Dáil Éireann díospóireacht -
Thursday, 20 Oct 1994

Vol. 446 No. 2

European Communities (Amendment) Bill, 1994: Second Stage.

Minister of State at the Department of Foreign Affairs (Mr. T. Kitt)

I move: "That the Bill be now read a Second Time."

This Bill, amends the European Communities Acts, 1972 to 1993 and enables the Treaty providing for the accession of Austria, Sweden, Finland and Norway to become part of the domestic law of the State. Its passage through the Oireachtas is a necessary part of the process of Ireland's ratification of the Accession Treaty.

As Deputies are aware, enlargement negotiations with four EFTA countries opened in February 1993 for Austria, Sweden and Finland and in April 1993 for Norway. After a relatively short period of little over a year, the negotiations were brought to a successful conclusion on 30 March 1994. On 12 April the European Parliament voted by an over-whelming majority in favour of enlargement. The vote of the European Parliament was, in itself, significant because it was the first occasion that the Parliament had been asked to give its assent to the enlargement process.

The four accession countries decided to hold referenda on whether to join the European Union. The first of these was held in Austria. On 12 June the people of Austria voted by a two to one majority in favour of European Union membership. Last Sunday the people of Finland voted in favour of membership of the European Union by a margin of 57 per cent. Referenda will be held in Sweden on 13 November and in Norway on 28 November. We will await the outcome of these referenda with great interest.

I will outline the approach adopted by the Government to the negotiations leading to the enlargement of the European Union. From the beginning, the Government welcomed the prospect of membership of the European Union by the four negotiating EFTA countries. Significant groundwork had been done in the European Economic Area Agreement negotiations. In addition, Ireland has much in common with all four. We have shared similar interests on a range of international issues. We were confident at the outset of the negotiations that solutions could be found for every issue that arose during the course of negotiations. In this assessment we were correct. The outcome of the negotiations was a good one both for the accession countries and for the European Union. The people of Austria and Finland have decided they wish their respective countries to become members of the European Union. It is now up to the people of Sweden and Norway to decide.

The Government warmly welcomes the decisions of the people of Austria and Finland and looks forward to welcoming these countries to the European Union as full members on 1 January, 1995. We will await the decisions of the people of Sweden and Norway with great interest. We hope we will be in a position to welcome both Sweden and Norway to the European Union. Ireland will have many things in common with these countries in the union as smaller members with particular regional and agricultural interests. With Sweden we share a similar outlook on international issues and with Norway we share many interests as Atlantic neighbours. It is of course for the people of both countries to decide based on their perception of where their interests lie.

The Treaty of Accession was signed in Corfu on 24 June. Following signature it was possible for the Government to introduce the European Communities (Amendment) Bill, 1994, and the Bill was published at the beginning of August.

All member states of the Union and the four accession countries have undertaken to complete ratification procedures by 31 December 1994. The passage of this Bill, together with the passage of a motion in the Dáil approving the Accession Treaty, are the major steps required to enable Ireland to ratify the Treaty of Accession. If all the remaining referenda produce the same result as that in Austria and Finland, the European Union will be in a position to welcome four friends of long standing as members of the union on 1 January next year.

I welcome this opportunity to debate the Bill and to address the substantial and considered report of the Joint Committee on Foreign Affairs on the Enlargement of the European Union published last month. This debate comes at an opportune time. The enlargement of the European Union has dominated the European Union's agenda for well over a year now and is likely to continue to dominate it in the years to come.

It is opportune that at the point where one round of enlargement has been successfully concluded and draft legislation is before this House, the foreign affairs committee has produced a report that seeks to chart a course as to how the enlargement of the European Union should be addressed in Ireland.

I very much welcome the report of the committee. It contains a considered analysis of the issues and a series of thoughtful recommendations. I congratulate the committee on its work. I am sure the report is one of many substantial contributions which the committee will make to debate on foreign and European policy issues — a debate which will be further illuminated when the Government publishes a White Paper on foreign policy in the first half of next year.

In looking at the negotiations with Austria, Sweden, Finland and Norway, it should be remembered that all the conditions favourable to a quick and successful completion of the negotiations with these four EFTA countries were present. In addition, the Union and the EFTA countries had successfully completed negotiation on the European Economic Area Agreement. This agreement came into effect on 1 January 1994. It created a single market for goods, services, capital and people in the area of the states party to the agreement. All four EFTA accession countries are, of course, part of the EEA.

While the European Economic Area Agreement paved the way for this round of accessions there remained, nonetheless, some difficult negotiations both for the applicant countries and for the members of the Union, as the Joint Committee on Foreign Affairs report points out. In the Commission opinions on membership, agriculture, regional policy and the budget were predicted to be the most difficult questions for all four candidate countries. This proved to be the case.

The applicant countries placed considerable emphasis on ensuring that within the Union they would be in a position to maintain and pursue a high level of environmental protection. In addition, there were a number of issues that were specific mainly to one applicant: for example, fisheries in Norway and transport in Austria.

As I said, at the outset Ireland welcomed the prospect of membership of the Union by Austria, Sweden, Finland and Norway. Ireland has close relations with these countries. We have shared a similarity of outlook on a range of international issues. It is our view, too, that membership by Austria, Sweden, Finland and Norway will help to strengthen the Union. As the various issues arose during the course of the negotiations we were confident that solutions could and would be found.

Agriculture was difficult for all of the applicants. While Sweden had, to a large extent, adjusted its agricultural support levels to dovetail with the CAP, the other countries maintained a range of subsidies that were higher than those provided under CAP. Enlargements in the past allowed monetary compensatory amounts (MCAs) which were adminmistered at borders. However, with the Single Market and the abolition of border controls, a new method was devised to enable the applicants adjust to the Union's system. Under this arrangement the applicants can pay temporary direct payments to farmers for a transitional period, and the Union will pay a financial contribution to these costs over four years. Due to the difficulties encountered for farming in Arctic areas, long-term national aids have been allowed to support agricultural production in specific regions.

Regional policy was also an area where effort was required to find a solution which was acceptable both to the member states of the Union and to the negotiating applicant countries. A solution for the Nordic countries was found through the creation of a new, Objective 6 region. This category will apply to areas with a population density of under eight inhabitants per square kilometre. Objective 6 will therefore cover regions in the north of Norway, Sweden and Finland. Austria has been granted an Objective 1 region in Burgenland. All four countries will also be able to qualify for Structural Funds under Objectives 2 to 5b. It is significant that all the accession countries have an interest in regional policy. This assures a continued commitment to this area of Union activity in the future which is likely to be of benefit to Ireland.

In the negotiations both agriculture and regional policy had budgetary implications for the Union and for the applicant countries. Towards the end of the negotiation a budgetary package was agreed to help the applicant countries make a smooth transition to Union obligations. The Union budget will take over the applicants' European Economic area commitments.

The Commission estimates that the Union budget will gain approximately six and a half billion ECU over the period 1995 to 1999 should all four applicant countries join the European Union. The Union budget, by way of comparison in 1994 alone, is about 70 billion ECU. A decision on how any gain to the European Union's budget should be used must of course wait the entry of the applicants.

On common foreign and security policy the four applicant countries fully accepted the rights and obligations of Union membership as well as the content, principles and political objectives of the treaties including the Treaty on European Union. The Union and Austria, Sweden, Finland and Norway agreed that accession to the Union should stengthen the internal coherence of the Union and its capacity to act effectively in foreign and security policy; the acceding states will, from the time of their accession, be ready and able to participate fully and actively in the Common Foreign and Security Policy as defined in the Treaty on European Union; the acceding states will, on accession, take on in their entirety and without reservation all the objectives of the Treaty, the provisions of its Title V, and the relevant declarations attached to it; and the acceding states will be ready and able to support the specific policies of the Union in force at the time of their accession.

With regard to implementation of the CFSP it was understood that on the day of accession the legal framework of the acceding countries will be compatible with the acquis.

Fisheries was a key issue for Norway in the negotiations. Here the negotiation centred on three key issues: access to waters, access to resources and market access.

The issue of access to waters was resolved by an arrangement that applies an equivalent regime as that applied to Spain and Portugal. Norway will have no greater access to Irish waters than currently obtains and will be subject to a special control system. Norway will not be entitled to an allocation of horse mackerel.

On access to resources the end result from Ireland's point of view is that Ireland's mackerel allocation may be fished east of 4º west. Irish fishermen have reaped some of the benefit of the outcome of this negotiation already and, under the European Economic Area Agreement, Ireland will receive 7½ per cent of the Norwegian cod allocated to cohesion countries. This represents access in an area in which Ireland has not previously had access.

On the issue of market access, a four year transitional period was agreed during which a market monitoring and management mechanism will be put in place to minimise disruptions of the Community market which might arise as a result of the removal of the remaining tariffs of Norwegian fish imports.

Finally, on the fisheries part of the negotiations, a concern for Ireland throughout was that efforts would be made to influence in a prejudicial manner the outcome of the review by the Fisheries Council of the special controls which apply to a number of member states. Such efforts which were made were successfully resisted by Ireland.

For Austria, a major issue in the negotiations was transport. Specific measures in favour of Austria were agreed which allowed the essential objectives of the Transit Agreement between Austria and the European Union to remain in place. Ireland's concern in this part of the negotiation centred on the fact that as we did not have a bilateral agreement with Austria our hauliers should not be disadvantaged. A result that catered for our concerns in this area was agreed.

It is generally acknowledged that the negotiations achieved a good result, both for the applicant countries and for the European Union. For the applicant countries the Union demonstrated that it could take their concerns into account and be flexible in arriving at solutions. For the European Union the successful outcome of the negotiations demonstrated the willingness of highly developed economies to take on the body of laws and rules that makes up the Union system. The successful conclusion of the negotiations also marked the first major achievement for the Union following a period of prolonged difficulty involving the ratification of the Treaty on European Union and European currency crises.

The negotiation process did not, however, prove to be entirely smooth for the European Union. During the course of the negotiations there emerged a debate within the Union on the issue of weighted voting at Council. The European Councils at Lisbon and Edinburgh agreed this round of enlargement could proceed on the basis of the current institutional arrangements. However, when a mechanical transposition of weighted voting at Council was proposed, no agreement among the current member states of the Union emerged. Eventually, after much debate and some delay in completing the enlargement negotiations, a compromise solution was worked out by Foreign Ministers meeting informally in Ioannina, Greece on 26-27 March.

The agreement arrived at provided that with the accession of up to four new member states to the European Union there will be a linear transposition of weighted voting at Council and the blocking minority will move from 23 votes to 27. Member states also agreed that where there are between 23 and 26 votes against a proposal a delaying mechanism would be triggered with a view to reaching a solution satisfactory to all. This solution must be found, or a blocking minority of 27 must emerge within a reasonable time, otherwise the measure on the table can be adopted.

It was agreed that reform of the institutions, including the weighting of votes and the threshold of the qualified majority in the Council will be examined during the 1996 Intergovernmental Conference.

In the period up to the end of 1994 the European Union will wait for the outcome of the referenda in Sweden and Norway with great interest. The people of both Austria and Finland indicated their willingness to become part of the European Union. The Union of 1995 — with up to 16 member states — will face a range of old and new challenges.

The Treaty on European Union provides that any European state may apply to become a member of the European Union. Both before and after the negotiations with the EFTA countries the Union has been in receipt of applications to join from other countries in Europe.

In the context of future enlargement, Switzerland's application for membership of the European Union was put on hold following the rejection of the EEA agreement at a referendum in December 1992. The Swiss application, if pursued, like the EFTA negotiation just completed, would be unlikely to cause major problems or challenges for the European Union.

Outside EFTA, however, there are a range of long-standing and new applications to join the European Union. The longest standing application to join was that made by Turkey. In 1989 the Commission opinion on Turkey's application recommended that for economic and political reasons the time was not ripe to begin accession negotiations. The Commission recommended a strengthening of relations with Turkey. This is being done with the Union and Turkey deepening their relations within the frameowrk of the long-standing Association Agreement.

Cyprus and Malta have applied to join the European Union. The Commission opinion on these applications recommended that negotiations could commence once certain political developments in Cyprus and economic developments in Malta were achieved. The Commission opinion also highlighted the challenge faced by the Union resulting from the institutional implications of membership by these countries due to their small size. At the European Council in Corfu last June it was agreed that the next phase of enlargement will involve Cyprus and Malta.

With the conclusion of the enlargement negotiations with Norway, Sweden, Finland and Austria attention will continue to focus on the development of future relations with the countries of Central and Eastern Europe within the perspective of enlargement.

These applications pose a variety of challenges to the European Union. It is the Union's response to these challenges over the coming decades, as the report of Joint Committee on Foreign Affairs Report on The Enlargement of the European Union demonstrates, that will shape, and inevitably change, the European Union as we know it today. Our goal will be to meet these challenges in a constructive manner while not losing sight of the vital national interests at stake. The quality of our response may determine the future of Europe for generations to come.

For example, one of the tasks of the 1996 Intergovernmental Conference will be to provide for the necessary framework for a Union of more than 20 members so that it can continue to act both democratically and effectively.

A number of the issues that will be up for discussion in 1996 will have significant implications for Ireland. Not least will be one of the issues which caused difficulty during the course of the enlargement negotiations with the four EFTA countries, that of weighted voting at Council. We, together with the smaller member states of the Union, will have to ensure that in any move to greater efficiency and greater democratic accountability in the European Union, the rights and responsibilities of the smaller member states are not overlooked. I am glad the Joint Committee on Foreign Affairs addressed this issue and highlighted some of the areas of particular concern for Ireland. Its report is a most timely and welcome contribution to the debate on the issues raised by the enlargement of the Union to include the countries of Central and Eastern Europe.

