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Dáil Éireann díospóireacht -
Wednesday, 28 Apr 1982

Vol. 333 No. 8

European Council Meeting: Statement by Taoiseach.

With the permission of the Ceann Comhairle. I will make a statement on the meeting of the European Council which I attended, together with the Minister for Foreign Affairs, in Brussels on 29-30 March. As I indicated before the Easter recess, I regret that the pressures of business prevented me from reporting to the House, as I would normally wish to do, as soon as possible after the meeting.

Deputies will recall that the dates of the meeting were close to the 25th anniversary of the signing of the Treaty of Rome. This silver jubilee was marked by a ceremony to commemorate that historic event. This took the form of an academic session, for which the members of the European Council were joined by the members of the other institutions of the Community, as well as by persons who formerly held office in the Community, or who otherwise made a signal contribution to its development.

The commemoration was marked by satisfaction with what has been achieved, tempered by preoccupation with current difficulties in the Community and a keen awareness of how much has yet to be accomplished in pursuit of the Treaty's declared objective of "an ever closer union among the peoples of Europe". I avail of this occasion to reiterate our commitment to that goal, at once noble in itself and essential for the welfare of the European peoples, in a world where peace seems increasingly fragile.

In his address at the academic session, the President of the Council, Mr. Leo Tindemans, mentioned how far the European citizen takes for granted the advantages of the Community's existence. He also underlined how the choice of economic integration as an objective necessarily led to the position where Europe, as perceived by our citizens, is a complex of technical and often confusing elements. These considerations led Mr. Tindemans to stress again the importance of giving the Community a human face and of helping individual Europeans to gain a greater knowledge and appreciation of the priceless heritage we share. An important part in this vital task will be played by the new European Foundation, which we formally agreed to establish at the jubilee celebration. The foundation will promote mutual understanding and will give form to European solidarity, in particular by stimulating the exchange of ideas, fostering contacts across frontiers among individuals and schemes for the exchange of young people and scientists, as well as a whole range of cultural activities. The seat of the foundation will be Paris and its programme and modes of action will be further elaborated over the coming months.

I now turn to the meeting of the European Council itself. We had an intensive discussion of the economic and social situation in the Community and in the world, including trading and economic relations between the Community, on the one hand, and the United States, Japan, Eastern Europe and the developing countries. We heard an explanatory statement from the Greek Prime Minister. Mr. Papandreou, about the memorandum his Government has circulated on the position of Greece within the Community and a progress report from Mr. Tindemans, the President of the Council of Ministers, on the mission entrusted to him and Commission President Thorn by the last meeting of the European Council in relation to the Mandate of 30 May 1980. In the sphere of European Political Co-operation, the discussions ranged over Europe-US relations. East-West relations, including events in Poland, and the Madrid meeting to review the operation of the Helsinki Final Act, Afghanistan, the Middle East, Central America and Turkey.

My primary objective, in approaching the meeting, was to ensure that it led to the initiation, at both national and Community level, of a co-ordinated programme of specific measures to deal with unemployment. As we met, the number out of work in Europe was expected to increase for the ninth successive year. By the middle of this year, their number will reach 11 million with a strong possibility that, in the absence of worthwhile action, this could reach 12 million by the end of the year. The average percentage rate for the year as a whole may be about 9 per cent, with rates for Ireland and the UK of over 11 per cent and a rate in excess of 13 per cent for Belgium. In Ireland, we are regrettably no strangers to rather high rates of unemployment but the rates now prevalent in other member states reflect very substantial year-on-year increases in the numbers without work — by 49 per cent in the Federal Republic of Germany, 42 per cent in the Netherlands and 24 per cent in the UK and Belgium up to February last compared with 15 per cent in this country over the same period.

This situation is a result of the depth and duration of the recession which has affected all our economies in recent years. Last year, there was a decline of 0.5 per cent in Community GDP. For 1982 the commission had forecast a slight upturn, an increase of 1.6 per cent but this is precarious and highly dependent on international developments affecting interest rates, exchange rates and world trade.

Looking further ahead, a major source of disquiet is the low level of investment in the Community. Our own high rate of around 30 per cent of GNP is exceptional and the Community average is less than 20 per cent. Failure to raise the low rate of capital formation will condemn Europe to economic decline.

