I move:
That Dáil Éireann takes note of the White Paper entitled Membership of the European Communities: Implications for Ireland.
The decision to issue a White Paper on the implications of membership of the European Communities was taken by the Government following The Hague Summit Conference of December, 1969, at which the member states reached agreement in principle on the opening of negotiations with the four applicant countries. The indications were that negotiations would open about the middle of the year and the Government felt, in these circumstances, it would be desirable to make available a document setting out what membership of the Communities would involve.
The earlier White Papers of 1961, 1962 and 1967 had been aimed at giving a factual account of the provisions of the Treaties of Rome and Paris and the action taken in implementing the treaties. As Deputies are no doubt aware the formal opening of negotiations will take place in Luxembourg on June 30th. Following this the Community will have meetings at ministerial level with the United Kingdom on July 21st, with Ireland on September 21st and with Denmark and Norway on September 22nd.
The primary purpose of the White Paper is to set out, for the information of both Houses of the Oireachtas and the general public, what membership of the Communities will involve for the country as a whole and for particular sectors of the economy. In doing so we aimed to be objective, to cover the full range of implications, constitutional and political as well as economic and social, and to give as complete an assessment as possible, given the many uncertainties and imponderables involved. I think it has been accepted generally that the White Paper is an objective document.
Some people may think, however, that the White Paper should contain more detailed quantifications and more sophisticated analyses of the implications of membership for the economic sectors. I need not go into these at length here since they will be dealt with by the Ministers concerned in the course of the debate. I should like to emphasise that it is the long-run consequences of membership which are the more relevant factors on which to base any judgment about the merits or demerits of EEC membership. Detailed statistical estimates, on the other hand tend to relate primarily to the immediate impact and the short run transitional effects of entry. While such adjustment problems are undoubtedly of importance in their own right it would, to my mind, be wrong that they should dominate any discussion on the overall question. Numerous studies and estimates will, of course, be prepared and used in the course of the negotiations on entry but it did not seem appropriate that these should be extensively quoted in the White Paper itself. The reasons for this are given in paragraph 6 of the introduction, but as these seem to have been overlooked by many commentators I may summarise them briefly here. They are:
(i) the necessity to avoid prejudicing our negotiating position on particular issues.
(ii) The fact that the assessment depends, in the more important instances, on the outcome of the accession negotiations, including the transitional arrangements that may be arranged.
(iii) The fact that in the case of industry and agriculture the consequences will be determined not only by the terms of accession but also by the response of individual firms and producers to the opportunities which our entry to the Communities will create for them, and
(iv) The consideration that the Community will continue to evolve and decisions taken by the present member states before the negotiations are completed could modify the implications of membership in particular areas. Where necessary the assumption by new members of obligations arising from such decisions will, of course, be included in negotiations relating to transitional arrangements.
Turning now to the body of the White Paper, I propose to comment on some of the implications given. On the questions of constitutional and legal implications, the Government accept the view of the Attorney General's Committee that an amendment of the Constitution would be necessary to enable the State to undertake obligations which membership will entail. Membership will, of course, involve for us acceptance of the Treaties of Rome and Paris and the legislation of the Communities in the form of regulations and decisions in the implementation of the treaties, and the purpose of the amendment will be to ensure that this can be done in conformity with the Constitution.
It is important that it should be clearly understood that the provisions of the treaties themselves and the implementing legislation are concerned solely with economic and commercial activities and related social matters. A few commentators have talked of our scrapping the Constitution and replacing it by the Treaty of Rome. There is no basis whatsoever for such far-fetched ideas.
In the final analysis of course it is the Irish people who will decide whether the Constitution will be amended and commitment to membership of the EEC on our part necessarily involves commitment to convincing the public that an amendment of the Constitution is desirable.
Some concern exists as to the effects which membership of the EEC in its present form and as it may in future evolve may have on our national sovereignty. Since our sovereignty was won so recently and at such great cost it is only proper that any issues affecting it should be fully examined and debated here. Membership of the Communities involves only a limited transfer of sovereignty. As I have said, the Treaties of Rome and Paris deal with economic and commercial activities and related social matters.
By acceding to the treaties we will accept obligations in these fields, some of which are set out in the treaties and others are set out in the regulations and decisions issued by the Council and Commission under the treaty provisions. We will, for example, undertake commitments relating to the free movement of goods, the implementation of the common agricultural policy and the abolition of restrictions on the movement of persons and capital and on the supply of services. By assuming these obligations we undertake not to act contrary to them but such a partial surrender of our freedom of action is inherent in our becoming a party to any international agreement.
In so far as trade is concerned our obligations under the General Agreement on Tariffs and Trade, known as the GATT, and the Anglo-Irish Free Trade Area Agreement, are not dissimilar to those we will assume as a member of the Communities. It should be recognised that EEC membership will lead to a greater degree of coordination and interdependence of economic policies among the members than would be entailed under a simple trade agreement. The machinery exists and is gradually being put in motion for the harmonisation of tax systems, economic and monetary arrangements. The White Paper refers to the fact that a value-added tax would need to be introduced here since the existing member countries of the Communities have already agreed on the measure for harmonisation in this sphere. The actual rate at which this tax would be levied and the consequential changes in the components of our tax structure are matters which remain to be discussed.