These countries are involved in a difficult political and economic transition. They see membership of the European Union as the key to consolidating the results of democratic reform and accelerating their economic development. They also see their membership of the European Union as enhancing their security and confirming their place in Europe.

The European Union has responded positively to the desire of these countries for closer integration with the European Union, by negotiating wide ranging agreements — known as Europe Agreements — which aim at establishing close and lasting relations between the parties. The Europe Agreements which have now been negotiated with Poland, Hungary, the Czech and Slovak Republics, Romania and Bulgaria recognise the aspiration of these countries to membership of the Union. It is expected that Europe Agreements will be negotiated in the near future with the Baltic States and with Slovenia.

Notwithstanding the wide ranging scope of the Europe Agreements the Central and East European states have strongly argued that they are not sufficient in themselves to meet their desire for integration with the European Union. In recognition of this, the Copenhagen and Corfu European Council conclusions developed and added to the provisions of these agreements.

The Copenhagen meeting established that countries possessing such agreements could become members of the European Union as soon as they were able to fulfil the relevant obligations. Two countries — Poland and Hungary — have since submitted membership applications.

The Copenhagen meeting also proposed the development of a structured relationship with the institutions of the Union. The timing of future negotiations as well as the order in which applications will be considered is left open.

At its meeting in Corfu the European Council emphasised the importance of concrete progress in further implementing the decisions made by the Copenhagen Council and asked the Presidency and Commission to report to the Essen European Council in December on the strategy to be followed with a view to preparing for accession.

With regard to timing, the Corfu conclusions state that "the institutional conditions for ensuring the proper functioning of the Union must be created at the 1996 Intergovernmental Conference, which for that reason must take place before the accession negotiations begin".

The Commission presented its strategy paper in July. The main themes of its proposed approach to preparing for accession of the associated countries are: the creation of a framework within which the EU's relationship with the countries concerned can be deepened; the creation of an appropriate legal and institutional environment for economic development and integration; enhancing trade opportunities; macro-economic and other forms of co-operation between the EU and the six associated countries; Community assistance to integration and reform. Intensive work is now being done within the Council in order to prepare for the discussions at Essen.

An important element of the strategy is the establishment of a structured relationship between the countries of Central and Eastern Europe and the institutions of the Union. In this context, work is being done to associate these countries more closely with all three pillars of the Union's activity including the holding of advisory meetings between the Council and Ministers of the countries of Central and Eastern Europe on matters of common interest.

Agreement has been reached to associate the countries of Central and Eastern Europe with the common foreign and security policy and consultations are taking place to work out the modalities to achieve this.

The Ministers for Justice and Home Affairs from the two sides met informally in Berlin in September and discussed increased co-operation in combatting drugs and organised crime in Europe. Further consideration is to be given to co-operation in other areas identified at the Berlin meeting.

Meetings have also been held in the recent past with Ministers for Finance, the Internal Market and Environment.

At the end of this month I shall participate in discussions in Luxembourg between the Foreign Ministers of the European Union and the associated countries of Central and Eastern Europe at which the future development of relations will be discussed.

The pace of events I have outlined illustrates just how timely is the report of the joint committee. The report points out the key issues for Ireland and for the Union raised by the prospect of accession of the East.

It is clear that enlargement, and the preparation of Central and Eastern European countries for accession, will be one of the principal external issues facing the European Union for the remainder of the decade.

Ireland has welcomed the openness to enlargement reflected in the conclusions of the Copenhagen and Corfu European Councils. We recognise that prosperity and stability in Europe as a whole will be influenced by the progress towards political and economic reform in Central and Eastern Europe and we believe it is right that these countries should be confident in the European Union and in our readiness to support the political and economic reform process.

We recognise, however, that the issues raised by enlargement to the East are of a different order of magnitude to those raised by previous enlargements both because of the nature of the challenges facing those countries and the changes which the Union will have to undergo to maintain the process of European integration.

It is essential to maintain the character of the Union as enlargement proceeds. We are committed to a Union which operates effectively. For that reason it is incumbent upon us to proceed at a realistic pace. I fully agree with the committee's recommendation that a balance must be struck between the interests of the applicants and the need for a functioning and effective Union.

The policy implications of an eastern enlargement will be assessed, as the committee recommends in the context of preparation for the Government White Paper on Foreign Policy and the 1996 Intergovernmental Conference. Work on this area is ongoing.

In the meantime, the Government will continue to make every effort to encourage the development of political and economic links between Ireland and these countries and to alert Government agencies, business and agricultural interests and the general public of the mutually beneficial economic opportunities that exist. In so doing, we will help to ensure that maximum advantage can be taken of the opportunities available to Ireland in these countries.

Mrs. Owen

Fine Gael supports the Bill and the motion on the terms of Treaty providing for the accession of Finland, Norway, Sweden and Austria to the EU. As vice-chairperson of the Joint Committee on Foreign Affairs and in the absence of the chairperson, Deputy Brian Lenihan, I present the report of the committee to the Dáil. I want to pay tribute to Deputy Brian Lenihan who unfortunately is ill and cannot be with us today. We send him our good wishes.

I pay tribute to the people who assisted the committee in compiling the report. We are indebted to Professor Bridget Laffan of UCD for her work and research and to Mr. Ted Barrington and Mr. Noel Fahy, assistant secretaries in the Department of Foreign Affairs, who attended at the committee and gave us papers on various aspects of enlargement and oral briefings.

I also pay tribute to the Institute of European Affairs, a fairly new body. This unique institute brings together people with a wide variety of expertise, prepares papers, holds seminars and brings to Ireland speakers who might not have otherwise come here, to address seminars on the implications of European enlargement and the increasing nationalist sentiment in some European countries. They deal with a range of issues which we as parliamentarians might not have the opportunity to research. I thank the institute for the help it gave to the committee.

I want to pay tribute to the ambassadors of all EU countries and Austria, Finland, Norway and Sweden who attended at the committee, made submissions and were prepared to be questioned in depth by members. The information they gave us was invaluable in compiling the report. We also met a number of parliamentary delegations from EU member states and aspiring members of the EFTA countries and other countries including Hungary. Our dialogue with them was invaluable in ensuring a broad ranging report.

The report gives a broad and balanced account of the issues and policies which will have to be tackled, and perhaps altered, as a result of the enlargement of the European Union. In particular, it helps to differentiate between the different stages of enlargement. The EFTA stage is under way, which I think everyone welcomes. The next stage will be much more difficult and present more challenges to Ireland and the other member states of the Union.

The report deals in a very comprehensive way with a number of issues and it is important to remind ourselves of these. It deals with the conditions of membership, which it would do us no harm to look at from time to time; the candidate countries, both the EFTA countries and future candidate countries; the negotiations, the detailed background to these and the way in which agreement was eventually reached on the EFTA enlargement; the countries of the east; the next Mediterranean enlargement, which includes Turkey, Malta, and Cyprus; and the stark choices facing the existing member states of the Union as a result of enlargement. The committee outlines its conclusions and makes recommendations.

The report is a working document of this House. It is not the be all and end all of the position after further enlargement of the EU and for that reason our recommendations lack specifics — they have been described by some people as anodyne.

The report is a starting point for the committee and the White Paper which the Minister will publish shortly and will enable us to make real decisions about, for example, institutional change. It also recognises that the status quo will have to be changed. At one stage the European Parliament said that institutional reforms were required before the EFTA enlargement. However, it was agreed after debate and negotiation that the existing institutions should remain as they were for the EFTA enlargement. The reasons for this are obvious: the clear democratic fora in these four countries, their good economies and the involvement of their populations. There is an obvious need for Ireland to set out in clear terms the institutional changes we want.

The report offers two options, first, a pragmatic evolutionary option and, second, a federal constitutional option. The report clearly signals that on the basis of past performances the most likely option is the pragmatic evolutionary one. None of the existing member states has the stomach for a huge increase in enlargement from 16 to 24 or 26 members, and small steps will have to be taken. This presents challenges for us and we must know where we want to be at the end of the day. We must be firm in our belief that small states must have a proportionate amount of authority and power within the institutions so that the larger states do not take over.

The report deals in a very comprehensive way with the expansion of Europe to the east. This is the biggest challenge facing Ireland. We must recognise that membership of the European Union is a key element of the foreign policy of all countries to the east, for example, Hungary, Poland, the Czech Republic, the Slovak Republic, Slovenia, Bulgaria and Romania.

It is important to remind ourselves that we do not have a monopoly or the right to say to these countries that they cannot become part of Europe as we define it — the Europe of the European Union. Europe, as an entity, was devised in the 8th or 9th century by Charlemagne. As the Romans christianised many areas around the Alps and the centre of Europe, Europe as an entity became known. It was not founded in 1952, 1958 or in 1973 when Ireland became a member. Many countries not in the Union have a greater claim than Ireland to call themselves European. It is timely to remind ourselves what President Havel of the Czech Republic said to the European Parliament on 8 March 1994:

The Czech lands lie at the very centre of Europe and sometimes even think of themselves as its very heart. For this reason, they have always been a particularly exposed place, unable to avoid any European conflict. In fact, many European conflicts began or ended there. Like certain of other Central European Countries, we have always been a dramatic cross-roads of all kinds of European spiritual currents and geographical interests. This makes us particularly sensitive to the fact that everything that happens to us intrinsically concerns all of Europe. We are among the prime witnesses of the political reality of Europe's interconnectedness. That is why our sense of co-responsibility for what happens in Europe is especially strong, and also why we are intensely aware that the idea of European integration is an enormous historic opportunity for Europe as a whole, and for us.

We should remember those words and that in opening the doors of the Union to countries such as the Czech Republic we are doing no more than giving them their rightful place in an expanded Europe. It is not to underestimate that the process of transformation in these countries will be enormous to qualify to become members of the Union. Our adaptation and that of existing members, our rules and regulations, institutions and policies will be mind boggling to say the least. In our report we remind ourselves of what was said by the Danish President of the Council in February 1993 when setting out the principles that would govern enlargement and Pillar Two of the Treaty. The principles were:

— enlargement should strengthen the internal coherence of the Union and its capacity to act effectively in foreign and security policy.

— applicants must from the time of their accession be ready and able to participate fully and actively in the CFSP as defined in the TEU.

— applicants must take on in their entirety and without reservations all the objectives of the treaty, the provisions of its Title V and the relevant declarations attached to it.

— applicants should be ready and able to support the specific policies of the Union in force at the time of their accession.

They are challenging aspirations for membership of the Union. We know that many of the countries seeking membership are not able — and will not be able for many years — to take up those principles and make them their own.

At the Copenhagen Council in June 1993, following sustained pressure from the countries of the East to have further links with the Union, the conclusions of the Council stated:

The European Council today agreed that the associated countries in Central and Eastern Europe that so desire shall become members of the European Union. Accession will take place as soon as an associated country is able to assume the obligations of membership by satisfying the economic and political conditions required.

These cannot just be words, they must be felt and meant by members of the Union. We must have an aspiration to encourage and embrace countries of the East and Central Europe to our Union. There will be painful times ahead for Ireland and for all the members. There is no point in agreeing to the Conclusions of the Council of June 1993 unless we are prepared to put our money where our mouth is. When we reflect on the challenges and the enormity of the work that has to be done in these countries we must give wholehearted support to the associated agreements, the trade agreements and to opening up our markets to these countries. The three broad criteria for accession agreed at the Copenhagen European Council are as follows:

Appropriate and compatible political systems;

A functioning market economy capable of competing in the EU;

Acceptance of the acquis and the longer term political objectives of the Union.

They will not be able to reach those aspirations unless they get assistance from us and from other countries in the Union to develop their democratic institutions, to educate their people that democracy can work, that dictatorship is not the only way of governing a country and that democracy gives people freedom, human rights and civil rights.

I am glad that in our report we laid emphasis on the need for proper human rights in countries seeking membership and that there should be a benchmark by which human rights can be gauged before they can be accepted as functioning members of the Union.

I welcome the fact that the people of Finland and Austria voted to become members of the Union in January 1995. We have high hopes for the two referenda in Norway and Sweden but we should not be blind to the implications of a "no" vote in either of these countries. The Danish "no" vote in the Maastricht Treaty almost caused the collapse of the Union and the Maastricht Treaty and threatened the stability and security of the integration in Europe. If there had not been a second vote accepting the Treaty, it would have brought the enlargement process to an end. It is clear that the "no" vote in Denmark was the voice of the citizens because the Government, the Ministers, most of the political parties and the spokespersons endorsed the Maastricht Treaty. The citizens of Denmark decided they did not want to accept the patriarchal and unconvincing lecture, as they saw it, from the head, that the Maastricht Treaty and all its clauses and appendices was suitable for them. In varying degrees they said: "We are unhappy, we are disquieted, we are downright opposed to this patriarchal handing down of the Treaty". There is no doubt that the leaders of the Union got a fright. They thought because they had decided, mostly behind closed doors, that the Maastricht Treaty was for the good of all the people of Europe everybody else would accept it. It was rather like a doctor telling a child to take a particular medicine which has a sour after taste and that he would feel much better. There was a patriarchal attitude that everything would be right.

We know from our own debate here that many issues not considered relevant to the writers of this Treaty were those that caused most trouble. The issues that arose here during the debate on the Maastricht Treaty were not the ones which we, as politicians, thought would be central to the debate. There was a scare that there would be a conscripted army in Europe, that certain social legislation would be handed down to us and that we would have no choice but to accept it or we would be shown the door. These were the issues that concerned the people of Ireland. Different kinds of issues concerned the people of Denmark. During the negotiations between Sweden and Norway and the Union issues such as whether snuff would be allowed exercised the minds of the people there. They thought their habit of using snuff would be outlawed in Europe. Those were the type of issues — not macro ones — that nearly brought the negotiations to an end.