Concern on the counts to which I have referred was registered in the paper submitted to the meeting by the Commission which also suggested certain guidelines for a Community response. I am happy to say that the general thrust of these proposals was along lines which we could support.

At the meeting itself, I reiterated my concern that concerted practical measures be instituted in order to tackle the critical situation we face, with due regard for the correction or avoidance of insupportable imbalances. I described how the policies being pursued by the Government are contributing to achievement of these objectives in Ireland's case, through adoption of a budget which cut sharply the current budget deficit; through the implementation of necessary taxation in a manner which minimised price increases; through the establishment of moderate patterns of wage settlement; and through the maintenance of a high rate of publicity supported investment.

I supported the Commission view that higher investment is the key to increases in employment and that new incentives to invest must be introduced. Referring to the high cost of funds for investment at present. I called for Community action to reduce these costs and suggested, inter alia, that the proposed increases in the capacity of the Community's credit instruments should be complemented by greater provision for interest subsidies, in the case of loans extended for investments in the less prosperous parts of the Community. I also proposed that in their application to these regions, the credit instruments should make loans available for social capital, pointing out that in many cases the urban structures in these regions require renewal and rehabilitation if they are to play an effective role as centres of economic and social development. I also stressed the need for Community action to increase the pace of technological change and innovation in the Community.

In relation to employment and unemployment. I expressed the view that future reports on the economic and social situation in the Community should include analysis of developments in the agricultural sector, having regard to the fact that in some member states the progress or otherwise of agriculture can have significant effects on the level of unemployment and to the pre-eminent position of the CAP in the array of Community policies. While welcoming moves to enlarge the scope and capacity of the European Social Fund, I emphasised that this cannot be done at the expense of the priority now given to the less prosperous regions in the administration of the fund's resources. I proposed that the Commission be asked to prepare further proposals on specific action to deal with unemployment, based on an examination of all the practical suggestions advanced at the Council meeting. Finally, I pointed out that new action, on a worthwhile scale, cannot be taken within the financial restriction imposed by the existing limitation on Community own resources. Additional resources are required and the need to modify the 1 per cent VAT limit must be faced.

At successive meetings of the European Council I have pressed these views and while progress was made on some individual issues on those occasions, my predominant feeling was one of disappointment at the apparent lack of will to act with decision and vigour at a Community level. I am happy to say that reactions in Brussels and the conclusions of last month's meeting which I have had laid before the House some time ago represented a welcome contrast. While there were certainly differences of emphasis on some issues, I found that my approach was widely shared and I was satisfied that with proper follow-up the outcome would lead to a concerted attack on the economic problems that beset us all.

I turn now to the areas of international economic policy and the Community's economic and trading relations with the United States, Japan and the developing countries. The European Council met against the background of some strains in trading relations between the Community and the United States and of concern about the effects on the European economies of very high interest rates in the United States, with their significant influence on rates in Europe. The continued widening of the trade gap between the Community and Japan has lent urgency to the efforts to put trade relations on a more balanced and harmonious basis. More recently, concern has extended to Japanese macro-economic and exchange rate policies. The Community has also been anxious about the persistent failure to make progress in the North-South dialogue between the developing countries and the industrialised world. All of the matters I have mentioned will come up for discussion at the Summit meeting of industrialised countries in Versailles in June and the Brussels meeting afforded an opportunity for the Heads of State or Government of the Community countries to have a useful exchange of views in preparation for the Versailles meeting. Preparation of the Community approach is continuing in the General Affairs and Ecofin Councils.

Ireland's position, as a small economy heavily dependent on trade, gives us a major interest in defence of the open multilateral trading system and in resistance to moves towards protectionism. The concept of reciprocity in trade must be interpreted in a broad global manner and not in a narrow bilateral and sectoral way. As I indicated in my speech last month to the Economic Club of New York, the Community and the United States need to discuss and resolve, as friends, whatever difficulties we may have in the various international fora which have in general served us well in the post-war period. In any such discussions the Community must show itself to be united and the need for such an approach at Versailles should be manifest in a strong and united defence of the Community's right to a fair share of the world market in agricultural produce. Unity is also strength in economic dealings with Japan and has led to an encouraging start in the opening up of Japanese markets, a trend which the Community must seek to reinforce.

