Tuesday, 19 February 2013

Questions (9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23)

Micheál Martin

Question:

9. Deputy Micheál Martin asked the Taoiseach if he circulated any papers at the November European Council meeting; and if he will make a statement on the matter. [53796/12]

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Micheál Martin

Question:

10. Deputy Micheál Martin asked the Taoiseach the questions on European Affairs that are replied to by his Department; and if he will make a statement on the matter. [53799/12]

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Micheál Martin

Question:

11. Deputy Micheál Martin asked the Taoiseach if he circulated any papers at the recent EU Council meeting; and if he will make a statement on the matter. [55220/12]

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Micheál Martin

Question:

12. Deputy Micheál Martin asked the Taoiseach if he will outline the particular areas he plans to discuss at the December European Union Council meeting; and if he will make a statement on the matter. [55452/12]

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Micheál Martin

Question:

13. Deputy Micheál Martin asked the Taoiseach if he met or spoke to Prime Minister Monti at the December meeting of the EU Council; and if he will make a statement on the matter. [56516/12]

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Micheál Martin

Question:

14. Deputy Micheál Martin asked the Taoiseach if the economy in Italy was discussed at the December meeting of the EU Council; and if he will make a statement on the matter. [56517/12]

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Micheál Martin

Question:

15. Deputy Micheál Martin asked the Taoiseach if the latest Doha agreement was discussed at the December EU Council meeting; and if he will make a statement on the matter. [56518/12]

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Micheál Martin

Question:

16. Deputy Micheál Martin asked the Taoiseach if the situation in the Middle East was discussed at the December EU Council meeting; and if he will make a statement on the matter. [56519/12]

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Micheál Martin

Question:

17. Deputy Micheál Martin asked the Taoiseach if unemployment was discussed at the December EU Council meeting; if any actions were taken; and if he will make a statement on the matter. [56520/12]

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Richard Boyd Barrett

Question:

18. Deputy Richard Boyd Barrett asked the Taoiseach if he will report on the European Union summit on 13 and 14 December; and if he will make a statement on the matter. [56784/12]

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Richard Boyd Barrett

Question:

19. Deputy Richard Boyd Barrett asked the Taoiseach if he raised the issue of jobs and growth for Ireland at the European Union summit on 13 and 14 December; and if he will make a statement on the matter. [56786/12]

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Gerry Adams

Question:

20. Deputy Gerry Adams asked the Taoiseach if he held any bilateral meetings on the margins of the December 2012 EU summit. [2330/13]

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Joe Higgins

Question:

21. Deputy Joe Higgins asked the Taoiseach if he will report on the meetings that took place at the EU summit on 22 November. [2340/13]

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Richard Boyd Barrett

Question:

22. Deputy Richard Boyd Barrett asked the Taoiseach if he will provide a list of upcoming European Council meetings which he will attend and issues he intends to raise; and if he will make a statement on the matter. [2757/13]

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Micheál Martin

Question:

23. Deputy Micheál Martin asked the Taoiseach if the issue of strenghtening EU banking regulation has been discussed at EU Council meetings; if there has been any progress on this issue; and if he will make a statement on the matter. [5093/13]

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Oral answers (18 contributions) (Question to Taoiseach)

I propose to take Questions Nos. 9 to 23, inclusive, together.

I attended the meeting of the European Council on 22 and 23 November which aimed to reach agreement on the multiannual financial framework. Following productive discussions, it was decided that a little more time was needed to bring positions closer together and that, while we would maintain intensive contacts, we would return to the matter at a later time.

While I did not circulate any papers at the November European Council, in my bilateral contacts with President Van Rompuy and President Barroso, and in the meeting proper, I set out very clearly Irish concerns and priorities concerning the MFF. I subsequently followed up on a number of points in writing with President Van Rompuy.

I am happy to report to the House that the negotiations on the multiannual financial framework were finalised at the meeting of the European Council on 7 and 8 February. As I stated to the House last week, I believe the deal is a good one for Ireland and for Europe, one that fully protects our vital national interests - including in providing for a strong CAP - and recognises the impact of the economic crisis on this country through special allocations to the BMW region and under rural development funding. In addition, Ireland will be able to access a new €6 billion fund to tackle youth unemployment.

The February European Council also adopted substantial conclusions on trade. Leaders agreed that the immediate priority must be to develop our bilateral trade agenda. The Irish Presidency had already set out an ambitious agenda in that regard, prioritising negotiations that provide the most benefit in terms of growth and job creation. In that respect, progressing the EU-US trade relationship is a particular priority.

In his State of the Union address last week, President Obama provided a significant impetus when he announced that talks would be launched on a comprehensive transatlantic trade and investment partnership. This was followed the next day by a joint statement from President Obama and Presidents Van Rompuy and Barroso in which they undertook to initiate the internal procedures necessary to launch the negotiations. This is a very significant development. Let me assure the House that Ireland, as Council President, we will spare no effort to make the maximum possible progress on this issue during the rest of our term, with a particular focus on securing a negotiating mandate within the Council.

