Tuesday, 27 May 2014

Questions (13)

Michael McGrath

Question:

13. Deputy Michael McGrath asked the Minister for Finance his views on the length of time it takes the European Commission to approve budget day announcements which are subject to state aid rules; and if he will make a statement on the matter. [23034/14]

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Written answers (Question to Finance)

The EU's State Aid rules are in place to protect the Single Market and to ensure that the resources of a Member State cannot be used in a way which would create distortions in the market, either domestically or throughout the EU, and provide certain market sectors with a competitive advantage. As a small, open, export-led economy, Ireland is a keen supporter of the Single Market and we fully support the European Commission's approach to protect the integrity of the Single Market.

Occasionally, Member States will wish to use their resources, either by way of direct grants or tax reliefs, to encourage a particular activity. The EU's State Aid rules preclude such measures except in very specific defined circumstances, such as promoting culture or heritage conservation or to promote economic development in deprived areas. The Commission have very strict criteria against which they assess any proposals from Member States in this area.

It is reasonable to assume that the European Commission receives a large number of this type of proposals from Member States, all of which have to be thoroughly examined. While the process might seem lengthy, it is an important safeguard in the context of a Single Market which Ireland strongly supports. I am sure that we would all like to see the process move a lot faster but equally there is a need to get it right.