Minister of State at the Department of Finance (Ms E. Fitzgerald)

Issues such as the one relating to bent bananas.

Mrs. Owen

Issues relating to cucumbers and the percentage of chocolate in chocolate bars——

Mr. Connor

And red lemonade.

Mrs. Owen

——and the size of the baby power bottle and so on are the ones which affect people's daily lives. The implications of a "no" vote from Sweden or Norway would be devastating. An excellent report on EU enlargement prepared by Tony Browne of the Institute of European Affairs at page 81 states:

A "no" vote in one or more of the referenda on accession to the Union would undoubtedly be most damaging for the entire project of integration.

The report goes on:

In such a situation, a negative result in any of the four referenda would reflect not alone serious internal political problems — of communication or trust — but also a rejection of European integration as reflected in the Maastricht Treaty .... But the political reality is that the enlargement process now under way has become a touchstone of the future shape of the European Union and of the Continent as a whole. Rejection by any one of the four candidates, with their impeccable democratic and participative credentials and outstanding records in terms of human rights, social and environmental standards and contribution to security and stability, would be seen as a major body blow.

I hope the dire warnings of the implications of a "no" vote are not necessary and the two countries who have yet to hold their referenda will vote "yes". If one of them votes "no" it will bring to an end the forward motion of integration and enlargement.

We must reflect on why the arguments for the Maastricht Treaty did not engage the people of Denmark and caused a lively debate. The economy of the EU has been the unifying bond leading Europe, but the "no" vote in Denmark highlighted that the economic element is not enough to engage people's emotions in the expansion of Europe. There has not yet been an emotional commitment to Europe as a concept. The economy is not enough to establish one's European identity.

Let us reflect on our position. All debates here are dominated by economic elements, about whether we will get structural funds, farming or road grants. We must move on from such debate and recognise that there are more advantages to being part of an enlarged Europe than merely what we can get from it.

As our businesses are influenced by businesses in Europe, our educational institutions are linked with European institutions, our students participate in exchange programmes such as Erasmus and Petra and open their minds to what is happening in countries such as Belgium, France, Germany, Portugal and Spain and as people intermarry with Europeans and expand our links with our European partners, we will begin to realise the boon of membership and enlargement for our people. Enlargement is not only advantageous for east and central European countries, it is also to our advantage. We have achieved a great deal by creating a Single European market, but many European citizens have got used to the idea and no longer appreciate the advantages we receive.

The removal of trade barriers, the free movement of capital, vocational mobility and the expansion of markets as advantages and dare anybody say we should not say "yes" to an expanding market for Irish products. However, we must heed warnings about the negative effects of environmental damage, energy consumption, waste management and increased traffic and pollution levels. Those matters must be taken seriously and not dismissed as negative prophecies of doom merely because they are raised by people who may not share the European ideal. Those issues exercise the minds of people in Ireland and other member states more than the removal of trade barriers and the effect of their regulations on people's daily lives will harness the emotions of people in Europe. Those are the issues that engage the minds of ordinary people, the issues about which they talk as their villages and cities become polluted and they cannot move around freely because of traffic gumming up the wonderful new roads Europe is allowing them build. We will ignore those issues at our peril. We must recognise them as we expand towards the east into Central Europe, where enviromental issues have not been considered by the outgoing dictatorship Governments. We have an enormous role to play in that regard.

The report refers to the policy objectives which must be tabled. As the likely model of institutional reform and change will be a pragmatic and evolutionary one with many small treaties we will require a clear long term strategy from Ireland and other member states. Each State, if it is to be successful in the peacemeal negotiations, must monitor its long term objectives. The Benelux states and the UK have somewhat different visions but Ireland lacks a long term strategic plan. I hope with the publication of the White Paper and the Communicating Europe PR programme which the Minister, Deputy Kitt, is implementing, the people will engage in a discussion on our place in an enlarged Europe. To date our stance has been short-term and utilitarian. We have relied on our diplomatic and negotiation prowess, the chat in the corridor, the slap on the back, the nice lunch with a commissioner, Prime Minister or Minister to ask them not to forget us in the negotiations for grants. By and large that type of diplomacy has been Ireland's forte and has worked well until recently. However, the débâcle of the Euro billions illustrates that that type of diplomacy will not work in an enlarged Europe. The best friend of Ireland and the small states will be transparent and open rules and regulations under which we can be given our rightful place and share, and not be dependent on the friends we meet in the corridor.

The need to recognise that this kind of diplomacy will not work has been advanced by many writers on the issue of European enlargement. I might cite one such writer, Mr. Ben Tonra, a lecturer in the Department of Political Science in Trinity College, Dublin and an adjunct fellow in international politics at the Center for Strategic and International Studies, Washington, DC. Writing in The Irish Times on 29 December 1993, he stated:

A world of increasing complexity and new centres of power; where do small states such as Ireland fit in? When their limited economic, political and military muscle makes them look like featherweight contenders in a heavyweight title fight, where can they turn to exert the greatest influence to best effect?

Ireland and other small states must now concentrate not on the corridor-type diplomacy and the Irish mafia we have in Brussels but rather on building a number of different strategic inter-state alliances, the kind of alliance we formed with France in the GATT negotiations and which we might form with the countries coming in who declare themselves to be neutral states. It is with those alliances we can maximise our influence and power. Unless we recognise the changes that an expanded European Union will bring we will not matter. That would be a disaster for this country. I hope Members of both Houses and people interested in European enlargement will read this report of the Joint Committee on Foreign Affairs on European Union enlargement and recognise that we have a role to play in the future expansion of Europe.

Mr. Gilmore

This debate on the enlargement of the European Union affords us an opportunity to reflect on the development of the European Union and on progress, or lack of it, since the Maastricht Treaty.

I welcome the enlargement of the European Union to include Finland, Sweden, Norway and Austria. My party will be supporting the motions and the Bill before us. However, it is somewhat ironic that new countries are joining the European Union and others seeking to join at a time when the momentum within the European Union which arose from the Maastricht Treaty appears to have slowed down very considerably.

The European Union is at present beset by high unemployment, low growth rates, social disintegration and a resurgence of nationalism and xenophobia. In the face of these challenges those who purport to lead the European Union have purposely shied away from any radical solutions. Recent Council meetings have degenerated into squabbles over jobs for the boys, in comparison with which relations between our Taoiseach and Tánaiste appear positively cordial. There is ambiguity within national governments and European institutions regarding the European Union's future direction and uncertainty regarding the 1996 Maastricht review. Yet, within a few years, this uncertain political and economic entity may expand to include most of the states currently in the Council of Europe. The coming decade is likely to see the European Union grow to around 25 members including countries with vastly differing economic, political and social objectives, all proceeding at various speeds and with varying degrees of enthusiasm towards completion of the Maastricht process.

It is the Maastricht Treaty itself which is at the heart of the European dilemma. The Treaty on European Union has proved to be a deeply flawed instrument, rushed through as a hasty response to the political changes which took place in Europe at the turn of the decade. Let us recall the history of the passage of the Maastricht Treaty. Initially the Danes voted against it and the French gave it grudging assent only. It was constitutionally challenged in Germany and passed by the British House of Commons by a handful of votes. It probably would have been rejected had it been submitted to a referendum there.

The Maastricht process today is badly off target. I doubt whether even the 1996 review can breathe new life into it. Monetary union was dealt a severe body blow by the currency crisis which saw the European exchange rate mechanism, that much vaunted instrument of monetary stability, collapse in disarray. Europe's mandarins watched helplessly as assorted central banks frittered away millions of ECUs in a vain attempt to defend various currencies, including the punt.

Similarly, European political union is on shaky ground. Brussels rule is proving increasingly distasteful to Euro sceptics of various nationalities, some of whom base their opposition on populist scare stories about red lemonade, green peas, pink sausages, bent bananas and all the rest of it, while others are justifiably concerned about the lack of democratic accountability which pervades the European Union and its institutions. The Maastricht referenda both here and elsewhere in the European Union highlighted the democratic deficit. This has yet to be addressed and until this is done I believe any further steps towards European political union are in danger of being rejected out of hand by the vast majority of the European Union's citizens. Governments would be well advised to address this issue before the 1996 Maastricht review.

The greatest failure in the Maastricht process was its failure to involve the citizens of Europe. The drive towards European Union was advanced by a small political élite in Europe who failed to understand that the population of Europe would itself have to understand the necessity for European Union and be committed to it. The attempt to create European political structures not understood by the great majority of Europeans and which are distrusted by many, while at the same time little or no effort is made to involve the individual citizen in the project, is extremely dangerous. The extent to which the population of Europe is alienated from the concept of European Union is demonstrated by the low turn-out in the recent elections to the European Parliament. While most of the political leadership in Europe seems committed to European Union the public seems, at best, sceptical. In Ireland great comfort was taken from the high "yes" vote in the Maastricht referendum. We must exercise a certain element of caution. There was a low turn-out in the referendum itself. One must wonder how our citizens would have voted if, instead of being a net financial beneficiary of European Union, our taxpayers had to put their hands in their pockets to pay for it.

It is essential that the citizens of Europe be committed to the concept of European Union. If necessary, the political leadership in Europe will have to slow down to explain the concept to its citizens, to involve the public in the process and ensure there is tangible evidence that the European Union is not some dry treaty text but is a reality. It means that, when people travel within member states of the European Union, the practice of having to produce their passports and so on will have to be discontinued. There is the right of the Irish people to enjoy the same living standards as the rest of Europe and a recognition by the larger members of the European Union that there can be no question of a two-speed European Union.

When Ireland passed the Maastricht Treaty it voted for a concept of Europe based on 12 member states who would enjoy equal status within the Union, albeit recognising the different sizes of countries and populations. The new proposal for a hard core consisting of France, Germany and the Benelux countries is completely at variance with the concept of European union in which the people of this country have made an act of faith in successive referenda.

Despite protestations to the contrary by our Government, the multi-speed Europe now being touted in French and German circles is fast becoming a reality. There is a grave danger that Ireland will be relegated to one of the slower lanes, left with a few crumbs from the Euro funds table but with very little say, possibly even without a commissioner in an enlarged Commission. The Government must make it absolutely clear that we cannot accept a two-speed Europe, that it is unacceptable that this country should be relegated to a second division, that our people have committed themselves in referenda to the concept of a European Union and cannot tolerate what would amount essentially to the original Six constituting themselves, or at least most of them, as the hard core of Europe, the élite of the European Union, with the rest in some kind of outer orbit around that.

It is essential that we, as a member state of the European Union, assert our right not to be left behind. If that means some of the other countries who seem to want to advance particular aspects of the European project at a faster pace will have to slow down, then so be it. If the concept of European Union, an idea to which so many people subscribe, is to become a reality, it will be necessary for member states and their populations to be brought together.

My party has always supported the concept of a social Europe, a Europe of citizens, in which the rights of all will be guaranteed both centrally and locally. The ethos behind a social Europe is best exemplified by the Social Chapter which has yet to enter full force. I am especially disappointed that acceptance of candidates for EU membership was not made conditional on their endorsement of the Social Chapter. I would have welcomed a more extensive analysis of that subject in the report of the joint committees.

It is ironic that the issue which is posing the greatest difficulty in convincing the populations of Norway and Sweden to vote for entry to Europe is their fear that the European Union is not committed to the Social Chapter and that membership of the European Union will dilute the high level of social protection currently available in those countries. I hope that the people of Norway and Sweden join the Union, but the prognosis is not great. The latest opinion polls show that the "yes" and the "no" vote in Sweden is very finely balanced. In Norway it appears that those opposed to entry are very far ahead in the opinion polls at this stage. We need to reflect on the concerns exercising the minds of people in Norway and Sweden about entry to the European Union. I do not agree with Deputy Owen that what is bothering the people of Sweden is the availability of snuff or whether alcohol will be sold as widely as in Connemara. The question occupying their minds is whether the European Union would give workers in those countries the same level of social benefits and protection they enjoy at present. What is causing workers in Norway and Sweden to wonder whether they should vote "yes" for Europe is their concern about whether they would be joining a European Union in which the question of social protection and legislation is on the back burner. Vetoes are exercised by Governments, like Britain, in the implementation of various aspects of the Social Chapter. What message does it send to workers in the existing 12 member states that the biggest worry of workers in Norway and Sweden is that their rights may be compromised by joining the EU? Surely that is the most damning comment on the EU's lack of commitment to social protection. I hope voters in Norway and Sweden vote to join Europe because it would greatly help the position of those seeking to strengthen the social dimension of Europe. That would have an immediate current relevance for people in Ireland because it has been noticeable in recent times that some forces here have begun to add their voices to the British Tory right calling for either a dilution of the social dimension or a withdrawal from it. It is even more remarkable that those calls have come from sources who were loudest in calling for a "yes" vote in the Maastricht Referendum.

The Leader of the Progressive Democrats has recently called for the development of a low waged economy in Ireland. She has offered the model of Hong Kong which must be an appalling prospect to people trying to survive on their earnings here. Does she not know that the average income in Ireland is still only 70 per cent of the European average? Is she now suggesting it should be less? When her party called for the Irish people to vote "yes" for Europe, did she mean that the Progressive Democratic concept of European Union excludes those at work and those on low incomes?

Similarly, IBEC who was loud in its commitment to a European Union at the time of the Maastricht Referendum now seems to want to exclude workers and their families from the benefit of European Union. IBEC wants less European legislation on workers' rights. It wants a Europe which is free and united for the owners and captains of industry, but which leaves workers at the mercy of individual employers. It is important that the wider public are involved in this European project. People here are now entitled to ask some basic questions about why the economic benefits of Europe are not being passed on to them. Why, if we are one of the two member states meeting the Maastricht convergence criteria and have the highest level of economic growth in the European Community, do we still have the highest level of unemployment in Europe? Why do our people still only enjoy 70 per cent of the average income in Europe? When it came to the referendum those people wanted us to rush blindly into the European Union, but they now seem to want to put on the brakes on the benefits the European Union might bring to workers and their families. The concept of the European Union applies to all citizens, there cannot be a slow track for small states like Ireland and an even slower one for its citizens.