I attended the meeting of the European Council on 13 and 14 December in Brussels. As I have already made a statement to the House on this meeting, I will merely give a summary of its proceedings. Discussions focussed on President Van Rompuy's final report on strengthening economic and monetary union, and good progress was made on a number of fronts, including banking union. Building on an agreement in ECOFIN on the eve of the summit, the European Council called for early agreement with the parliament on the single supervisory mechanism. That work is now well under way. Establishment of the SSM will pave the way for possible recapitalisation of banks by the ESM, and the European Council called for an operational framework for this to be agreed as soon as possible.

The December European Council also agreed conclusions on the annual growth survey and the European semester process, the Single Market and unemployment, including the adoption of the youth guarantee in early 2013. In addition, the European Council asked the High Representative to prepare for a discussion of the Union's Common Security and Defence Policy in December 2013. We also had a discussion on Syria.

I am responsible before the House in respect of my role as a member of the European Council. The Tánaiste and Minister for Foreign Affairs and Trade retains overall ministerial responsibility for the co-ordination of EU affairs. Parliamentary questions on European matters are answered on that basis.

The next meeting of the European Council is scheduled for 14 and 15 March. The draft agenda for that meeting will focus on concluding the first phase of the European semester process and, in that context, the state of implementation of the compact for growth and jobs. Next month we will have an exchange of views on relations with strategic partners and address other foreign policy issues, as necessary.

Further meetings of the European Council are scheduled for 22 May, and 27 and 28 June.

That is about 29 questions together.

All of which relate to Europe.

I am not complaining.

I know Deputy Martin appreciates my going against all traditions and advice.

I would not over-state it.

The advice is consistent anyway.

Yes, I know.

It must be noted that the majority of these questions were tabled three months ago. We would welcome if the Taoiseach could be in the House two days a week to deal with questions.

I will give shorter answers if the Deputy wishes.

Prior to this Government taking up office it was the norm that Taoiseach's Questions were taken on a Tuesday and Wednesday. Were the Taoiseach to do so, questions could be progressed much quicker than is currently the case. For example, we are nearing the end of February and are only now dealing with questions in regard to the December summit.

The Taoiseach referred in his reply to individual developments within the Union. What is Ireland's policy in regard to the development of the European Union? The work being undertaken by Mr. Van Rompuy is about setting the pathway for a different type of Union. There is no doubt the Union will face major issues in the coming years. A new treaty is to be discussed. What is the Taoiseach's view on the British Tory Party seeking to roll back 30 years of development in the Union and his position on the demands of the British Government as articulated by the Tory Party Leader and Prime Minister, Mr. David Cameron? The difference between the speed of developments within the eurozone as opposed to the broader Union is becoming clear. What is our position on this? The future of the Union is at this point in time being defined. What is the Government's position on all of this? Where does it stand in relation to the proposals for different levels of integration with the European Union? Also, what new reforms does the Taoiseach support in the context of the European Union? Given the relocation of the EU division from the Department of Foreign Affairs to the Department of the Taoiseach, these basic questions on EU policy fall to the Taoiseach to answer and give some direction on.

There has been a huge gap in terms of Ireland's position on the future evolution of the European Union given all that has happened in the past two to three years and the perspectives emanating from different member states. Ireland should at the very least develop a position on these fundamental issues. Also, the Oireachtas should debate these issues. An opportunity should be provided for the Oireachtas to debate either a White Paper or Green Paper on future European Union integration, the development of the Union and all institutions of the Union, including the European Central Bank.

Mr. Jacques Delors, a founder of the European Central Bank, accepts that the treaty provisions regarding the European Central Bank should be changed. Does the Irish Government support changes to the statute of the European Central Bank and how it operates? The banking union referred to by the Taoiseach is not in accordance with the original vision of a banking union. It is clear there will be no common resolution of the regime or deposit insurance and that a number, if not most, banks will escape common regulation. Many banks, in particular German banks, are resiling on the need, as first articulated and repeated at the June summit, for a banking union.

On the broader issue, what is the Government's policy on the European Union over the next number of years?

As I have outlined on many occasions at the European Council, European Parliament and other meetings Ireland supports the development of the Union to its full potential, including the development of the Single Market and digital market. We need to develop the unconcluded agreements on trade with Canada and the Far East and to implement the framework agreement on EU-US trade which, as the Deputy will be aware, have the potential to create almost 2 million jobs and to increase the economies of the Union by at least 2%.