Because the issue had been remitted to a special meeting of the Foreign Affairs Council which it had been intended to hold shortly after our meeting, we did not discuss the issues arising in connection with the mandate of 30 May 1980 in any detail. We heard a brief progress report from the President of the Council, Mr. Tindemans, following completion of an exploratory mission undertaken by him and President Thorn. As noted in the Presidency's conclusions, the European Council asked the Council to do all in its power to enable decisions to be taken as soon as possible.

As Deputies will be aware, the meeting fixed for 3 April did not take place because of the Falkland Islands situation. The subject was taken up again at the meeting in Brussels yesterday.

I can tell the House that progress was made at that meeting. For the first time figures are on the table. Nine delegations agreed on a figure for 1982 which should underlie an appropriate rebate agreement for Britain. This figure was not regarded as adequate by the British side. They have been asked to reflect on the situation and Foreign Ministers will meet again within ten days. Ireland, along with eight other delegations, expressed the strong views that no link should be made between the farm price negotiations and the mandate. The British Foreign and Commonwealth Secretary, Mr. Pym, agreed to report this view to his Government and to indicate their response today.

At one stage there were suggestions that the Agriculture Council commencing today might be postponed. These were of considerable concern to us and strong pressure by the Minister for Foreign Affairs ensured that the Agriculture Ministers are in fact meeting to day and that negotiations are continuing on the prices package. I understand that in the response promised yesterday the British are talking about the need for paralles.

I wish to say that the Government here would regard it as a very serious development if there were to be further delays in fixing farm prices, especially if these arose from a link with the question of budgetary rebates for Britain. This would in fact run directly counter to one element in the agreement which provided for the original budgetary settlement for the UK, under which that country was a net beneficiary from the Community budget in 1981.

As Deputies will recall, in the conclusions of the Foreign Affairs Council on 30 May 1980 all member states undertook, particularly during the period when the mandate review for 1982 is under way, to do their best to ensure that Community decisions are taken expenditiously. We would like to see that undertaking honoured in the letter and in the spirit. Community solidarity is indivisible and must apply, in particular, in the annual arrangements under the Community's principal operational policy — the Common Agricultural Policy.

As is usual at meetings of the European Council, the heads of state and Government also considered a number of important issues in the framework of political co-operation.

All of the Community member states have close and extensive links with the United States and it is right that at a time when the industrial democracies face serious international economic and political problems, the European Council should stress its desire to strengthen these links and to develop consultative arrangements. The Council expressed its appreciation of President Regan's friendly remarks on the development of European unity made on the occasion of the 25th anniversary of the Treaties of Rome.

On Afghanistan the Council reiterated its position expressed at earlier meetings and called for a political solution that would entail complete withdrawal of Soviet troops and respect for the independence, sovereignty and non-aligned status of Afghanistan.

Developments in the Middle East were also considered by the European Council. The Heads of State or Government called for an end to the unilateral measures taken by Israel such as the dismissal of the democratically elected West Bank mayors and appealed for an end to violence and repression in the occupied territories of the West Bank and Gaza. They also urged the parties to respect fully the sovereignty and territorial integrity of Lebanon where dangerous clashes have occurred recently. The Council reaffirmed the wish of the Ten, as expressed on previous occasions, to contribute to the establishment of a just and lasting peace in the Middle East.

The situation in Central America was also discussed by the European Council. As Deputies are aware, the Dáil has expressed the deep concern felt by many Irish people at the continuing tragedy in El Salvador and at the grave violations of human rights there. The problems which affect El Salvador in so far as they are rooted in the gross social and economic inequities and under-development, are also present in other countries of Central America.

For this reason, I welcome the attention given by the European Council to the conflict in Central America and in particular its desire to see an end to violence and the restoration of peace through dialogue and respect for democracy and human rights. A number of important initiatives have been put forward to help reduce the appalling social and economic difficulties in the region and I am glad that the Community member states intend to intensify their own economic assistance to the region.

The Belgian Foreign Minister and current President of the Council, Mr. Tindemans, reported on his recent visit to Ankara where he spoke with the Turkish authorities on their timetable to restore democratic conditions and on the problem of human rights in Turkey. The Council trusted that Mr. Tindeman's visit would bring about the improvements desired by the Ten.

In the margins of the meeting, I had a short informal discussion with the British Prime Minister. It is not customary to disclose details of conversations of this nature but I can inform the House that we had an exchange of views on a number of matters of mutual concern. It was arranged that the Minister for Foreign Affairs would meet the Secretary of State for Northern Ireland in London on the following day for a full briefing and exchange of views on the proposals of Mr. Prior which have since been released.