The European Union is, increasingly, being subjected to a new and potent division between those states which accept the Social Chapter in its entirety and those which have either obtained a full derogation or opted out of sections of the chapter. I fear that the failure to ensure that new applicants accept the chapter will emphasise those fault lines in the future. The concept of a social Europe has in recent times been whittled away by successive Council meetings and summits to the point where its central manifesto, Jacques Delors's White Paper on Growth Competitiveness and Employment is now little more than a set of loosely linked aspirations. I pay tribute to the work of the Irish Commissioner, Pádraig Flynn, in this regard. He has championed Delors's White Paper and made a serious attempt to move it ahead. I am aware there is some speculation as to whether he will remain in the Social Affairs portfolio or move to another one. I hope he will remain in his present portfolio because he appears to have a grasp of it and a commitment to move forward. I know Tommie Gorman is a well placed source in European circles and if he said that Commissioner Flynn is staying in the Social Affairs portfolio, I am sure that is true.

Mr. Connor

He is an admirer of Commissioner Flynn.

Mr. Gilmore

It appears, despite all the fine talk about European Union, that many of the Governments of Europe view it from a selfish perspective. A long term expansion of the EU to include poorer countries, such as Turkey, would leave Ireland with a much smaller slice of the financial cake while, in the short term, a sector such as agriculture would be in competition with new members. However, I hope the Government will depart from tradition and focus on the long term rather than the short term interests of Ireland and the EU.

Although I welcome new members and any move towards the idea of a common European home, I am concerned at the lack of debate within the EU regarding the implications of hasty expansion and, in particular, the implications of an unpremeditated drive to the east being promoted by the German Government. We have entered an era of instability unprecedented since the end of the Second World War, an era of high unemployment and social polarisation which is resulting in political extremism. Less than a fortnight ago the far right Austrian Freedom Party captured over 22 per cent of the vote on an anti-EU platform, liberally laced with zenophobic rhetoric. Recent elections in Belgium produced surprising gains for the extreme right. Neo-Fascist parties in Germany have been exercising an extremely vocal and effective extra-parliamentary opposition, and Italy is already governed by a coalition involving Fascists. Europe is moving inexorably rightwards.

The idea of European Union is, indeed, exciting and laudable, but there are dark traditions in Europe and these are now being echoed by some of the new European right, and the rise of the extreme right all over Europe, both within the European Union and outside it, raises fundamental questions, first about the viability of the EU itself, if we are going to see such an increase in extreme right wing nationalism, but also about the nature of the European homeland which we are building. Unless the European right and the ideas which the European right represents are defeated, there is a grave danger that the European Union will either disintegrate or, alternatively, become a very unpleasant monster indeed.

Those within and without the European Union who regard the European Union with suspicion are not confined to the extreme right or to nationalist elements. The result of the Finnish referendum last Sunday produced a clear "Yes" result but there was a significant minority who, with some justification, were concerned that they would be sacrificing democratic powers to an undemocratic centre. That stand mirrors similar arguments made in Denmark in the run up to the referendum on the Maastricht Treaty and the arguments made by Democratic Left during the debate on the referendum here. I do not agree with Deputy Owen that the referendum in Ireland centred on ungrounded fears; there was a substantial debate here about the nature of European democracy, the absence of democratic accountability in some of the European institutions and the prospects for economic and monetary union. Indeed, many of the things which the critics of the Maastricht Treaty stated about European economic and monetary union were subsequently borne out in the currency crisis which occurred shortly afterwards. Rather than attempting to dismiss opposition to individual referenda and the critique of the way in which European Union is being progressed as some kind of eccentric argument, as certainly happened here during the referendum on the Maastricht Treaty, it would be better if everybody took on board the serious criticisms which are made of the way European Union is progressing.

The enlargement of the Union also has severe implications for the EU's common, foreign and security policy. At the start of accession talks between the EFTA countries and the EU in 1993 the Council stated that enlargement would be governed by the following principle: "Enlargement should strengthen the internal coherence of the Union and its capacity to act effectively in foreign and security policy." In effect, applicant states have to commit themselves to the implementation of a common, foreign and security policy and the eventual formulation of a common defence policy in accordance with the Maastricht Treaty on European Union. That common defence policy will be the subject of the 1996 Maastricht review.

The reasons some of the applicant countries were eager to sign up for a mutual defence package are clear. Finland, in particular, is threatened by an unpredictability to its east and is especially worried about the spectre of the coming to power of the Neo-Fascist Vladimir Zhirinovsky who has made no secret of his ambitions to swallow up Finland at the first available opportunity. Therefore, the prospect of a mutual European security accord is attractive to the Finns. It is understandable that they should look to the West for some comfort and support in the face of a volatile neighbour.

That, of course, raises fundamental questions for countries like Ireland which have pursued a traditional policy of neutrality. It has long been apparent that in the face of new alignments, both within and outside the EU, Ireland will have to rethink its traditional policy of neutrality. We will have to shift from a passive non-involvement towards a more active concept of neutrality, a concept which concentrates on the multilateral building of peace rather than on the unilateral making of war. Many of us had hoped that the accession to the EU of neutral countries such as Finland, Sweden and Austria would have shifted the balance within Europe from a narrow NATO orientation towards an orientation around the principles of the CSCE. It still remains to be seen whether that will be the case.

The issue now is how Europe is going to maintain peace within the borders of the European Union, between the new states which are emerging in eastern Europe and with the rest of the world. The first difficulty which will have to be faced in the run-up to 1996 is to define what we mean by a European common foreign and security policy. When people say that if we are part of Europe we must be prepared to defend it they will have to say what they mean by that. Who is the perceived enemy against whom Europe is to be defended? What is meant by security and defence in the current context of Europe? These questions must be addressed and resolved to our satisfaction before any defence policy is considered in 1996. In other words, before the 1996 process goes down the road of putting in place a framework, institutions and so on in relation to defence and security, Europe needs to be clear about what it actually means by a common foreign and security policy. That needs to be debated openly and involve the widest number of people.

All of that will come into play in the 1996 review of the Maastricht Treaty. That review will be critical for the European Union process. It will be critical for institutional change, the position of the Parliament, the Council, what kind of commission there will be. It will be critical to setting the scene for the future enlargement of the European Union and particularly the inclusion of the Eastern European countries. It will be critical to the evolution of the common foreign security policy and the defence policy. It will be particularly critical in redefining the relationship between the larger and the smaller member states.

There is the position now being advanced in German and French circles about the hard core. There is also the attempt by some elements in Great Britain — this may change after the next general election — to opt out of certain aspects of the European commitment. That is taking place at one level. There will then be the difficulty which that will pose for the smaller member states and it will be critically important that they assert their position in the discussions up to 1996. There can be no question of a State like Ireland being left on the outside track. There can be no question of institutions like the Commission being redeveloped, or redefined, or reinstituted in any way which undermines and dilutes our position.

The Government is in a very strong position in terms of the 1996 review of Maastricht because Ireland will take over Presidency of the Council at the end of 1996. The review will probably commence in Dublin during Ireland's Presidency. We waltzed into the last Presidency with no position on anything and any attempt to open debate in this House on Ireland's position in terms of the future of Europe was met with blank stares.

The Government needs to prepare now for the 1996 review. This country has a unique and, possibly, final opportunity to set the agenda for the future of Europe, particulary for our position within Europe. All issues such as our position within European institutions and vis-á-vis economic benefits of European Union, common foreign and security policy and defence, our neutral position and so on depend on the way the Government approaches 1996. Instead of responding to the initiatives and proposals put forward by political forces in other member states the Government should put forward a Presidency position on the future development of the European Union and be in a position to set the agenda in 1996 so that we have an effective Presidency which will shape the future of the Union in a way that is beneficial to this country and to the citizens of Europe.

Mr. M. McDowell

It is timely that this House has the double advantage of considering in legislative form the expansion of the European Union and also the report of the Oireachtas Joint Committee on Foreign Affairs on the implications of European expansion. The debate on Europe is a very impoverished one in which in large measure there is a degree of reticence and shyness about expressing in concrete form Ireland's vital national interest.

Our country has made a virtue of being more communitaire than any other state in the Union. We look down our noses at Britain for its somewhat ambivalent attitude to the European Union and to the Social Chapter. In particular, in the persona of our Commissioner, Mr. Pádraig Flynn, we posture as a country that is hell bent on further implementation of the European Union's social policies. It is fashionable in Irish politics to say that you are pro-European. It would probably be regarded as very bad form and politically incorrect to exhibit hostility, let alone cynicism or, to use the British term, scepticism, towards the process of European Union. That overall mindset among the Irish political establishment disguises a fundamental problem which we are not addressing, that is that Ireland has vital national interests, which come into sharper focus in the run-up to 1996, and that those vital interests are not necessarily the same as those of the so-called fast track nations of the European centre.

It is very well to say we believe, as I do, in a single currency and that we accept and are working towards convergence criteria under the Maastricht Treaty in respect of European Monetary Union, but it is different to say that our interests, particularly our economic interests, are coterminous with those of Holland, Belgium, the Federal Republic of Germany and France. Whether we like it or not, we are geographically and economically peripheral and disadvantaged. We are a country that requires things of Europe different from many of the more established and heavyweight players in the European Union.

I wish to draw attention to the European Union's complete failure in the area of unemployment. This is of crucial importance to the countries of the Iberian Peninsula and to Ireland. It is in that respect that we have a very different interest from that of the fast track nations of Europe. We have a growing workforce, whom our economic policies are failing. There are 276,000 people on the dole and in addition there is an army of people on social employment schemes. We can put our hands on our hearts and say that the market economy in terms of employment is failing the Irish labour market to the tune of at least 300,000 jobs. With demographic developments which are foreseeable and inevitable, as Dr Donal de Buitléir told a recent Conference of Religious of Ireland seminar in Milltown Park, in order to tackle the employment issue this country would need to generate jobs in the order of 70,000 per annum between now and the turn of the century. There is no prospect on existing policies that that number of jobs will be achieved.

It is not enough to say that since we cannot guarantee full employment by the end of the century we can turn our back on the employment issue. We cannot and we ought not do so. As an economy we are particularly charged with the duty of facing up to what is going wrong in Europe in general and in Ireland in particular in terms of the employment issue.

It is noteworthy that in the 22-year period 1970-92 economic growth in the European Union countries outstripped that of the United States of America. It is also worth while noting that employment increased by 49 per cent in America whereas it increased by 9 per cent in Europe over the same period. Europe is worse than anywhere in the world in terms of its economic and employment policy. It is the poorest region in its response to unemployment. As a political and economic community it is the most unsuccessful in providing jobs for its citizens. Those facts must be addressed by everybody. Why is Europe, as compared with North America, the Pacific rim nations or any other economic region, so much of a failure in providing employment and integrating people into the economic life of its member states? Why is Europe so backward in dealing with the unemployment issue? That is the crucial question this House and the Irish people must address. The answer to that question applies not only to our interests in Europe; it also applies to our interests in combating unemployment, creating real sustainable economic growth and increasing employment in our economy.

It has been noted that there are two economies in Ireland, the paper economy which involves Coca-Cola syrup being exported to take advantage by price transference of lower corporate tax rates in Ireland, and the real economy where there are 276,000 people on the dole and a further number on social employment schemes. Three hundred thousand would-be workers have been condemned to internal economic exile, a form of human set-aside — to use a European term. The social policies we are pursuing are inadequate to deal with the problem and this is compounded by the fact that, in a European context, we are unwilling to face up to Ireland's interests, particularly as a high unemployment area.

It is worth reminding ourselves of the response to parliamentary questions tabled by my colleagues and me yesterday to the Minister for Finance. The age old problem in the economy was shown in stark relief. A married man or woman with a dependent spouse and four children, living in a local authority house, paying differential rent, entitled to family income supplement and the cash value of a medical card and paying average travel costs is worse off if their income is between £8,000 and £13,000. If the bread-winner works overtime or takes a second job to try to improve his position he will still have less disposable income if he earns less than £13,000.

This is the only country in the European Union which has such a grotesquely anti-work tax system, where there is such massive downward pressure on participation in the employment market; where a person earning between £8,000 and £13,000 — the average industrial wage — living in local authority accommodation with a family of four children is penalised and has less disposable income. What kind of madness has taken over this country that we say this is fair or proper? Given that the Government sports among its members a party of Labour comprised of people who are supposed to be concerned about workers, those earning less than the average industrial wage and the have nots in society, what kind of country builds an economic wall against their participation which means the more they try the less they have, in terms of disposable income? What kind of economy, Government, coalition or ideology could possibly say that that is justified? None.

It is in that context we must consider Ireland's stance on European Union measures. We need to adopt a radically different approach to the issue of participation in the social and economic life of this State. We must get the message across to our European partners that a radically different approach is needed throughout the European Union.

Last night I watched a television programme about the social welfare system in one of the aspirant member states of the European Union, Sweden — I do not know if other Members saw it. What is amazing is that in Sweden there are also poverty traps but at a much more plush level. In Sweden, for many people, the difference between being employed and unemployed is negligible. One individual admitted that he was better off not working as he receives 90 per cent of what he would earn sitting at home and was being encouraged to participate in an environmental awareness group to keep him busy. That is the kind of society that is creating mass unemployment. It is curious but the one thing which distinguishes Europe is its approach to the labour market, social insurance, unemployment and so on.

