Vol. 474 No. 8
4 Mr. McCreevy asked the Minister for Finance his views regarding the proposal, from French officials, that an informal stability council be established to co-ordinate policy among EU member Governments following the launch of the single European currency; and if he will make a statement on the matter. [4006/97]
The treaty makes provision for coordination of economic policies among member states, and this will be intensified with the commencement of European Monetary Union and the coming into effect of the stability and growth pact and the new exchange rate mechanism.
A formal stability council is no longer under consideration in the Council of Economic and Finance Ministers — ECOFIN. It is now widely accepted that such a council would be outside the terms of the treaty. The treaty does not provide for separate ECOFIN councils for the participating and non-participating member states. Although it identifies areas where it is appropriate that, within ECOFIN, only the member states participating in economic and monetary union may vote, all member states would have a seat at the table.
It has, however, been suggested that there may be occasions where it would be useful for the Finance Ministers of member states participating in economic and monetary union to informally discuss matters of common interest, and that an informal stability council could provide a forum for such discussion.
There might be benefits from an informal stability council, whereby euro-area Finance Ministers could informally exchange views on matters of common concern to them. I am, therefore, prepared to consider any proposals which may be brought forward. Nevertheless, in considering proposals for such an informal stability council, I would be anxious to ensure that any such arrangements would not be divisive. In particular, they should not undermine ECOFIN or detract from its work.
I accept the Minister's reply but conflicting statements on this issue are emerging from Germany and France. It appears to be degenerating into a row about the independence of the proposed European Central Bank and whether there will be any political input into that institution. What are the Minister's views on the European Central Bank? Should there be an informal stability council or some other mechanism or should the European Central Bank be independent of national governments?
The Deputy tabled a later question on the independence of the European Central Bank and I have given a comprehensive reply. I hope that question will be dealt with during Question Time.
I do not like a European Union institution that is outside the treaty. The framework of the treaty has served both small countries and the Commission well. The impetus for the establishment of non-treaty institutions tends to come from larger countries. That is not in this country's interest nor is it in the interest of the evolution and operation of the European Union as currently constituted. While I am prepared to consider proposals which might emanate from these discussions and which have been reported from time to time, my preference is for a council which is constructed within the terms of the treaty. That would ensure, inter alia, that the Commission plays an integral part in the deliberations of such a council. Current proposals for an informal council would, by definition, tend to exclude the Commission and that is not in the interest of the Union or of small countries.
I support the independence of the European Central Bank and, as I said earlier, I have offered a more substantial reply on that issue in a later question.
I wish to advise the House that I will take the two remaining Priority Questions, Nos. 4 and 5, in ordinary time.
Will the Minister accept that there must be grave reservations about extratreaty institutions? By definition, they are institutions in which the rights of small countries are least capable of being protected. The Minister should also take on board the growing sense of unease in this country with the notion that the "big boys" in Europe are setting an economic agenda, even with regard to tax matters, which threatens our ability to create jobs on the periphery of Europe. Many people are becoming, if not euro sceptic at least euro realist, in that they realise out interest in this issue is not the same as that of France and Germany nor is it the same with regard to the political direction or nudging of the European Central Bank in the future.
I agree with the Deputy. The treaty is the guarantor for the success of the European Union. The last time the "big boys" in Europe tried to rule the Continent on their own terms there were world wars.
The indications emerging from Germany and France in recent months on the concept of monetary union appear to imply that the dates are more sacrosanct than the criteria. We were told that we must abide by the criteria in order to join. However, it appears some countries will be unable to meet the economic criteria and the "big boys", as the Minister describes them, have decided to change the rules. Does that not indicate that smaller member states will be sidelined in many areas and that we must be increasingly vigilant, particularly in the period preceding the delivery of monetary union if it takes place?
This has been a worrying feature in European developments in the past 18 months. It is not a party political matter and there is universal agreement that the Minister should make it known that we do not wish to see any further developments in that regard because we, along with other countries, will be sidelined.
I share the views articulated by Deputy McCreevy and Deputy McDowell. During the Irish Presidency, I made explicit reference to the unique contribution small countries have made in the course of their Presidencies to advancing the European project. At the press conference in Dublin Castle on 13 December, I said it was a consequence of the Irish Presidency, followed by the Presidency of the Netherlands and with the help of the Prime Minister and Finance Minister of Luxembourg which will succeed the Dutch to the Presidency, that we had managed to put in place a key element of the European single currency project. The role of small countries, therefore, cannot be discounted or ignored if the large countries of Europe want a peaceful successor to their hegemony on the Continent over the last two centuries.