The meeting of the European Council in Brussels was moderately satisfactory. It afforded an opportunity for a valuable exchange at head of state or government level on a range of important political issues at a time of considerable international difficulty. In the economic sphere it marked the beginning of a process which, if followed through vigorously, could put the economic weight of the Community behind a programme of economic recovery. The House may be assured that the Government will do all in their power to see that process carried forward for the benefit of our own people and of all the people of Europe.

I had the pleasure of attending the academic session of the European Council to which the Taoiseach referred. I do not think that his summing up of the themes at that academic session does justice to the degree of concern expressed in speeches made there at the failure of the Community to make the progress necessary to be effective in tackling the problems facing the Community.

Later on in his remarks, the Taoiseach said that the predominant feeling has been disappointment at the apparent lack of will to act with decision and vigour at Community level. When he was reporting on those sessions, the Taoiseach did not express his disappointment. He tended to think of them as something that had happened. On this occasion he told us that this session was different, that it was better. I cannot say that I share his confidence that the reaction in Brussels at the conclusion of the last meeting represents a welcome contrast to the failure of earlier Council meetings to make practical progress.

In this connection a problem exists to which the Taoiseach made reference, that of decision making. He recalled that in May 1980 all member states undertook, when the mandate review for 1982 was under way, to do their best to ensure that Community decisions would be taken expeditiously. Such good resolutions have been made in the past. One such was made at the Paris Summit, which decided on the inauguration of the series of European Council meetings. At that Paris Summit it was decided that decision making procedure should be improved and that this should be done by making greater use of the qualified majority voting procedure. In the months that followed that we were in the Chair and we inaugurated that progress. Before the end of our six months in office we succeeded in reaching a point when qualified voting procedure was taking place on issues which did not involve the vital interests of member states.

After our Presidency that was allowed to fall into disrepair. I heard in the Brussels corridors when the Taoiseach was there at the academic meeting that during the Belgian Presidency there were suggestions that the procedures which I had introduced in regard to using qualified majority voting in cases when vital interests were not involved would be reinitiated. It does not seem to me that this has happened. I regret it and I hope that the Taoiseach and the Government will encourage a further look to be taken at the decision making procedure. Nobody could be more aware than we in Ireland during the past few months, when the common agriculture policy was under threat, that when vital national interests were at stake the Community had not reached the point at which a country like us could wisely give up our rights and insist that unanimity is necessary; that what has held up progress in the Community has not been the use of the so-called veto in cases when there is a vital national interest involved, but the abuse of it in case when it quite evidently is not. It is to such problems that I hope the Government will direct their attention.

From our point of view the most significant feature of the European Council is that the mandate issue will be left over to the Foreign Ministers. Pressure on the CAP was reduced since the previous European Council, and the centre of attention has been shifted over to the British budget. The National Coalition Government's resistance to the erosion of the CAP has been an important factor in this. Our resistance was maintained at a time when the resistance of some other countries with an interest in the CAP had been relaxed. We appeared then to have been somewhat isolated. The energetic diplomatic efforts of our Government then, even during an election campaign, helped to stave off that danger and, as a result, when this Government took over they found themselves in a happier position because the pressure on the CAP had eased and the centre of attention had been diverted to the British Budget, as the Taoiseach has told us.

There was a marked contrast between the dramatic campaign we waged — which had some useful results as we have seen — and the subsequent neglect by the new Government of the Community institutions which could have been fatal but for the success of the earlier dedicated and skilful work of Senator Dooge and Deputy Dukes.

But the Government, now that they have begun to take the Community mechanisms seriously again, must keep up the pressure to ensure that the attack on the common agricultural policy does not resume and that the solution to the British budget question, whatever that may be, does not weaken or endanger the solidarity of the Community by introducing a juste retour principle.

The correct and wise attitude of the Government in supporting Britain in the Security Council and the EEC in the face of Argentine aggression has helped to convey to British opinion, hitherto even after almost ten years in the Community insensitive to the whole idea of Community solidarity, the value of being a partner in such an enterprise. This should help to soften some of the British attitudes which have hitherto been based on the narrow concept of getting back as much as they put in financially, without even taking account of the remarkable opportunities for the expansion of exports which free trade with 200 million Europeans has provided to the United Kingdom. It is to be hoped that this new British perception, evident even in the popular press in Britain, will translate itself into concrete reactions in terms of a more reasonable approach to the budget issue and in particular to recognition of the importance of the CAP as a binding force in the Community.