Some Members believe it is fashionable to say we should pursue the Social Chapter with great vigour, laud Commissioner Flynn for the social advances made and press for the implementation of the Delors White Paper and the more recent discussion papers emerging from the European Union. We should have a different agenda and I make no apology for advancing a different view.

The cornerstone both in Europe and in Ireland, in terms of assistance for the labour market and for those whom the market is failing at present, should consist of a participative response. Some may condemn this as pay limitation of workfare but I do not accept this. If our society, as Belgium is now doing, faces up to the issue of what the response should be to long-term unemployment, in the last analysis it must be a participative response, it cannot be the present policy of human set-aside.

In this context Ireland should favour flexibility in the labour market and entry to it through part-time employment. The thrust of the attitude of the social partners in this country to employment has been wrong — to bolster the inhibitions towards providing employment by doing their level best to equate part-time with full-time employment. This is radically misconceived and explains in large measure why Ireland and Europe are doing so badly compared with other economies throughout the world.

It is noteworthy that in Europe 42 per cent of the total number of unemployed are long-term unemployed and in Ireland, the sickest of the sick European states, the figure is 62 per cent. This compares unfavourably with the figure in other economic regions. It is not a matter of there being something temporarily wrong with Europe or that some economic cycle has put Europe in this position; Europe has the highest long-term unemployment rate and is grossly out of line with the rest of the world and within Europe Ireland has the most disproportionate percentage — 62 per cent of those on the dole in Ireland are long-term unemployed.

In that context I argue that the Government must go to Europe with a different agenda centred on participation. Within our own economy we must transform the welfare-tax equation which at present penalises those at the lower end of the ladder who are worse off if they work harder under this Government, which includes the Labour Party. As a society we need to transform this whereby the Government says that if the market is failing to absorb those who are willing to work it will put in place a different, inclusive and participative response to long-term unemployment.

I know it is far easier for the Department of Social Welfare to send out a cheque. It is similar to the land set-aside scheme where people are paid to do nothing with the land, satellite photographs are taken and the land is inspected regularly to ensure that it lies fallow. We are doing the same to our unemployed. The message from this Government to those on the dole is not to do anything, not to help themselves, not to get a job, but that even if they do, not to try to earn more because the Government will grind them down. There is no other message and current policies offer no hope to such people.

Employment will have to be our priority in our approach to the European Union. We will have to say that we do not want to hear about paternity leave but about policies to get more people working in the economies of Europe. We challenge that 40 per cent figure. We want mechanisms to bring more people into employment and we do not want to hear about new methods to make employment more expensive and less attractive. That is our most pressing vital interest and it should be the agenda for Ireland in Europe.

I listened to Deputy Gilmore talk about neutrality and such issues as if they matter a fig to a person stuck in the poverty trap and as if it really matters whether Ireland has observer status at the Western European Union. Employment is a vital interest. We do not have vital interests of other kinds which should provoke a national debate if we cannot provide the elementary solution to our most significant problem, unemployment. If, in the next budget, there is not significant action to address the figures released yesterday on the poverty and welfare traps, one can take it for granted that the Labour Party does not represent labour but a group of people who only want to stay in office regardless of the interests of the group in society which it claims to represent.

A number of paragraphs in the report deal with the economic and budgetary implications for Europe of expansion to the east where the population, generally speaking, compared with the west of Europe, is underprivileged and dependent on agriculture. There can be no doubt from the Irish point of view that there will be a call on funds which may now or in future be made available for cohesion, social development and regional policy in the European Union and that every demand we make and every moral case we argue in the halls of Brussels could be made with far more force and truth by new applicant members from eastern European states. Ireland has to work out the implications of expansion of the European Union to the east. There is clearly a German interest in not being the eastern frontier of the European Union and the German Chancellor, Helmut Kohl, has made it very clear that he does not want Germany to be the frontier between the European Union and a vast eastern economic wasteland because he believes that threatens Germany's vital interests. However, we as a society must ask ourelves about our future entitlements under the Cohesion and Social Funds and regional transfers within Europe, if such an expansion takes place. This document, on whose generating committee I served as a member, if it suffers from any fault and I am deeply indebted to Dr. Brigid Laffan for the huge amount of work she put into assisting the committee in its formulation — it is that although it identifies the problem it does not tease out the implications for Irish policy. It does not really say whether Ireland ought to favour a rapid expansion of the European Union to the east and it does not spell out in monetary terms the implications for Irish farmers of bringing Poland and other agricultural economies into the European Union. It does not really address what will be seen as vital national interests in Ireland, consequent on the European Union's expansion.

Do we seriously believe that the highly regulated cosseted employment markets of the European Union, which are so unsuccessful in generating new jobs, are applicable to the economies of Eastern Europe where there is a vast surplus of available manpower? Do we seriously believe that the Social Chapter can be extended to the Danube and the Black Sea and that we can expect that those countries, with their particular economic problems, will enter the European Union and participate on a competitive basis with Ireland in any foreseeable circumstances? I would like an honest and open evaluation of the implications of such an expansion for Ireland's European budgetary entitlements and for the country generally. It may be argued that the Scandinavian countries will be net contributors if they join the European Union, and doubtless they will, but if they are to be counter balanced by an expansion of the European Union to the east we must face up to the proposition that Ireland's vital interests are affected and that it cannot in a blithe way say it favours the expansion of Europe without regard to the consequences for its own economy.

A point made forcibly in a number of international economic journals of recent times — which is worth thinking about — is the question of high wage rates, highly protected employment in the developed countries of the world compared with open competition and free trade with less developed and Third World economies. If we are to seriously compete with Third World economies we cannot continue to treat our own labour markets and employment relationships as if the impositions, protections and regulations applying to them have no implications for whether work is located in Europe generally, in Ireland, in particular, or for instance in Morocco, the Philippines, Japan and other places.

Some people like to believe we can make these decisions and implement directives from Brussels without regard to their implications. Water does not flow uphill and in terms of the law of gravity in economics, jobs will flow from high employment cost economies to low employment cost economies. That applies to Ireland and, particularly in the light of the recent ceasefire, to the Republic and Northern Ireland. Only a fool would open a factory in the Republic if the same grant package were available to open it a few miles north of the Border because the wage bill of an employer employing people of the same calibre and character north of the Border will be substantially lower than the wage bill south of the Border. We cannot defy the laws of gravity in this way. The same will apply to the decision to build a factory in Monaghan, Deputy O'Hanlon's constituency, or in south Armagh. With PRSI and PAYE it will cost much more to give an employee £1 to take home in Deputy O'Hanlon's constituency than it will a few miles to the north.

We cannot afford to ignore the economic implications of such differences and just as Europe as a whole cannot maintain a high cost employment regime, Ireland cannot afford to tax work to the extent we have, but the Government does not seem to appreciate that fact. This is the Government which, for one terrible year, continued the infamous income levy and whose Minister for Finance. Deputy Bertie Ahern, resisted its removal until the trade unions twisted his arm. That is the attitude of this Government to the tax wedge, to employment taxes and to the employment market, that they can tinker with the economic prospects of employment without regard to the real economic effects. The day of reckoning is coming. Our society can no longer sustain 300,000 people on the margins, or sustain human set-aside at that level and must now face up to why the economy is failing in the employment market to the extent that it is.

Deputy Gilmore spoke about neutrality and referred to the emergence in Europe of a new zenophobic right. I agree that a deeply disturbing feature of European politics today is that a political element hostile to the European Union and to foreigners seems to be enjoying electoral success. Does Deputy Gilmore not remember, however, that the chief breeding ground of such political movements is unemployment and economic failure? What response will there be to that? Will there be more of MEP Pádraig Flynn's social paternalism or will there be a radical approach to putting Europe on the right track towards a full employment, booming economy?

In political debate on this subject, everybody here seems to subscribe without thought to the notion of European federalism. Deputy Gilmore referred to the creation of a European homeland and presumably a political structure to administer it. The time has come for us to reopen the whole issue of federalism and where it is going. Do we want a single Government in Europe? What powers do we want it to exercise? Do we want a single legal system? What powers are we willing to surrender to such a central organisation? Are the decisions to be made by central European institutions likely on balance to be favourable or hostile to Ireland's vital interests as the expansion of the European Union continues apace?

I pose those questions because the political establishment has got away with murder in terms of failing to face up to the real issues now confronting Ireland as an economy and as a political entity. Our political establishment has prated on about being pro-European while holding out the begging bowl and without realising that we must make fundamental decisions about our country.

The time has long gone for people to simply say we are more communitaire, more federalist and committed to an ever closer Union, whatever that means. We must abandon that facile and thoughtless approach to Europe and replace it with one based on our vital interests. I salute the member states who look to their own interests and I am ashamed to say that Ireland has conceived its vital interest in Europe as simply the extent to which the begging bowl is filled at any given point. That era is long gone from 1996 onward, in the context of expansion in particular, we will have to face up to the harsher realities and start looking after ourselves because we are in a big boys' game now and those who think that by making generally pro-European noises they will look after their own basic interests will be radically disappointed as the European expansion and deepending process gathers pace.

Dr. O'Hanlon

I listened carefully to Deputy McDowell who dealt at length with the domestic economy. Indeed, all the questions he raised could be answered in a debate on our economy. I appreciate his concern for my constituency but as the Acting Chairman, Deputy Kirk, and I know well, our constituency has competed with the best of them in the bad and good times and will continue to do so, particularly in the food sector.

Mr. M. McDowell

I wish the Deputy well.

Dr. O'Hanlon

We are debating the European Communities (Amendment) Bill and the report from the Joint Committee on Foreign Affairs on the enlargement of the European Community. The Bill is a technical one to provide for the Treaty of Accession of Austria, Sweden, Finland and Norway to become part of our domestic law. I sincerely congratulate the people of Austria and Finland for the very positive vote in their respective referenda on their applications to become full members of the European Union. I have no doubt those positive results will provide a real incentive for Sweden and Norway to vote strongly in favour of joining the EU. A successful conclusion to those referenda will complete the cycle which began with the 1960 European Free Trade Association, EFTA, followed by the European Economic Agreement in 1992 and the negotiations on the present enlargement in 1993 and up to recently.

Along with other Members present I pay tribute to our Joint Committee on Foreign Affairs for producing a succinct and timeley report on the enlargement of the European Union. It is unfortunate that the committee's chairman, Deputy Lenihan is indisposed today as he was instrumental in identifying this topic as one for priority review by the committee. He would have brought his wide experience to bear on the many policy issues involved.

The committee was ably assisted in its review by Professor Brigid Laffan of University College Dublin who was retained as a consultant in the preparation of the report. Professor Laffan assessed the latest information on European Union development and interviewed key personnel in Ireland and in the member states. I thank also the Tánaiste and the Minister of State for European Affairs, Deputy Tom Kitt, who is here today and thank the Secretary of the Department of Foreign Affairs, Mr. Noel Dorr, his Assistant Secretaries, Mr. Ted Barrington and Mr. Noel Fahy and other officials who were very helpful throughout our review. The deliberations of the joint committee were very much enhanced by contributions from the Institute of European Affairs headed by Mr. Brendan Halligan as well as the Ambassadors and parliamentary delegations from a number of applicant countries.

The joint committee's report sets out the background to the proposed enlargement of the European Union. The increase in the Union from 12 to 16 members will be greatly beneficial to Europe as a whole and it will help strengthen the union in the future. The joint committee also considered in detail the further enlargement of the European Union with reference to central and eastern Europe as well as a number of Mediterranean states. I will deal with that in more detail later.

Assessment of central and eastern enlargement in particular requires a focus on its timing, institutional consequences and policy implications. The nature and extent of the transition process in Central and Eastern Europe will have a bearing on enlargement. The joint committee notes that Central and Eastern enlargement will have implications for the Common Agricultural Policy, cohesion policy and EU public finances. Ireland will have a lively and continuing interest in developments on these fronts. The joint committee emphasises that the present phase on enlargement of the union should be seen as a natural evolution of the Union as a whole.

Ireland has been a committed and responsible member from the outset and in that context the joint committee emphasises that the way forward is via a united approach along a single path. Any suggestion of a two-speed policy would not only be ultimately divisive but highly undesirable in this stage of the development of the Union.

The report is laid out in a logical sequence and for ease of reference the main issues are contained in individual chapters, for example, the candidate countries, the EFTA enlargement, the negotiations, the countries of the East, the Mediterranean and the choices facing the existing member states. The committee's conclusions and recommendations are contained in Chapters 9 and 10 and these summarise succinctly the issues which will impact on the EU as a result of further enlargement.

The report does not deal in great detail with EU security and defence issues which are of fundamental importance. They will be the subject of a specific report by the joint committee and a preliminary examination of these matters is underway. We expect that report to be completed before the end of the year. It will be a response to the Tánaiste's invitation to the joint committee to provide its considered views in the lead up to the Government's White Paper on foreign policy.

The third chapter of the report details the ten candidate countries which have formally applied to join the Union since 1987. The longest standing application is the Turkish one which dates from 1987 followed by Austria, Cyprus, Malta, Sweden, Finland, Switzerland, Norway, Hungary and Poland. As the House will be aware, Switzerland has decided not to proceed with its application at present. From the original membership of six states in 1987 to the present 12 the EU will now increase to 16 and ultimately to 20 or 25 states. The implications of such enlargement are enormous and challenging and Ireland's future role and influence must be addressed and analysed clearly in the months ahead. This debate provides an excellent opportunity to inform the public of current and potential developments. That is one of the best means of improving public awareness in a down to earth and transparent manner. The media has a responsibility in this area and I am confident that national and local radio, television and print media will play their part in keeping people fully informed of developments in Europe.