On the Government's view of the Union, the founding principles of the European Union are that big countries work with small countries, a demonstration of which is the assistance currently being provided to governments working in challenging circumstances as committed to by Europe. The more one helps oneself the greater the demonstration of assistance. After 40 years, Ireland remains a recipient country from the Union. We would like to believe that in time and with proper competency Ireland could be a net contributor to the European Union. This requires us to develop our economy and sort out our problems, thus proving we can be, like other countries, competent, competitive and attractive in terms of location for investment, thus giving our people the opportunity to give vent to their flair and creativity.

I have answered the question about Britain on a number of occasions. The Prime Minister has set out his stall in terms of the repatriation of certain powers from Europe and his view of the British people having an opportunity to decide by way of referendum in 2017 whether Britain should be part or not of Europe. Ireland has been closely aligned with Britain for many years in terms of trade, business and so on. We do not want to disrupt this. The Deputy will be aware that the verdict of the fiscal responsibility referendum was 60:40 in favour of the euro and eurozone from an Irish point of view. The European Union would regard the tradition of Britain being the driver of the Single Market as important. The European Union and Leaders regard Britain as an important element of a new emerging Europe. It is important to reflect again that 90% of the world's trade over the next ten years will take place outside the European Union. For this reason, I would like to see European Union leaders begin to focus on the real priorities such as the implementation of a eurogrid in terms of energy. We are currently losing out in the context of the increasing independence of the United States in terms of energy capacity from shale, gas, oil and so on, which means that costs for major investments in the United States have and will continue to drop and will increase in Europe as a consequence. This is not good. We also need to take account of the aging society in many European Union countries and how we propose to deal with it in terms of the provision of services.

The European Union comprises the largest collection of well developed economies. There is no reason we cannot bring this to a new level with the second greatest economic block in terms of the United States and all it yields. Through Ireland's presidency of the European Council we are trying to make an effective impact across a thousand different fields for the good of the Union, which also helps us. As an exporting country, we need to be lean and competitive and to be able to export quality goods worth €500 million into that market. It is important to note that the new Europe will have to take interest in what is happening across the Mediterranean in North Africa and the Middle East. This is an issue on which Europe needs to reflect carefully. It is also important to note that many countries in North Africa are growing by 5%, 6% and 7%, which presents trading opportunities for a country like Ireland.

In the context of the Union as we know it, we are not reaching our potential because of the struggle and challenge faced by many countries in the eurozone and Europe as a whole. As a Union with a population of 500 million people we have enormous potential to increase that. We support enlargement.

Croatia expects to join on 1 July. I have had meetings and the Minister of State, Deputy Creighton, has been to all of the applicant countries, from Montenegro to Serbia and everywhere else, which want to make a case for joining the European Union once they can comply with all of the conditions required. This is our position on Britain and generally in so far as the Union is concerned.

Through the chairmanship of the Minister for Finance, Deputy Noonan, we have allowed the financial transaction tax to go to a working group with enhanced co-operation. While we disagree with this we have not held it up because more than 11 countries support it. Banking union is one area where the finance Ministers were in a position to make a recommendation on time. Following the decision of 29 June, a single supervisory mechanism architecture was established prior to Christmas and approved by the Ministers on the day before the European Council meeting where it was also approved. It is now a part of the discussions which apply. It is expected the architecture for banking union and the single supervisory mechanism should be in place by June, and I hope it is, but I cannot see it being effective or implemented until late this year or, more than likely, 2014. The discussions taking place on the possibility of the ESM being allowed to recapitalise banks is part of these discussions and a working group is being established to consider the principle of extending the maturity dates which applied to Greece so they are also applicable to Portugal and Ireland. They will report back in March. If it is accepted it is of potential benefit to the country.

The programme of the Presidency is to deal with approval by the European Parliament of the multi-annual financial framework. I was to have a meeting this morning in Brussels with President Barroso and President Schulz at 7 a.m. but it was not possible for President Schulz to attend so it has been postponed. We have a responsibility to engage with the various sectors in the European Parliament to get this through, as consensus is required under the Lisbon treaty. Reform of the CAP is of direct interest to us. Ireland is working with our counterparts on 70 pieces of legislation to run an effective Presidency over the course of the next three to four months. It is a very packed agenda.

I see a real necessity for leaders to focus on the bigger picture in a global sense so that Europe has the potential to play its real part. Given the amount of trade taking place outside the borders of the European Union we have a major challenge ahead of us but also huge potential if we have the political will and agreement to get our affairs working as we all know they can.

Most of these questions are about the December summit so we must agree they are dated although this is nobody's fault. The way they are now grouped is better and I thank the Taoiseach for this and I welcome it. We should continue to examine ways we can get the most benefit from Questions to the Taoiseach. Since the budget was announced in December we have had the deal with the ECB on the promissory note. Prior to the budget we had the June announcement and the Government's claims the objective of separating bank debt from sovereign debt had been put together. Last week, bank debt was converted into sovereign debt which strikes me as being a very big contradiction. What is the status of the Eurogroup's decision of last June given what occurred at the most recent summit? I stated at the time the Taoiseach was overselling the June deal and I made the same point with regard to the recent promissory note arrangement.