The Community's role is not confined to solidarity with a country whose territory has been the victim of aggression; it is also the duty of other members of the Community to help a partner to react flexibly, intelligently and in a mature way to such a situation, showing openess to negotiation on the real issue of sovereignty that has been temporarily obscured by Argentine aggression.

In the past the Community has played a significant role of this kind—for example, in relation to Britain in the case of Zimbabwe. For quite a period in the late seventies British Governments were under pressure from inadequately informed domestic opinion to negotiate a so-called internal settlement in Zimbabwe which would have led to an indefinite continuation of the war and a danger of Soviet involvement in Southern Africa. EEC support for negotiations with the Patriotic Front helped sustain successive British Foreign Secretaries in relation to their own domestic opinion and in relation to pressure within their Governments. Ireland, under successive Irish Governments, played a constructive part in this process. This was privately acknowledged to me subsequently by a senior British Minister who had had responsibility in the matter.

At this point we have a similar opportunity with others in the Community, such as our close friends the Netherlands who view so many foreign policy issues in similar light to us, to help Britian to show flexibility and moderation from its present position of military strength. I urge the Government to pursue through private diplomacy this opportunity to contribute to a peaceful settlement from the position of goodwill which we have earned through our unambiguous condemnation of the initial act of aggression.

Coming nearer home, we must be concerned with our own exposed economic situation in the Community. The financial situation which the National Coalition found in the middle of last year alarmed not only us but the Commission also. That body was reassured by the action we took in July and by our firm determination to pursue this policy with a view to bringing the real level of borrowing down to around 13 or 14 per cent of GNP and the current deficit down to or below 6 per cent of GNP in 1982, even though the latter target involved the tough task of virtually halving the threatened current budget deficit. Failure by the present Government to maintain this policy and the initial shift in the policy involving an increase of about £170 million, almost 1½ per cent of GNP in the real level of the current deficit and borrowing, has alarmed the European Commission and other observers abroad as was evident to me in discussions I had on the occasion to which I have already referred in Brussels. A further drift of over £50 million since the budget must have added to this disquiet.

The Community's position is clear from the reference in the statement which the Taoiseach circulated after the meeting to the importance of the lowering of interest rates. But the Government by their policies, and even the threat of their coming to power before the actuality, raised interest rates by 1½ to 2 per cent through a diversion of borrowing from abroad to an already tight domestic credit market, caused by a fear of devaluation aroused by the soft option approach of the Government. Industry is now paying dearly for the advent to power of Fianna Fáil, both in having to borrow its share of the £170 million extra to be found by business this year to finance Government spending and in paying 1½ to 2 per cent more for this and other borrowings. The effect of this on unemployment will be evident in the months ahead. Instead of levelling off and after some months falling, as our policy was designed to achieve, there is now a prospect of a further sharp rise in unemployment due to redundancies caused directly by the Government's policies.

The Government must heed the Community's view on this issue, a view to which they have nominally subscribed in this statement. They must take the steps necessary to reduce the fear of devaluation and the consequent excess pressure on the tight domestic credit market which has pushed up interest rates and held them at unnecessarily high levels.

One feature of the European Council meeting which was encouraging was the recognition of the value of a youth employment policy of the kind pursued by our Government. A commitment to strive to ensure that all young people over the next five years entering the labour market for the first time will receive vocational training or initial work experience is closely aligned with the youth employment policy of our Government, an area neglected by Fianna Fáil up to last year but even this Government will scarcely dare to overturn our constructive achievement in this respect, although the Taoiseach's failure to say much about this in his statement is a bit discouraging. One is forced to wonder whether his reluctance to comment on this aspect of the statement may not have arisen from the extent to which the Community's policy which here is so closely aligned with the policy which we initiated during our eight months in office.

Nevertheless, we cannot be too sanguine about the results of this European Council. While less threatening to our interests than it had seemed it might be, there are no really firm, constructive decisions likely to change the direction of European policies on a scale that would affect us significantly. The Taoiseach is mistaken in trying to suggest to the contrary. These meetings, as the Taoiseach now admits he previously found, tend to involve a lot of talk but little action, and they rarely have the atmosphere of mutual support which can be generated in the Foreign Ministers Council, which is of course a genuine organ of Community and not, like the European Council, an accretion to the European system.