At first glance it might seem that such a requirement to harmonise fiscal, monetary and economic policies generally over a wide sphere must entail a substantial curb on the exercise of our sovereignty. The reality for any small nation is that the environment within which it conducts its economic affairs can be substantially influenced by the actions of the larger nations and trading blocs. Membership of the Communities, far from diminishing our situation, could result in our having a greater influence and scope for the exercise of economic policies because as a member we would participate in the formulation of common codes of action by member states.
This in turn raises the question of the manner in which decision-making takes place in the EEC. It is possible that uneasiness regarding our sovereignty stems from the fear that Community decisions will be taken without proper regard to Irish interests and that we will have little or no effective say in the making of these decisions. The process of decision-making in the Community takes full account of the interests of member states. Most decisions of importance are taken by the Council—that is the Council of Ministers—on proposals by the Commission. It seems likely that the Commission of the enlarged Communities will consist of 14 members, two nationals from each of the four larger countries and one national from each of the smaller countries. We shall be anxious to ensure that there will be a permanent place for an Irish national on the enlarged Commission. While an Irish Commissioner would be completely independent—like the other Commissioners—in the performance of his function and would act in the general interests of the Communities he would naturally be alive to any problems that proposals under consideration by the Commission might create for Ireland, if they were adopted.
The formulation of proposals by the Commission is preceded by detailed discussion with experts of the member states. In the case of all major proposals discussion takes places in the Economic and Social Committee and the European Parliament, in both of which Ireland would be represented, before decisions are taken by the Council of Ministers.
We would have full participation in the consideration of proposals by the Council through membership of the Committee of Permanent Representatives, which prepares the Council's work, and membership of the special committees and expert groups which assist the Committee of Permanent Representatives. In all these bodies the Irish Government will have a voice and the capacity to influence decisions. The member of the Irish Government sitting in the Council would participate fully in the process of decision-making. The practice in the Council has been to seek decisions which are acceptable to all the member states and which allow for each member's interests as well as those of the Community.
It will be clear from what I have said that accession to the Treaties of Rome and Paris will involve some pooling of sovereignty with the other member states and that in all important respects we will participate, as a full partner with the other member states, in the formulation of and in decisions on proposals on matters with which the Treaties are concerned.
In my earlier remarks I distinguished between the Communities as they exist and as they may evolve towards political unification. This process of evolution is clearly envisaged in the opening words of the preamble to the EEC Treaty which records the determination of the signatory states and I quote, "to establish the foundations of an ever closer union among the European peoples." This closer union is something to which the peoples of Europe including our own must surely aspire but as yet progress towards the attainment of this goal has been limited. It is not possible at this stage to indicate what form it will take or when it will be achieved. The form of political unification to be agreed upon eventually may necessitate the adoption of a new Treaty to stand alongside the Treaties of Rome and Paris. All member states, including Ireland, would participate in the negotiation of such a Treaty. Ireland would be in a position to play a full part in shaping the future political evolution of the Communities. We recognise that this may involve in time some commitment to assist, if necessary, in the defence of the Community but it is too soon to say what form any such commitment would take.
In the discussion on the question of Ireland's membership of the European Communities some mention has been made of the possible cultural implications of such membership. It is to be expected that membership would have some cultural consequences but the extent and direction of these effects is not a matter on which there is likely to be a unity of view. For my part I can see no reason why such effects need be anything but good. Culture is a living thing which is enriched and revitalised by successive generations. The ease of communication and movement in recent times has meant a heightened degree of cross fertilisation between peoples which will influence our way of life whether we are inside or outside the EEC.
For some centuries past the outside influences have come mainly from one source. The wider range of stimuli which would result from closer relations with continental Europe would correct any such imbalance and be of potential beneficial influence. Our culture has flourished in the past when there was active two-way interchange between our centres and those of western Europe. While the contemporary world has changed dramatically since these earlier periods there is no reason why we should not confidently expect that all that is good and valuable in our culture will flourish in the enriched climate provided by membership of a wider Community.
In the chapters dealing with economic aspects of membership, the White Paper attempts to set out the principal obligations which membership will involve for us and to assess their implications as fully as possible. I would again emphasise that a distinction should be drawn between the long-term results and the changes that will be required during the transitional period from the date of accession to the stage at which full harmonisation with the Communities' policies is attained. It is possible that this transitional period may be comparatively short in duration. Variations in the length of the transitional period would affect the rate at which adjustments would proceed in the different sectors of the economy and hence would influence any detailed assessments of the likely consequences of membership.
In addition to seeking the most suitable period for the transitional phase we shall be concerned to explore how the adjustments in tariffs and alterations in relevant trading rules can proceed in the most suitable manner. The Departments and the other agencies concerned are examining these issues.
The conclusion reached in regard to industry is that it is reasonable to expect that the gains from membership would be progressive and, in the longer-term, should significantly outweigh any losses that might occur. The problems of adjustment to the enlarged market would chiefly arise in the earlier years of membership but it should be possible, nevertheless, to maintain in these years an industrial growth rate of the order projected in the Third Programme.
