Eamon Gilmore
Ceist:70 Mr. Gilmore asked the Minister for Finance if he will make a statement on the position on preparations for EMU. [5527/98]
Written Answers - EMU Preparations.
My Department's preparations for the move to stage three of EMU are in accordance with the timetable set out in the Maastricht Treaty, which is as follows. The Council of Economic and Finance Ministers (ECOFIN) will assess whether each member state fulfils the necessary conditions for the adoption of the single currency, on the basis of a recommendation from the European Commission and convergence reports from the Commission and the European Monetary Institute (EMI), the forerunner of the European Central Bank. ECOFIN will recommend its findings to the Council, meeting at the level of Heads of State or Government of the EU member states, who will, after consulting the European Parliament, confirm which member states fulfil the conditions for adopting the euro.
The EMI and Commission reports and the Commission recommendation will be published on 25 March 1998. The European Parliament will be consulted following their publication. ECOFIN will meet to make its assessment on 1 May 1998, with Parliament's formal opinion on 2 May, and the final decision by the Heads of State or Government on the afternoon of 2 May.
As regards national preparations for EMU, clearly the first requirement is that Ireland meets the convergence criteria laid down in the Treaty for membership of EMU, and the Deputy will be aware that Ireland does in fact meet them. Indeed, as regards the budgetary criteria, my Department published figures last Friday which show that Ireland achieved a General Government budgetary surplus of 0.9 per cent of GDP in 1997, compared with an original 1997 budget projection of a deficit of 1.5 per cent. They also show that the ratio of the General Government Debt to GDP fell to 66.3 per cent at the end of 1997 from 72.7 per cent a year earlier. In relation to 1998, a surplus of 0.5 per cent is projected, while the debt ratio is forecast to fall to about 61 per cent by the end of the year. These figures confirm that Ireland complies with the budgetary criteria for qualification for membership of EMU.
On the legislation front, the Central Bank Bill, 1997, is making its way through the Oireachtas at present. This Bill is designed to provide for the compatibility of Ireland's Central Bank legislation with the requirements in the Maastricht Treaty for independence of national central banks and for national legislation, including central bank statutes, to be compatible with the Treaty and the Statute of the European System of Central Banks. Changes to taxation law required for the introduction of the euro are included in the Finance Bill, 1998, which was published on 12 February. It is intended to have legislation enacted before the summer to provide for other changes in national law made necessary by the introduction of the euro and work on that legislation is proceeding at present.
As regards practical preparations, my Department has responsibility for co-ordinating the preparations of the Irish public administration and has a key role in helping the rest of the economy to prepare itself for the changeover.
On 14 January I published the second edition of EMU and the euro: Ireland's National Changeover Plan. The plan is based on the assumption that EMU will begin on time and that Ireland will be a member of it from the outset. It also outlines the timetable for the changeover to the euro. On 1 January 1999, EMU will begin and the euro will come into being as the currency of the participating member states. It will be useable for cashless transactions, e.g. cheques and credit transfers, from that date. However, euro notes and coins will not be available for a further three years, so Irish pound notes and coins will continue in use and all banking facilities currently available in Irish pounds will continue to be available; in other words, individuals will be able to operate in Irish pounds as they do at present. On 1 January 2002, euro notes and coins will be put into circulation and by 1 July 2002 at the latest — probably a good deal earlier — Irish pound notes and coins will cease to be legal tender and the changeover to the euro will be complete.
The plan sets out the changeover arrangements that will be made by the public sector — including, specifically, the Central Bank, the National Treasury Management Agency, the Revenue Commissioners, the Department of Social, Community and Family Affairs and my own Department — the banks and building societies and the Irish Stock Exchange. It also outlines the initiatives which have been put in place by my Department in connection with the changeover. In 1995, a Single Currency Officers Team, was set up. This includes a representative from each Department and its remit is to co-ordinate preparations for the changeover to the euro in the public sector; in 1996 the euro changeover group was set up. This includes representatives from ICTU, IBEC and a wide range of private sector bodies and its remit is to help co-ordinate the changeover across the economy, in 1997 the euro changeover team in my Department was set up, to carry out my Department's tasks in relation to the changeover in the public administration and in the rest of the economy and in 1996 the Forfás EMU business awareness campaign was established to provide businesses with the information they need to prepare themselves for the changeover.
An appendix to the plan outlines the changeover work being done by various public and private sector bodies and lists contact points for further information. A copy of the plan was circulated to all Members of the Oireachtas and further copies are available from my Department and from Forfás, including on the Internet.
As regards preparation by business, Forfás has been running a very successful EMU business awareness campaign. The campaign has produced an excellent information pack for business of which over 30,000 copies have been circulated. The campaign has recently run a radio advertising campaign and has also circulated a summary leaflet in conjunction with the Revenue Commissioners: over 140,000 copies of the leaflet have been distributed. Over 60,000 copies of a leaflet designed for SMEs have also been distributed. Forfás will continue its activities for 1998 and plans to issue further documents on issues such as information technology and a guide for retailers.
As regards further initiatives in 1998, the national changeover plan makes it clear that the focus of the information programme on the changeover will be broadened to include an information programme for the general public on the changeover to the euro which will run throughout 1998 and beyond. This programme will be co-ordinated by my Department in conjunction with the European Commission and European Parliament Offices in Dublin.
Assuming the European Council confirms in May that Ireland fulfils the necessary conditions for the adoption of the euro, a currency changeover board will be established to oversee the detailed implementation of the changeover, including the areas of public and consumer information.