The Minister of State for European Affairs chairs a co-ordinating committee of senior officials concerned with European affairs. A recent meeting of our sub-committee on European Community legislation was informed that the co-ordinating committee will report shortly and bring forward practical recommendations for improving public awareness of the EU in a user friendly manner. The Joint Committee on Foreign Affairs warmly welcomes and supports this development.

The applications for EU membership by Austria, Finland, Norway and Sweden are a source of interest and a challenge to Europe. We know the EFTA countries had close links with the EU since the early 1960s and further development into the European economic area offered a partnership to those states which were just short of full membership. It allowed them to participate in the Single Market without full membership. In economic terms, EFTA states are integrated into the EU almost as much as the member states themselves.

The EEA concluded in 1992 was seen as a transitional arrangement on the road to full membership. About two-thirds of the acquis communitaire is already incorporated into the national laws of the EFTA states covering such areas as the free movement of goods, services, capital and persons. The process further evolved following the decision of the four countries to apply for full membership. The House will be aware that accession of the EFTA states to the EU poses least problems of adjustment. They are highly industrialised, technologically advanced and wealthy liberal democracies whose standards of living equate to the richer states in the Union. We are aware that the Scandinavian states find it increasingly difficult to maintain high employment and a large public sector. This experience is familiar to many member states. Joint action will ensure that these serious issues will figure high on the agenda of the EU institutions in the years ahead.

The fifth chapter of the report sets out the background to the negotiations on the applications of the four states. Policy issues are spelled out and specific problems and potential readjustments analysed. One of the significant features of the current round of applications is that the EFTA states will be net contributors to the Union budget. This is widely seen as one of the attractions of enlargement. For many reasons we very much welcome the accession of Austria, Finland, Norway and Sweden to the EU. We could spend much time discussing the fact that Ireland has much in common with Norway, not only historically and culturally but in terms of the potential for a natural development of increased commercial and trading possibilities. This issue could be pursued in greater detail when their membership is formalised.

As regards a common foreign and security policy, traditionally Austrian, Finnish and Swedish neutrality was seen as a major impediment to membership of the EU. However, this is generally no longer the case particularly following the collapse of communism in 1989. Pillar two of the EU Treaty dealing with a common foreign and security policy will be a central feature of the intergovernmental conference in 1996. In the meantime, the key issues involved will be the subject of public debate not only in the applicant states but in Ireland where the question of the future policy on security and defence is a matter of significant interest. The enlargement of the EU will have considerable implications for EU institutions and a shift in representation will be of major interest to Ireland.

After the current round of applications the next probable progression will be consideration of applications by the states in Central and Eastern Europe. For many of those countries membership of the EU is their key foreign policy goal. Since 1989 the countries of Eastern and Central Europe have sought to enhance their relationship with joint Western European organisations such as the Council of Europe, NATO and the EU. Their long-term objective is to be fully integrated into these organisations for political, economic and security reasons. Since 1989, the EU has been evolving a response, both politically and in terms of programmes, to events in the East. Clearly stabilising the process of change and stabilising democracy is in our interests. With that in mind the EU has been developing and strengthening a web of links that join the EU with those states. That approach includes extensive programmes of aid for countries such as Poland and Hungary which were in the vanguard of the reform movement.

Three types of relationship evolved: first, European agreements with Poland, Hungary, the Czech and Slovak Republics, Bulgaria and Romania; second, trade and co-operation agreements with the Baltic states and, third, co-operation agreements with the Commonwealth of Independent States of the former Soviet Union. The issues raised by Central and East European enlargement will be much more challenging than those found by the EFTA enlargement. Many uncertainties still have to be overcome, not least the process of transformation of these countries which must have viable democratic systems and capable of harmonising their laws and systems in an EU model. Accession of the states of Central and Eastern Europe will add significantly to the population of the Union, which will increase by more than 100 million. It should be borne in mind that the income level of those states is well below that of the European Union.

Having dealt with the accession of Central and East European states, it is appropriate to point out that Turkey, Malta and Cyprus have also applied to join the European Union. While this additional enlargement is further down the road it is as well for us to be aware of its potential impact. The enlargement of the Union will give rise to new challenges and radical institutional changes, which are set out in Chapter 8 of the report. The report sets out various models for institutional change and these will no doubt be the subject of much discussion during the months and years ahead. Of particular interest to Ireland will be the size of, and representation on, the Commission and the best way to adopt the system of qualified majority voting so that smaller members states are not put at a disadvantage.

The joint committee sets out its conclusions and recommendations in Chapters 9 and 10. It supports the continuation of the enlargement process and endorses the present phased approach to enlargement through negotiation with groups from European states at a similar stage of development. While endorsing the broad criteria for membership agreed at the Copenhagen European Council, the joint committee recommends that an additional criterion and precondition for entry to the European Union must be respect for human rights. It also welcomes strengthening the social dimension of the European Union arising from enlargement. However, it equally recognises that the policy implications for Irish domestic and foreign policy of enlargement of the Union to the East need to be fully debated. A balance must be struck between the interests of the applicants and the need to ensure a functioning and effective Union. The institutional issues raised by further enlargement are central to the development of the Union.

The joint committee recommends that Ireland should play a leading role in elaborating and ensuring the adoption of appropriate and effective mechanisms to protect the unique contribution of smaller member states. Contact and co-operation with other small member states would be beneficial for Ireland. An enlarged European Union presents many new political and economic challenges for Ireland and I have no doubt that, collectively, we can respond to the new and evolving situation. The report is a very useful source document and I recommend that its contents be studied, not only by Members of the Oireachtas, but also by the public. I am convinced that citizens, young and old, will benefit from enlargement of the Union and that our individual and collective commitment will ensure that Ireland can continue to play a significant role in the development of the Union in the years ahead.

Mr. Connor

I am glad of the opportunity to contribute to this timely debate. I use the word "timely" because it occurs at the same time as the campaign to join the Union in the EFTA countries — it has been successfully completed in two countries and we have to await the outcome in the other two.

I wish to pay tribute to the chairperson of the Joint Committee on Foreign Affairs, Deputy Brian Lenihan, who, unfortunately, is unable to be with us today, for spearheading this report and to Professor Bridget Laffan and the other people who attended the committee. I attended almost all meetings of the committee and subcommittee at which the preparation of the report was discussed. The report proves the value of the committee system.

I also wish to pay tribute to the newly appointed chairperson of the subcommittee of the joint committee, Deputy O'Hanlon. This subcommittee has taken on the work and role of the committee which dealt with the secondary legislation of the then European Community. The role of the subcommittee has not yet been properly defined — it is certainly not as wide as the one enjoyed by the previous committee — and given the importance of the issues with which it deals, I appeal for it to be given as wide a role as possible and the wherewithal in terms of back-up, staff etc., to ensure that it does a good job. There has been a poor response to the requests by committees for professional staff, etc. Yesterday a new clerk was appointed to the subcommittee but this is not enough. Given the importance of the issues with which we deal the necessary back-up staff and expertise should be put in place. It is very important that committees which discuss issues on behalf of the public should have proper back-up, it is money very well invested.

I wish to pay tribute to the architect of the developments we are discussing today, the EU President Jaques Delors. He became President of the EU in the mid 1980s when the Community was, to say the least, a shambles. Some may regard that as extreme language but I do not think so. Much had been achieved since the foundation of the then Community in 1958 but by 1984-85 it had, by and large, lost its way. Jaques Delors brought a new vision and drive to the Community and put in place the mechanisms for the Single European Act, which he saw through to its conclusion. There was opposition to this revision of the Treaty and much hard work had to go into it, but he had the vision and intellectual drive to see it through to its conclusion.

Above all, he rose magnificently to the challenges posed to the Community by the changes in Eastern Europe by putting in place a programme to enlarge the Community through the inclusion of the EFTA countries and, after that, the East European countries, the broader European family. He ensured that the proper mechanisms would be put in place and that the then Community would show its generosity to the countries of Eastern Europe which, as someone said, were under an anaesthetic for approximately 50 years following World War II and were part of the hostile confrontation between East and West. Jaques Delors had the drive and intellect to see through the problems and realise what needed to be done in regard to Eastern Europe. He ensured that the old hostilities were cast aside, that the economies of these countries would be assisted to make the necessary adjustments to meet the criteria for membership of the new European Union. I sincerely hope that in the next decade countries such as Hungary and Poland — the immediate applicants — Slovenia, Romania and Bulgaria will be members of the European Union. Regardless of the final outcome in the former Yugoslavia I hope there will be sufficient stability in the states which will emerge so that they can be accommodated as part of the European Union.

That is the idealistic part that attends this whole debate about expanding the European Union but behind it there is a different reality. There is an enormous sense of alienation among the populations of the various states who wish to become members. If I were asked the probable outcome of the referendum in Norway, I would say they would vote against it. In Finland, public opinion polls showed that the vote in favour would be much greater than it turned out to be. There were 10 per cent fewer people in favour than the opinion polls suggested. In Austria a similar situation arose. The vote in favour was not as large as anticipated. The problems in Norway in relation to its fisheries and regional policy are real. We must bear in mind these sensitive issues that arose during the negotiations with the EFTA group of nations, most of which would coincide with issues here. Page 16 of the report shows that of three main sensitive issues identified in each of the four applicant countries agriculture was first. In three of those countries, Sweden, Finland and Norway, the issue of regional policy was either second or third. In Norway fisheries was the second most sensitive issue which they had to deal with.

Agriculture is the economic cornerstone of the European Union. So far as we are concerned it is still the greatest single item on which the European Union spends its money. We find, and the report sets it out, that support for agriculture in Austria, a net percentage PSE, is 56 per cent whereas the EU average is 48 per cent; in Sweden, 61 per cent; in Finland, 70 per cent; and in Norway, 78 per cent. That is something we forget when we speak about the large measure of agricultural support which the European Union gives and which Ireland, above all other member states, currently enjoys to a great extent. We forget the great level of support for agriculture in the EFTA applicant states, which is way ahead of what we receive and far above the EU average. It is little wonder there is no great incentive among the rural communities in these countries to join the EU. They have to adjust their prices downwards to become more sensitive to what the real market will give for these commodities. That is what we have been doing under the reform of the Common Agricultural Policy during the past three or four years. Procedures have been put in place whereby these countries can maintain close to these levels of support for a transitional period. Naturally people will look beyond the transitional period of five years and find that there will be a fall in incomes.

Regional policy matters are a major issue of concern among these applicant countries as in Ireland. Deputy Gilmore said the average income in Ireland was 70 per cent of the European average. I live in a peripheral county, County Roscommon, which 20 years ago was most enthusiastic about our membership of the European Community. To the west lie the counties of Mayo, Galway, Sligo etc. The greatest support for joining the old Common Market, in the 1972 referendum, was in those constituencies. That support has gradually eroded because the promised cohesion and solidarity failed to materialise. Cohesion meant the transferring of resources of the richer to the less well off to bring incomes more in line.

Although I support the European ideal it was manifest in the recent European elections when we had the lowest turn out ever that people feel alienated because the cohesion policy has not meant that the income gap has closed. In countries such as Roscommon and Mayo it is about 70 per cent of the national average or about 55 per cent of the Community average. We were told that these principles would eliminate the sense of marginalisation because one happened to live in a peripheral region. National governments and, in this instance, our Government have failed to implement a proper regional policy that gives a sense of belonging to people living in peripheral regions who have an income that is 55 per cent or 56 per cent of Community average. If the four new countries join the average will be higher and our relative position will be worsened.

I ask the Minister of State, who has his roots in the region to which I am referring, to ensure that the Government implements regional policies and policies of cohesion and solidarity that will close the gap between those regions here who are less well off, in comparison with the rest of the country but much less well off than the average in the European Union. This is the same factor that is influencing voters in Norway and Sweden not to vote for this package because it does not represent any improvement in their present lot. I fully support the idea of a European Union which will prevent the outbreak of another world war or the dictatorships that existed in many parts of the Continent between 1914 and 1939 and which gave us people like Adolf Hitler. It is a great political ideal to build a Europe that is meaningful to its citizens. I support that ideal, but it is regrettable that only a minority of our people appear to do likewise. People tend to support an economic union which will put more money in their pockets and increase their living standards. The Minister of State is initiating a programme in communicating Europe to the people, an important initiative. The majority of my party who are acquis communitaire and pro-Europe would be disappointed if public opinion on Europe — which I perceive to be moving against participation in the Union — were further eroded.

We are a neutral country, although I do not fully understand what we mean by our neutrality. If Norway and Sweden vote "yes", we will be joined by three other neutral states. Austria, Finland and Sweden are neutral, but Norway is not as it is a member of NATO. I do not know what that will mean for what is called a "common defence". I will welcome the publication of the White Paper promised by the Tánaiste and Minister for Foreign Affairs, but in 1996 we will have to say exactly what we mean by our neutrality and participation in a common foreign policy. I have no doubt we will be supported by the three other member states who claim to be neutral.

It is interesting to examine the origins of those countries' neutrality, they appear to have a greater raison d'être than us in that regard to it. A report on the origins of neutrality and foreign policy in Austria, Sweden and Finland states that Austria's neutrality is based on a federal constitutional law dated 26 October 1955. That was part of an all-power agreement with Austria stipulating that following the Second World War Russian troops would withdraw from Austria to ensure that there was no threat to the then Soviet Union or the Eastern Bloc countries. For that reason Austria became neutral. It does not have any other historical claim to neutrality because it was part of the Austria-Hungary empire and aligned with Nazi Germany in the Second World War. Sweden's policy on neutraity dates back to the 19th century. It has a large army and during their visit here members of the Swedish Parliament and the Ambassador told the Joint Committee on Foreign Affairs they will continue to keep a large army. Its neutrality means non-participation in military alliance in times of peace to allow neutrality in times of war. That is a fairly Jesuitical and straightforward statement, but it could be interpreted in many ways.