Irish industry would come under increased competitive pressure but, to a large extent, this will occur in any event as the Free Trade Area Agreement is implemented. The additional competition which would result from our membership of the Communities should be more than offset by increased opportunities for existing firms through access to wider export markets and by the establishment of new industries to serve the enlarged Community market. Higher farm incomes would also provide a considerable stimulus for the home market. Therefore, we consider that the balance of advantages in the industrial sector favours membership.
The advantages of membership for Irish agriculture are fairly clear. The Irish farmer would receive substantially higher prices for most of his agricultural produce, prices that would apply whether the produce was disposed of on the home market, on the market of the enlarged Community or was exported to third countries. The White Paper summarises the position for our principal products. While it is difficult to forecast with any precision the overall effects of membership on our agricultural production, it is estimated tentatively that the volume of gross agricultural output might be expected to increase by 30 to 40 per cent by the end of the decade. I have already referred to the beneficial effects which the increased farm incomes would have on the demand for the products of Irish industry. We must also bear in mind the influence which the increase in the volume and value of our agricultural exports would have on our balance of payments.
In assessing the overall economic implications of membership, the White Paper states that in the light of the growing strength of the economy and given equitable transitional terms, it is reasonable to conclude that membership would give a strong impetus to production and exports from the agricultural and industrial point of view and hence to the growth of the economy. The opportunities for maintaining a satisfactory rate of economic growth would be greatly reduced if we remained outside an enlarged Community which included Britain.
In my statement to Dáil Éireann in July, 1967, on the reactivating of our application for membership, I adverted to a suggestion that our relationship with the enlarged Community should take the form of association rather than membership and pointed out the shortcomings of this kind of link as compared with membership. As the question may be raised again, I think I should take this opportunity of restating the Government's views on the matter.
The Community's attitude is that a European country should not be granted associate status in place of membership unless it is economically undeveloped or is unable because of its international relations to become a full member. Neither of these obstacles applies in our case. The Commission in its Opinion of October, 1969, on enlargement refers to the applicant countries, including Ireland, as having achieved a level of development comparable with that of the six member States. There are no political obstacles to our acceptance of the obligations of full membership.
If we were, nevertheless, to seek associate status the question must be asked what form of association would be of value to us assuming, of course, that the Community would be prepared to give us such status and bearing in mind that the United Kingdom would be a member of the enlarged EEC? A trading arrangement would not be of any real value: under the GATT any tariff or trading concession given us under such an arrangement would have to be extended by the enlarged Community to all GATT countries and, therefore, the content of any such arrangement would be very meagre. Almost all of our exports would remain subject to the common customs tariff on import into the enlarged Community including the United Kingdom, as well as to the levy restrictions applied to agricultural imports under the common agricultural policy. These levies have had disastrous effects on our agricultural export trade with the Six. What would be the effect on this country's economy if the same were to happen to our agricultural trade with Britain?
A preferential trading arrangement would be contrary to the provisions of the GATT unless it took the form of a free trade area or customs union. It is clear, therefore, that an association agreement of any worthwhile scope would have to take the form of a free trade area or customs union. The Community has always been opposed in principle to entering into a free trade area arrangement with European countries and would probably insist on any such association agreement taking the form of a customs union which, under the terms of the GATT, would have to apply to substantially all the trade between this country and the enlarged Community. In addition, it must be expected that an association agreement would incorporate rules of competition analogous to those in the EEC treaty. So far, therefore, as industrial trade is concerned, our obligations and rights under an association agreement would be very similar to those under the EEC treaty.
The principal difficulties would arise in regard to the agricultural sector. All the indications the Government have received point to the conclusion that an associate country would be unlikely to be accorded anything approaching full participation in the enlarged Community's common agricultural policy. The agricultural concessions which we would be likely to obtain would be relatively minor and we would have no say in the formulation of the Community's agricultural policy as it would affect us. Our agricultural exports to the British market would be in jeopardy and we would have little hope of expanding exports to the Continent. Therefore, the Government's view is that an association agreement would not afford us a favourable balance of economic advantages and that only full membership of the enlarged Community would provide an environment favourable to the continuing expansion of our economy.
I cannot emphasise too much that, as an associate member, Ireland would have no voice or vote in the decision-making process of the Community and many Community decisions could certainly have a significant effect on our position as an associate. Apart from purely economic considerations, we would be cut off from full participation in the future evolution of the European Communities, participation which will only be possible for us through membership.
The Government hope that the White Paper will encourage discussion of the important issues that arise in relation to our accession and will stimulate the various economic and other interests to prepare in good time for the changes which membership will entail. The question of membership has been before us now for close on a decade and the false starts that have occurred may have caused some people to think that our accession will never take place. The present situation is very different from that in the 1961-63 period and in 1967. All the member states have expressed their commitment to the enlargement of the Community and we must plan, therefore, on the basis that negotiations will succeed. Accession may take effect within a few years. It will be the most momentous step taken by the Irish people since the foundation of the State.