On other foreign policy issues, our position on a number of matters— Poland, Afghanistan, the West Bank in Palestine and Central America — is aligned to that of the Community generally, though we have been ahead of others in our practical concern and constructive approach to some of these problems. On issues of this kind we are able to make a more effective and constructive contribution through the Community than in isolation in seeking to lead opinion within the Community, which we have successfully done with other like-minded countries in the Community. So long as the Government do not allow our position with respect to military alliances to be eroded — as threatened to happen as a result of the Venlo meeting attending by the present Minister for Agriculture, then Minister for Foreign Affairs, earlier last year — the Government should not be afraid to pursue an active foreign policy based on a principled approach to world problems that will command respect inside and outside the Community.

I have noted comments recently in the press and from different sources which seem to suggest that neutrality involves not non-participation in military alliances but actually cutting oneself off from playing any role or taking up any moral position on any world issue. This point of view is totally out of line with the tradition of neutrality which we have established even before neutrality became an issue in the last war. The kind of position taken up by the late Mr. de Valera as President of the Executive Council in regard to issues in the League of Nations in the thirties, including Abyssinia at that time, was one which did not involve pussy-footing in regard to the issues but taking up a strong moral position in the face of aggression.

It is right that this Government should continue to do this and I am glad the Government have done so. I regret that there were press reports which suggested that the Taoiseach was not in accord with the policy and that in some way it had derived from within the machinery of Government. The Minister for Foreign Affairs subsequently made it clear that these reports were not true. It is right that we have taken up the clear position we have and from that position of moral authority we should endeavour to give a lead to ensure that what is happening in regard to the Argentina crisis and to other world crises does not lead to greater conflict, war or violence. We have some moral influence in the UN and the EEC and this should be used to good effect as has been the tradition of our Governments to do and as has been done over the last couple of weeks.

The communiqué issued after the Brussels European Council Summit meeting was to say the least of it disappointing. Given the magnitude of the unemployment problem and the fundamental disagreements which have emerged on the Community budget, the results are indeed meagre.

The meetings of the Heads of Governments of the European Community are rightly or wrongly expected by the general public to produce decisions on the problems common to member states. As the European Council itself is not a formal decision-making body, it is all the more essential that it should issue clear guidelines for follow-up action at the level of the Council of Ministers and at national government level. It may well be that this is to expect too much from such meetings. If this is the case, their relevance needs to be seriously looked at.

When the entire European Community is experiencing low or negligible rates of economic growth and record unemployment, failure to resolve outstanding disputes and give a fresh impetus to tackling these problems represents a setback.

The preamble to the conclusions of the Presidency recognises the seriousness of the world economic crisis and that all member states have the same interest in combating unemployment and restoring economic growth. No one can quarrel with that statement.

With commendable realism it acknowledges that the slight recovery in the European economy this year will not be sufficient to arrest the growth of unemployment. However, the diagnosis is not matched to any extent by the proposed remedies. That is my chief criticism; the diagnosis correct, the remedies inadequate.

Apart from the commitment to take vocational training and work experience measures at national level to combat youth unemployment, no substantive proposals can be detected to tackle unemployment, which the communiqué acknowledges will continue to rise.

In fairness to the Taoiseach, he is reported to have sought the expansion of the regional and social funds as well as supporting the extension of the new Community instrument as an appropriate response to unemployment. I have no doubt that such an approach has the support of this House.

The new Community instrument which, according to reports, has been increased to 3 million units of account is welcome, but really only scratches at the surface of what is required. The appeal of Commission Vice-President Ortoli for Community instruments and adequate tax concessions to promote investment appears to have been ignored, as was any expansion of the regional and social funds.

The discussions on the "30th of May Mandate" became bogged down, as predicted, on the question of the British contribution to the budget. In turn this has resulted in the stalemate on the fixing of farm prices which is estimated to have already cost our farmers £7 million.

However, the Taoiseach seems to have got carried away with the public relations aspect of the Summit in indicating that he was pleased with its outcome. It is understandable that a Taoiseach coming from here should appear to be as constructive as possible on the outcome of the Summit. However, to some extent, and the Taoiseach on reflection might agree if he assesses again the achievement of the Summit, his own comments on it were a little too sanguine. There is the very real prospect that with the British Government continuing their intransigent position on the UK budget contribution, agricultural prices will not be fixed until the end of May. I do not understand how the Taoiseach could have expressed himself as pleased with this outcome in that situation.