The Finnish neutrality evolved from its relations with Russia, with whom it went to war in 1940 when Russia took over a large portion of its territory known as the Karelia region. For pragmatic reasons. Finland signed a treaty of friendship with the Soviet Union in 1948 which, as far as the Russians were concerned, had to include Finnish neutrality. In other words it was a buffer, but neutral state on the northern border of the Soviet Union. Finland had good reason to remain neutral.

At the intergovernmental conference in 1996 the question of a common defence and a common security and foreign policy must be addressed, the "neutrals" will have to come to the table. The other three countries which are neutral have been more specific than us in terms of their contribution to a common security and defence policy.

We must be specific in terms of our neutrality and what it means for our participation in a common security and foreign policy of the European Union, a union we embrace lovingly and longingly on many other issues. The Government must tell us, in clear specific language, what our policy on neutrality means.

Mr. Ferris

I wish to share my time with Deputy Gallagher.

An Leas-Cheann Comhairle

Is that agreed? Agreed.

Mr. Ferris

We welcome the Bill presented to the House by the Minister of State, Deputy Kitt, which will permit Ireland to ratify the Treaty of Accession signed since 24 June last. Its signing conferred on us an obligation to enact legislation to allow amendment of the Treaty. The provisions of the Bill will not be enforced until a date set by the Minister which, I hope, will coincide with the positive acceptance of all four applicants. From a legislative point of view, we will be in a position, not alone to ratify and extend the Treaty to include those applicants, but also to welcome them.

The Joint Committee on Foreign Affairs, under the guidance of Professor Laffan and the chairman, Deputy Lenihan, prepared this excellent report and I concur with the tributes of other Members in that regard. The committee has been involved in elaborate negotiation and consultation with the parties involved in the enlargement of the European Union, particularly with representatives of the applicant countries who are members of the diplomatic corp here. We have benefited from their input, but it must be recognised that their accession to the European Union will benefit the Community economically. Those countries support their agricultural sectors to a much greater extent than the EU supports agriculture in its 12 member states. We have always argued for the best possible EU support for agriculture because of its importance to our economy. In the debate on Maastricht, the reform of the Common Agricultural Policy and the GATT negotiations, advocates in Europe claimed we should receive a much lower budget. As a small nation on the periphery of Europe we were accused of going to Europe with a begging bowl mentality, but we now realise that the new applicant states support their agricultural enterprises to a much greater extent than that which we enjoyed since joining the Community. That confirms the importance of the entry of these countries to Europe because they will improve the overall budget benefiting smaller nations like ours. It will also bring on board people from small nations with many similarities to Ireland. Not least important is the fact that the majority are neutral nations, a point taken up by Deputy Connor. The Labour Party, in particular, welcome the fact that henceforth four of our allies will be neutral and non-aligned within the context of NATO and the other military blocs, a welcome change. Indeed the Minister in his introductory remarks pointed out that these four applicant countries accept the obligations placed on them by the existing European Union, that is their attitude to foreign policy, defence and security. Therefore, they are entering the union with open minds, knowing their responsibilities.

We are also aware of our responsibilities. I know there is a major debate which I hope will accelerate up to and including 1996 when decisions will have to be taken on clarification of our role. I know that the Tánaiste and Minister for Foreign Affairs promised a White Paper on the subject which will afford an opportunity for widespread debate in this overall area, focusing the attention and minds of our people on our future role within Europe and our role in adding to the culture and improvement of quality of life of our people.

I have no doubt that between now and 1996 there will not be ambiguity but active debate. In that respect I commend the Minister of State who chairs this co-ordinating committee with the object of informing the people about Europe because there has been a real lack of knowledge in that regard and how it affects our daily lives. We must recognise that it affects all of us, our economies and our constituencies. Therefore, it is important to create a forum for dialogue and dissemination of information at all levels, to the European Parliament, the Council, the Commission and the new regional and local authorities, all of whom are applicants and beneficiaries of European funds made under procedures often faulted by many of us for their lack of transparency when applying for Structural and-or Cohesion funds.

Our report deals with many matters in a specific way. For example, it deals at some length with application procedures, the conditions laid down for membership and lists a whole range of important recommendations. As said by Deputy O'Hanlon, chairman of the European Union subcommittee, it boils down to the fact that we do not want a two-speed Europe, we want Europe to proceed as a united group.

That takes me to the matter of the United Kingdom opting out of its responsibilities under the Social Chapter which, obviously, has created some problem for the Progressive Democrates. While not wanting to introduce a discordant note, I might remind Deputy Michael McDowell that the Progressive Democrats were in Government at a time when they knew Ireland was supporting the concept of the Social Chapter. The members of the Labour Party make no apology for actively supporting that stance and advocating its full adoption by all members states including the United Kingdom. We do not want our workers here to be second-class citizens in Europe vis-á-vis their rates of pay, social security benefits, or the necessary contributions to ensure that there are social benefits for the sick, old, incapacitated or those out of work through no fault of theirs. Somebody must be responsible and those at work will always share that responsibility. It must be remembered that employers have the same responsibility. Even when we removed the requirement of employers to pay PRSI contributions for low-paid workers, in spite of the Thatcherite attitude of the Progressive Democrats to this aspect of the Social Chapter, it did not create additional jobs. It will be confirmed by my colleague, Deputy Gallagher, that the new applicant countries have much to contribute, that we have much to learn from them and their attitude to the treatment of people, the rights of women, to work and other rights and aspects of society. That is why — and the Minister will confirm this — that even in Sweden at present women have reservations about joining the European Union believing they will lower their standards.

We have improved ourselves generally resulting from our membership of the European Community and should offer no apology to the Progressive Democrats or any other group for supporting the Social Chapter. My colleague, Deputy Gallagher, will develop those points. I commend the Bill, support the recommendations contained in this report and commend all those who have been involved in its preparation.

Mr. Gallagher

(Laoighis-Offaly): I welcome the opportunity to contribute to this timely debate given that we are considering a number of matters relating to the European Union, not least the possible accession of four new member states, together with the report of the Joint Committee on Foreign Affairs. We should have such debates more frequently. There has been much talk of democratic deficit, the need for informing our people more comprehensively about Europe. Sometimes we do not appear to inform ourselves sufficiently even within this House. For that reason I very much welcome that considerable time today is being devoted to this subject.

I also very much welcome the prospect of Sweden, Norway, Finland and Austria joining the European Union, for a number of reasons. I am glad that already the electorates of Austria and Finland have voted in favour of entry. I hope that the electorates of the other two, Sweden and Norway having considered the pros and cons, will decide that their best future interests lie within the European Union because it is my firm belief that our best interests lie in their becoming members.

The fact that three of the four new applicants are neutral countries was referred to by previous speakers. Not only would it secure for us a group of allies among neutral states within the European Union, it would force us to develop and elaborate a coherent statement of our policy on security, defence and neutrality in preparatiom for the Intergovernmental Conference in 1996. For too long we have been able to hide under the umbrella of our larger neighbours and friends without working out our defence policy.

As others said, in the discussions the Joint Committee on Foreign Affairs had with applicant countries in the course of its preparation of this report, I was very much struck by the ease with which they could articulate and defend their policies. I hope that the publication of the White Paper on foreign affairs will help us in that regard.

The other two areas within which we can learn from applicant countries are social policy and environmental policy. The Scandinavian countries, in particular, over a long number of years have adopted a policy of partnership between the different social partners, thereby managing to progress their countries and peoples in a steady, measured but determined fashion. While they are now being forced to rethink many of their principles and strategies in this area an examination of their policies makes it clear there is no great division on the question of social partnership. For that reason I was sorry to hear Deputy Michael McDowell introduce a discordant note into this debate on the matter of social policy. The Social Chapter of which he spoke constitutes a minimalist section, setting out minimum standards to be achieved for people at work. It has deficiencies in that it does not go far enough and excludes people, not in the workplace. However, it represents some statement of social policy by the European Union. The concern of many applicant countries was that it did not go far enough, fearing that their achievements could be threatened by the fact that the highest standards expected from the existing Euro Twelve was considerably lower than theirs. That was a concern of women in Scandinavian countries, especially in Sweden. The type of low wage-low skill economy the British Government is seeking to promote, having opted out of the Social Chapter is similar to many recent developments in the United States. Today, Deputy McDowell held them before us as a model to which we should aspire. We should aspire to a model which moves us forward rather than backward. I do not accept his assertion that the Government is unconcerned about or not tackling the problem of long term unemployment. If that is his genuine belief it shows he has not given much attention to the debates in the House during the past year.

The Government has taken many initiatives in this area. Specific budgetary measures were introduced this year, which I hope will be built on, to tackle elements of the poverty trap. Social welfare schemes were introduced to encourage people to return to work. A major report of the NESC published during the summer specifically recommended measures to seriously tackle long term unemployment. Those recommendations are being considered by an interdepartmental Government task force with a view to their early implementation. While Deputy McDowell's views on the Social Chapter may make interesting reading in the columns of certain Sunday newspapers they do not contribute to this debate or the interests of Ireland within an enlarged European Union.

Recently Austria, Sweden and to a lesser extent Finland have done much work in environmental areas. Although affected by different environmental concerns those countries have developed environmental standards similar to those to which we aspire. We recognise the importance of good environmental standards in the production, marketing and distribution of our products. Countries, like Sweden and Austria have adopted fairly stringent environmental controls to protect the welfare of their citizens. They were concerned that European environmental standards would not be as stringent as those which apply in their countries, but have been assured in that regard. I look forward to those countries being a positive force in the improvement of environmental standards in the European Union.

The accession of new states to the European Union will assist Ireland in terms of the balance of power in the European Union and European Council. To date debates in the Council have tended to be dominated by the larger countries, such as Britain, Germany, Italy, France and Spain. It would greatly benefit us to be able to ally ourselves to a relatively large number of medium sized states. For too long we have had to hitch our wagon to one or other of the larger powers and hope that the result turned out for the best. I hope prospective allies among the new states will enable diplomacy to work more effectively.

Participating in this type of debate and having taken part in debates of the Joint Committee on Foreign Affairs in respect of European enlargement during the past few months, I am aware of a gulf between an inner circle familiar with this type of debate, the jargon and the issues and the public who are encouraged or discouraged to support the European Union, mainly on financial grounds. In the communicating Europe initiative will the Minister try to involve people at local level? He should consider working with the local authorities in this regard. As the Minister is aware the deliberations of local authorities receive wide publicity through the local media. Last year in my council in County Offaly there was an interesting public meeting and an exchange of views with MEPs in the Leinster constituency. I was surprised by the number of people who, having read about the issues in local newspapers or having heard them on the radio, were willing to express views. A number of them attended European Union meetings held prior to the European elections this year. That type of activity at local level should be encouraged.

Motions and Bills need to be introduced and considered in the House, but unless local people are involved debates in this House will not serve us well in the long term. Members who advocate European Union should not be afraid of negative views raised in the context of such debate. For too long we have tried to portray European Union only in terms of providing benefits without acknowledging and seriously addressing the concerns of people who hold a contrary view. In a fair debate if a case is sufficiently strong it can be won.

On the process which lead us to this debate today the time and resources needed to research this subject and to present reports are considerable. I welcome the assistance of the Minister, and his colleagues in Government in securing additional resources for the Joint Committee on Foreign Affairs in terms of staffing, consultancy services and so on, to facilitate this type of debate, the presentation of a report and the dissemination of the details outside the House. In the long run such measures can only be to our benefit. Go raibh maith agat.

Mr. Deasy

I welcome the opportunity to discuss the Bill. No party or Member objects to the proposed membership of the European Union of the four countries concerned. The Minister referred to the impending membership of a number of countries from Eastern and Central Europe. I stated previously during Question Time and debates that we need to discuss the other applications for membership of the European Union because they would have major implications for us. The Tánaiste and Minister for Foreign Affairs is aware of my views on the matter. We need a question and answer session, rather than a debate on the matter. Points can be raised in a debate which may not be answered in a Minister's reply. The implications of an enlarged membership of the European Union are so important that we must tease out the problems that most likely will arise for this country. Countries, such as Poland, with a population of 40 million people and a run down economy, Hungary, which has a slightly better economy and a smaller population and Turkey, with a very large population and enormous infrastructural problems, would put a financial strain on the Community's resources which could be shattering and would impinge seriously on our income from the Union. We have not even begun to discuss these matters in any depth.

I am a member of the Council of Europe which currently has 32 members. At least 29 of those have indicated a serious wish to join the European Union. We were six. We increased to nine in 1973. In 1980 we increased to ten with the accession of Greece. Years later we increased to 12 with the accession of Portugal and Spain. Now we are to increase to 16, if the referenda being held in Norway and Sweden are in favour of joining the European Union. Those four countries will have little or no impact on the European Union budget; they will give as much as they take. That reduces the significance of this Bill, although we have to go through the motions in regard to it.

However, when it comes to the applications of those other countries we will really need a type of information that has not, as yet, been forthcoming. Look at the drain that the reunification of Germany placed upon the resources of what is by far the richest country in the European Union. Taking in East Germany, with fewer than 20 million people, created a very serious financial problem. Taking in more than 100 million people is bound to seriously disrupt cash flow within the Community. I have been to countries like Poland, which is one of the applicants. To bring their standard of living level with ours, which is about the average in the European Union, we are talking not millions or billions but trillions of pounds. Likewise in regard to Turkey, the longest standing applicant for membership of the EU. There will be no further Structural Funds for Ireland, no Cohesion Funds, no compensatory payments to farmers in the form of headage payments, premiums or subsidies. How could there be when the money will be needed to give people in those countries a satisfactory standard of living? It is not possible to accommodate all those people without reducing the standard of living of people who are at present quite well off.

