not one of those who were responsible — be they bankers, developers or whatever — for the huge mess that has created massive economic distress for working families has been imprisoned.

Will the Minister of State spell out in clear terms what will be the process in respect of the ESM funding? Will he outline his view on what will be the Government's approach if the people vote "No" in the referendum and if we are obliged to then make a choice on the ESM treaty?

As far as I understand it, the treaty is about fostering long-term budgetary discipline and, as the Minister of State indicated, increasing levels of internal discipline. I find it terrifically difficult to understand the opposition Sinn Féin is offering to this. I have tried really hard to come to terms with Sinn Féin's position but I cannot do so because it does not make any sense.

The treaty will not work.

We have emerged from a period when there was a lack of discipline and regulation and when rules were bent, broken, ignored, abandoned, etc. The latter explains, in some part, why we are in the mess in which we find ourselves. Senator Cullinane can shake his head all he likes but what I have said is true. I would have thought that a level of internal discipline to which we can all sign up in equal part makes plain common sense.

I ask people to imagine for a moment representatives of Sinn Féin sitting in the boardrooms of companies such as Microsoft, Hewlett Packard, Abbott Ireland, Facebook, Google, etc.——

Martin McGuinness has done so and he has brought jobs to the North. We are well used to being in those boardrooms.

With respect, the Senator is talking about another jurisdiction and one in which this referendum will not be put.

Ours is an all-Ireland party.

I am talking about Sinn Féin's argument, the one it would put to those people who may be deciding to invest in Ireland because they believe economic progress is being made here, albeit slow, painful and difficult. I would love to hear how Sinn Féin and others who oppose this treaty would explain to those wishing to invest in Ireland how budgetary and internal discipline is not a good development. The fact is Sinn Féin never gets challenged to do this. Its members are able to talk at great length involving all kinds of things but they have never been in the position as members of the Government having to talk about policy and budgetary rules to companies considering investing in Ireland. Effectively it gets away with its own imaginative play on words, trying to persuade the public to vote "No" when we all know job creation is important. The only way we can achieve future job creation and encourage companies to consider this small island off the Atlantic as a place worth investing in is by continuing to rebuild and believe in ourselves. This is only one small piece of an enormous jigsaw.

The Europe 2020 vision for the social market economy has headline targets which must be translated to national targets. We have to strive for 75% of the population to be employed. Up to 30% of EU GDP must be invested in research and development over the next five years. It also sets out climate and energy targets, the taking of millions of people out of poverty and all school leavers having a diploma. These are real targets for which the Government will be responsible for achieving, albeit far more slowly than most of us would like. Voting for this treaty will be a step in that direction because it will bring discipline across the Union.

I must remind Members that we spent three hours yesterday on Second Stage and we are now almost three hours on the Schedule this morning. We are due to complete the Bill before 3 p.m. The Minister of State has responded in detail already and I am not going to inhibit his response. However, we must bear in mind our time constraints.

Regarding Senator Cullinane's query about the European Stability Mechanism, ESM, that is dealt with by a separate intergovernmental treaty. We cannot veto the ESM treaty. It is required to be ratified by member states whose initial financial contribution to the ESM is 90% of the total. All member states must ratify the amendment to the treaty on the functioning of the EU that refers to the ESM. That amendment, however, will not necessarily establish the ESM.

Senator Cullinane then referred to cherishing the children of the nation equally. How can anyone who wants to cherish the children of the nation not vote for the ESM treaty? We need it to ensure we have maximum surety and stability and can avail of the assistance of necessary funds. Without having the ESM in place, there is no guarantee that we will be able to go to the markets. Anyone in their right mind would be in favour of the insurance mechanism which is the ESM. I would have thought Senator Cullinane would have recognised that and how it is a natural progression to an insurance mechanism as contained in the treaty.

This treaty is part and parcel of the pathway forward that the Government has planned and is working through effectively. We recently had the first economic growth in the past four years. Our export markets are very effective. Agrifood businesses have done extraordinarily well with a 30% increase in farmer earnings last year. There is light at the end of the tunnel. This treaty fits into the planned pathway to recovery by providing terms of fiscal discipline, stability and structure. The Government is also focused on growth and job creation.

This treaty is a good package. It is important to sell it to the people and ensure they know what is intended. I thank Senators for their wide-ranging and knowledgeable contributions. No issue was left out and I thank both sides of the House for their arguments. It is important we tease out in detail all the elements of a measure as important as this treaty which will be presented to the people.

Cuireadh agus aontaíodh an cheist.

Question put and agreed to.
Aontaíodh ailt 1 agus 2.
Sections 1 and 2 agreed to.
Aontaíodh an Réamhrá.
Preamble agreed to.
Aontaíodh an Teideal.
Title agreed to.
Tuairiscíodh an Bille gan leasuithe agus glacadh é chun an breithniú deiridh a dhéanamh air.
Bill reported without amendment and received for final consideration.
Cuireadh an cheist: "Go rithfear an Bille anois."
Question put: "That the Bill do now pass."



Will the Deputies claiming a division, please, rise?

Senators David Cullinane, David Norris and Trevor Ó Clochartaigh rose.

As fewer than five Members have risen, I declare the question carried. The names of the Members dissenting will be recorded in the Journal of Proceedings of the Seanad.

At least, we stood by the Republic.

Faisnéiseadh go rabhthas tar éis glacadh leis an gceist.

Question declared carried.