The Irish Press of 31 March reported that the Taoiseach had secured one of his main objectives, namely that his relationship with the British Prime Minister was to be maintained and developed. Success in this objective can be gauged by the British Prime Minister's specific relegation of the Anglo-Irish Summit meeting to the status of similar bilateral meetings with France and West Germany. Admittedly, it has always remained the British position that our bilateral contacts are on a similar level but it is significant that the British Prime Minister should have referred to it specifically on this occasion and made it quite clear that she considered it as no more than similar meetings between France and West Germany. In addition, considering the context of our relationship with the British Prime Minister, the spring meeting between the British and Irish Governments, which was discussed at the London Summit meeting last year was postponed until July. I do not see how one could, with the best intentions, consider that those results from the Summit meeting point to a deepening of our relationship with the British Prime Minister.

At the end of the meeting the Taoiseach stated that he was pleased the communique contained a specific acknowledgment that unemployment is a Community as well as a national problem and that the Community must adopt a co-ordinated investment policy to deal with it. It is to be easily pleased if one takes acknowledgment of this kind, which has been made at the last two meetings of the European Council, as indicating a real commitment to take Community-based initiatives to boost investment and reduce unemployment. This was the objective at Community level but to confuse these statements with reality is a mistake.

It must be said, with some regret, that the Community is suffering from a paralysis of political will. It must be conceded that the EEC is suffering from a lack of progress and a disease which appears to simply see Summit meetings relegated to the point of analysing what is wrong with Europe but takes no specific measures to deal with it. It is self-defeating to correctly analyse the crises in which the Community finds itself and then fail to take appropriate action.

The development of an integrated investment policy by the Community, that is combining Community-based instruments with national instruments, is what is required if we are to reverse the unemployment spiral. The scale of funds necessary obviously means that the resources of the Community which primarily consist of 1 per cent of VAT revenues must be expanded. Otherwise the boosting of investment is going to remain a mere peripheral item on the agenda of these meetings indefinitely.

In point of fact, the Mandate Report contains specific proposals to encourage investment; but the Council of Ministers has yet to decide on these proposals.

The depressing reality is that West Germany does not believe in a Community-based initiative. While not minimising the beneficial impact of a fall in US interest rates on the European economy, it would appear that the position of West Germany is that each country must look after itself and secondly that external factors such as US interest rates are more important than any Community-backed initiatives. As long as that remains the West German position, it is difficult to see any real movement at Community level or co-ordinated Community instrument to deal with unemployment. I do not know what one could do to alter their attitude but it is regrettable that it obtains because the German economy in the past has been the motor of the Community. If this is their attitude to Community initiatives at present it is depressing for all members, especially smaller members like our country.

If the Community fail to commit the necessary resources this will be the case. I accept that the balance of payments of each country is primarily the responsibility of each national government. However, if member states with stronger economies do not see a role for Community policies to deal with unemployment and to boost investment, then the prospects for the future of the Community are indeed bleak.

With regard to the EMS it appears that all that could be agreed was that the system has worked well over the past three years. Without a commitment towards economic convergence the EMS will be characterised more by realignments of exchange rates that the relative stability of the last three years. Again in this regard Ireland's record on domestic economic management largely renders invalid criticism from the Taoiseach as regards a further development of the EMS.

Turning to international relations, the statement on foreign policy is generally welcome. In particular, the renewed call for the ending of martial law in Poland and the resumption of a genuine dialogue with the Church and Solidarity has all our support.

The Soviet occupation of Afghanistan is rightly condemned. The Community has taken a commendably resolute line from the beginning on the situation in both of these countries.

In summary, it can be only hoped that the next meeting of the Heads of Government is shorter on analysis and longer on commitments. This Community-backed investment must continue in all our economies, otherwise the small or peripheral economies like our own will continue to suffer high unemployment. Unless future Summit meetings produce remedies as well as analyses, citizens in Europe of the various member states will begin to believe that neither the leaders nor the institutions of the Community can offer any European solution, as distinct from purely national initiatives, towards solving the crisis unemployment levels being experienced in member states at present. If that position continues, then the whole ideal of a European Community which tackles economic and social questions will die.

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