On the day the deal was agreed we were told by Government spokespersons it would mean a €1 billion saving. The big question for most citizens is what does this mean to them. SIPTU has called for the money to be invested in a job creation stimulus. Will it be used for job creation or to lessen the burden of austerity? Will the Government be able to do away with the property tax? Will child benefit or carer's allowance be restored? What will happen with regard to the €1 billion which the Taoiseach states has been saved? What progress can be made in the short term given the Taoiseach's claims about the deal? What is the status of last June's decision to separate banking and sovereign debt?

There are already indications that the deal on the IBRC which the Taoiseach trumpeted as historic will face objections from Germany in particular and possibly elsewhere, and that the Government will not be allowed to in any way attempt to use the claimed savings to the State of €1 billion next year and €1 billion the year after to pull back or alleviate in any way the austerity which has been imposed or which the Government plans to impose under troika arrangements or as conditions or targets of the fiscal treaty. Has this been indicated to the Taoiseach? Was it indicated at the December summit? Will our EU so-called "partners", particularly Germany, prevent the Government passing on any benefit of the supposedly historic deal on Anglo Irish Bank to citizens who are being hammered with austerity? Will the Taoiseach clarify this? If this is not the case will the Taoiseach clarify precisely what benefits can be passed on to ordinary citizens to alleviate the burden of cuts and austerity, or using the extra savings the Taoiseach claims to have as a result of the deal for financing a stimulus jobs programme or a programme of economic growth? The President of the ECB, Mario Draghi, is now discussing possible legal problems with the IBRC deal, and even the possibility of legal action being taken if the deal breaches ECB rules on monetary financing. Will the Taoiseach clarify whether this was discussed with him previously? Was it signalled this might happen? Did the Taoiseach fully proof the deal to ensure it would withstand any such legal challenges from the ECB or any other quarter in terms of its legality under ECB or European regulations?

I must say we are stretching this a little as I do not see any question on the Order Paper on the recent agreement. Perhaps the Taoiseach wishes to respond.

I will keep it brief. Deputy Adams asked about the status of the European Council decision of 29 June. It is as it was. The decision was to break the vicious circle between sovereign and bank debt, taking into account the particular analysis of the well-performing programme in Ireland, that equal cases would receive equal treatment, and that following this the architecture of the single supervisory mechanism would be set in place. These discussions are under way. The decision of the European Council stands and has not been changed or revoked. It is now being followed through.

In regard to when that will apply, it would be great if they could agree on the architecture for the single supervisory mechanism by June. Obviously, however, it will be the back end of this year or into next year before those complex discussions can conclude. Separate from that, if the question of the extension of the maturity applied to Greece is applicable to Portugal, which tabled this, and to Ireland it would be to our benefit as well.

With regard to the sum of €1 billion being saved, this also goes into the question raised by Deputy Boyd Barrett. We have set out our stall as a country that is in a programme with the troika to get our deficit below 3% of GDP by 2015. The borrowing requirement is €12 billion this year, €9 billion next year and €5 billion in 2015. There is no question but that these are challenging times. However, this is about rectifying fundamental problems in our public finances and the economy to get to a point where we can start recruitment programmes again in a more structured way to deal with front-line services.

Deputy Boyd Barrett spoke about Mario Draghi, the president of the European Central Bank, who referred to this at the economic affairs committee of the European Parliament yesterday. It is fair to say that since the decision was made, the IBRC has been liquidated, the promissory notes have been replaced by long-term bonds, the first repayment is not due until 2038, Standard & Poor's has changed its view of the country, Irish Life has been sold today - which gives back over €1 billion to the people in respect of what was put in there - and Facebook has announced extra jobs.

I can confirm that the line of investment in here continues to be very strong. Hopefully, in due course, the bank guarantee will go, which will allow banks to be out in the markets themselves. That will also allow greater flexibility for credit to be available for lending to small and medium enterprises which are the backbone of future growth in the economy.

As Deputy Boyd Barrett is aware, we are only in February. We have set out the budgetary programme for 2013, which is challenging for a number of Departments, but it has to be achieved. As we move through the year towards the back end, the Government will set out its position in so far as the budget for 2014 is concerned.

With respect, that is not what I asked the Taoiseach.

The Minister for Finance and other Ministers will be engaged in that process. The current talks are now at a critical stage and I do hope that everybody can get involved in those discussions again. These are wage negotiations between the Government, employers, management and unions. I do hope that they can settle down to focus again on the issues at hand and come to a decision very quickly in respect of the savings that can be achieved.

Written Answers follow Adjournment.