We in this country have yet to face up to that fact. We would rather pretend this is not going to happen but it will. The Germans have clearly indicated that they are very much in favour of Poland joining the European Union and Poland and Hungary are actively pursuing full membership. There is a clear reason why the Germans want the Poles; they want Poland as a buffer zone between themselves and Russia. This might seem like scaremongering but the elementary fact is that the Germans still dread the thought of Russians pouring in their millions into Western Europe.

The present instability in Russia cannot be overstated. Its prime minister, this very day, is under a cloud. The rouble almost collapsed last week. We read daily about the Russian mafia, gangsterism and corruption at the highest level. Russia still has a standing army of millions of men and women. It still has the weapons, the armaments of destruction and war. How long can that state exist without some serious uprising? How long will it remain a democracy? When Mr. Zhirinovsky was elected to the Russian Parliament last year he had a significant following and his stated political intentions included taking over the former Russian possessions or territories in Eastern Europe, Poland, Finland and the rest. These, he said, are Russian colonies belonging to Russia, the greater Soviet Union. There are some very frightening aspects here which we need to go into. Apart from the economic implications, there is political instability. People are hungry but well armed.

One cannot take it for granted that things will stay as they have been. Things never stay the same. There will always be change. This nice cosy club of 12 which will shortly be 16 — and I do not object to that — may find itself seriously disrupted before the end of this decade, which is only a little over five years away. Austria and Finland have already voted to join the European Union and there will shortly be referenda in Sweden and Norway. A disturbing fact is that in the general election a month ago in Austria the Neo-Nazi Party got 22 per cent of the vote. When that percentage of people is voting for extremism and the resurrection of the Nazi movement, we should be more than a little concerned. This same movement is to be seen, although it has not manifested itself in votes to the same extent, in the racial riots and murders which take place almost on a daily basis in Germany. That movement is increasing, and the Austrian vote was particularly frightening.

The Minister pointed to areas we have in common with the four new applicants. All the countries have a significant farming element. It was interesting that the Finnish farmers voted heavily against accession because they have financial aids that are superior to the subventions and subsidies provided by the EU — that was educational to people in this country. Many people here did not know that other countries provided national aids; they believed that their farmers were unsubsidised. The Finnish vote was predictable, but it was not as great as the polls had indicated.

We have a special relationship with Norway in that we have a keen interest in fisheries. I am glad the Minister for the Marine was able to achieve 7.5 per cent of the cod catch in Norwegian waters. That is significant because it is the main species of fish caught. The big winner in terms of fisheries has been Spain which got away with blue murder in negotiations in the past ten years, during its accession negotiations and even up to recent months. It remains to be seen whether the Norwegians and Swedes will join the European Union.

The Minister said that we share a similarity of outlook with Sweden on international issues. I presume that means we have similar views on neutrality. I wish to make my position clear on the issue of neutrality. I believe it is a lot of bunkum. It is about time we in Ireland stopped evading our responsibility. In what context are we neutral? Since we get considerable financial benefits from Europe we have a duty to partake in every activity within the European Union and if that involves us partaking in a European army, so be it.

I was never proud — some people glory in it — of our neutrality during World War II. It was a cop-out. Have people in this country any remorse or conscience when they think of the millions of Jews, French and other Europeans who were massacred, gassed, hanged and tortured to death in concentration camps? We should face up to our responsibilities and take the broader view in Europe. We are part of Europe so let us be part of it in every aspect, whether in monetary gain or military involvement. That is one issue we have in common with Sweden, but it is no big deal.

If there is an uprising in Central and Eastern Europe, with people dissatisfied because their living standards dropped due to the collapse of Communism and the fact that they lost their basic income and foodstuffs, if there is an upsurge in Nationalism and the Zhirinovskys and Nazis in Austria and Germany get their way, there will be upheavals and we will have to protect ourselves, but the Irish should protect everybody else as well as ourselves. We should not be cowardly.

The former Workers' Party, now Democratic Left, used to say "No way will we surrender or give up our neutrality". However the game has changed in the last four years. Their allies in Russia are now their enemies and in recent times they have not had a good word to say about Russia. I do not know what their ideological hang-up is now because there is no Cold War, there is no East-West conflict and there is no Soviet Union versus the American empires. That is all over and done with. We are part of Europe and we should face up to our responsibilities in every area, including the military area. We constantly have the begging bowl attitude in Europe. We take everything but are not prepared to give anything back and that is not good enough.

I look forward to the entry of these four countries to the European Union. I look forward to debate and to question and answer sessions in this House about other countries who wish to join. They will have a major impact on living standards here but that does not mean we should oppose them. We will have to suffer but we should be prepared to do so. We should advise people that when the present Structural and Cohesion Funds have expired in 1998 or 1999, when there are no more direct payments to farmers, we will have a lower standard of living. Those moneys will be diverted to the new members from Central and Eastern Europe. Nobody has faced up to that fact and the sooner we do so the better.

Mr. Gallagher

(Donegal South-West): Tá an-áthas orm an deis seo a fháil chun cúpla focal a rá maidir leis an Eoraip agus go háirithe maidir le méadú an Aontais Eorpaigh. Glacaim an seans seo chun mo bhuíochas a chur in iúil don Chomhchoiste um Ghnóthaí Eachtracha a d'ullmhaigh an tuarascáil seo, tuarascáil atá fíor-thábhachtach agus tá anobair curtha isteach inti.

The proposed enlargement of the European Union offers many benefits and opportunities to Ireland as a permanent member of the European Union. As we are aware, following referenda on this issue, Austria and Finland have agreed to join the European Union. A referendum will be held in Sweden in November and in Norway before the end of the year. It is likely that Sweden will endorse the accession accords while the outcome of the referendum in Norway hangs in the balance.

On 1 January next Ireland will be a member of a Union of either 15 or 16 states. This will mark a new beginning for the European Union. In making adjustments of the pool of potential new members the EFTA states will present the least number of problems. They are highly industrialised, technologically advanced and wealthy democracies where the standard of living equates with that in the richer states of the European Union. There is a strong business tradition in the Scandinavian states and Austria and this governs the relationship between the social partners and the state. Social democratic norms are deeply embedded in their societies.

The Scandinavian welfare system is one of the most generous in Europe and has been lauded and envied as a model for social and economic progress. Concern for sustainable development, evident in strong environmental standards, is also apparent in these societies. Women's rights, female participation in politics and the public sphere are more advanced than in most other European States. The EFTA states accord a special place to agriculture in their economic life and use agricultural and regional policies to protect the vast areas within their countries which are sparsely populated.

With regard to the European Union budget, the prospect that the EFTA states will be net contributors is one of the attractions of enlargement. I realise the important role the European Parliament plays in this regard. On Tuesday last the budgetary committees decided to recommend unanimously to the Parliament that its contribution in 1995 to the International Fund for Ireland should be increased from £16 million, recommended by President Delors, to £40 million. I am confident that this recommendation will be adopted when the Parliament meets in Strasbourg next week.

The President of the Parliament has committed it to assisting the peace process in every way possible. Like the President of the Commission, he has said that European institutions will play an important role and respond positively. I am confident that the Parliament will approve the allocation of £40 million and that this will be ratified by the Council of Ministers. Like the Members of this House and of the European Parliament. I would be more than surprised if the Council of Ministers decides to reject this recommendation or reduce the size of the allocation.

This debate presents me with an opportunity, as a representative of a Border constituency in this House and as a representative of the Connacht-Ulster constituency in the European Parliament, to pay tribute to the European Union, the United Kingdom, the United States, Canada, New Zealand and Australia for making contributions to the International Fund for Ireland during the years. This is an important fund, not only for Northern Ireland but for the Border counties and it has played an important role in maintaining and creating much needed employment in that region which has been badly affected by the troubles during the past 25 years. This debate also presents me with an opportunity to pay tribute to the chairman, directors and chief executive of the fund who have done trojan work during the years and who are totally committed to the peace process. I welcome the proposed increase of £28 million, from £12 million to £40 million; it was not sufficient but it is a sign that the European Union is committed to the process of peace and reconciliation.

It is important to note that a task force has been established within the European Union to examine the position in Northern Ireland and to establish how the Union can best assist this process. Apart from the International Fund for Ireland, £109 million is to be made available under the INTERREG programme which is of importance on both sides of the Border. There is a need for a massive funding programme to provide additional funding, not alone for Northern Ireland but for the Border counties, as one cannot differentiate between the two.

During the years many businesses on both sides of the Border have closed. I take this opportunity to call on the local authorities on both sides of the Border to prepare submissions to be presented to the task force within the European Union. I have no doubt that there will be liaison between Brussels, Dublin and Westminster but there is a need to ensure that sufficient funding is made available to raise the standard of living, provide job opportunities and tourist facilities in this region.

Under the European Economic Area Agreement which came into effect in January 1993 the EFTA states agreed to meet the cost of their participation in EU programmes and to provide structural assistance for the Union's poorer regions, the objective 1 countries. At the conclusion of the accession negotiations the budgetary issue was linked to the agricultural and regional policy issues. The Accession Agreement provides for the payment of compensation of £2.4 billion during the period 1995-98 and a further contribution to meet costs in adjusting to the Common Agriculture Policy. The cost of the special agri-budgetary commitments is approximately £3 billion.

Assuming that all four applicants join, the European Commission estimates that the net gain in terms of the European budget will be £5.2 billion during the period 1995-99. This is good news for the objective 1 countries and should be warmly welcomed as this country is a net beneficiary.

In regard to the common foreign and security policy it must be stressed that Austria, Sweden and Finland are neutral. Norway is the only one of the EFTA states which is a member of NATO. Neutrality is more than a mere element of security policy of these states. It symbolises a national identity, a foreign policy of orientation and a freedom from confrontation. Neutrality is an important value in the political culture of the peoples of Austria, Sweden and Finland as it is an important value of our own people. Within the intergovernmental conference which is being convened in 1996 to review European policies, the neutrality of these member states will be important in endeavours to formulate a common security policy for the European Union.

I believe that Ireland should forge an alliance with the EFTA states to guarantee that our common views on security alliances are taken on board at the next intergovernmental conference. Hopefully it will be possible to form a common European security pact with neutral countries such as Austria, Sweden, Finland, Denmark and ourselves all at the negotiating table.

I wish to focus on trade with the EFTA states, prospective members of the European Union. As an exporting nation we should endeavour to increase our market share of exported goods into these EFTA countries. An Bord Tráchtála should initiate marketing initiatives to facilitate this process. Knowing the work that it has done over the years I have no doubt it will set in train mechanisms to ensure that we avail fully of the free movement of goods and services. We must take advantage of this enlarged European market.

From the political and institutional point of view the membership of the European Commission will increase from 17 to 21 and the membership of the parliament itself will increase from 567 to in excess of 630 with the accession of the four countries. Undoubtedly, the incoming President of the Commission, Mr. Jacques Santer, will not want to allocate weak political portfolios to the four incoming countries and it is important that I dwell on this point. If strong political portfolios are to be allocated to Norway, Sweden, Austria and Finland, other countries, particularly Ireland, should not be adversely affected. A name that is synonymous with success in the Commission is Pádraig Flynn, our European Commissioner for Social Affairs who has a record on emigration and judicial affairs. His record is impeccable. We in this House may have a subjective opinion but if one talks to those who view it objectively one learns that Pádraig Flynn has been one of the most successful Commissioners in the past two years. I do not doubt he will be offered a portfolio as strong as the one he holds. He will get it on his ability and record. He is known as decisive, which is important in the European context.

The accession of the four applicants would consolidate trade in Western Europe and further enhance the common economic space for the free movement of goods, services, persons and capital. The strengthening of the Union, particularly the strengthening of social and environmental policies, can be expected from the inclusion of the advanced industrial economies of the EFTA countries. The accession of states with long traditions of open government can assist the Union in its search for ways to deal with the democratic deficit in the European Union.

Fisheries is an important issue in my Dáil and Euro constituencies and to all this island. I welcome the proposed inclusion of Norway in the European Union as I believe it will be beneficial to the fishing industry. I hope it will give our fishermen greater access to the North Sea and that Norway will respond favourably. Not so long ago there were no mackerel in the North Sea as they were off the west coast of Ireland. That pattern could change again. If it were to change it would be important that Norway would give us greater access to the North Sea fishing grounds. Should Norway decide not to join the European Union it is important that a bilateral arrangement on fisheries should be reached. The fishing industry is very important in this country in coastal areas where there is no alternative employment.

The European Parliament recently made known its opinion on drift netting to the Council of Ministers. It was deplorable that I as a member of the fisheries committee of the European Parliament witnessed a situation where individual members voted against the interests of fishermen who had been drift netting for years. While that is deplorable it was more deplorable that Irish MEPs from the Green Party voted against the interests of Irish fishermen. This will mean that as and from 1 January, if this is followed through, the fishermen of Castletownbere will not be able to fish off the Spanish coast. One must contrast that with the disgraceful behaviour of the Spanish fishermen who fished in the Irish box when they had no right to do so and now do not wish to share the tuna off the west coast of Spain. The species being referred to at the committee is not under threat and is not subject to quota.

Tá áthas orm go raibh deis agam cúpla focal a rá sa díospóireacht tábhachtach seo maidir leis an Eoraip, maidir le todhchaí na hEorpa agus maidir leis na fadhbanna atá againn taobh istigh den Eoraip. Cosúil le gach duine sa Teach seo beidh mise ag cur fáilte ag tús na bliana seo chugainn, tá súil agam, roimh mheadú an Aontais Eorpaigh.

Mr. Durkan

I welcome this opportunity to contribute to the debate.

Debate adjourned.