Dáil Éireann díospóireacht -
Thursday, 21 Oct 2004

Vol. 590 No. 6

Council of Europe Development Bank Bill 2004: Second Stage.

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

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

Is onóir mhór dom an Bille um Banc Forbartha Chomhairle na hEorpa a chur faoi bhráid na Dála, agus tá mé ag súil leis an díospóireacht anseo inniu.

This Bill provides for Ireland's membership of the Council of Europe Development Bank. The Council of Europe Development Bank, CEB, is the oldest international financial institution in Europe and the only one with an exclusively social vocation. Its activities are targeted to emergency projects and to strengthening social cohesion in Europe. The CEB is the financial instrument of the policy of solidarity developed by the Council of Europe. We view the Council of Europe Development Bank as a valuable expression of that solidarity and of social cohesion in a wider Europe. Although Europe is one of the most developed regions of the world, there are still large pockets of poverty. This is where the Council of Europe Development Bank assists in development. It acts first and foremost in favour of the most vulnerable and fosters balanced social development in the fields of health, education, social housing and employment. The bank is valued in EU member states, in particular by the countries of central and eastern Europe, as an important source of lending for social projects. Ireland's accession to the bank will be viewed positively by these states as a reflection of our commitment to wider European solidarity.

The Bank is a multilateral development institution, placed under the supreme authority of the Council of Europe. It nevertheless has its own full legal status and financial autonomy. By granting loans, the bank participates in the financing of social projects, responds to emergency situations and thus contributes to improving living conditions and social cohesion in the less advantaged regions of Europe. The question of Ireland joining this bank has been under consideration for some time. It is an appropriate time for this Bill to come into this House as it gives a further signal that Ireland welcomes the accession of the new member states into the EU and displays our willingness to play our part fully in the new Europe.

The current subscribed capital of the bank is just over €3 billion, but only 11% is paid in. The balance is designated as callable capital, but it is most unlikely that this will ever be called on. Ireland would provide subscribed capital of €30.515 million. The paid in capital contribution for Ireland would be €3.369 million. In joining, we must also pay a contribution to the bank's accumulated reserves of €9.764 million. Our full contribution paid in capital and contribution to the reserves, amounting to €13.1 million, will be paid in four annual equal instalments of €3.283 million each. Provision for these costs is being made in the Bill before us here today.

Set up in 1956 and originally named the Council of Europe Resettlement Fund for National Refugees and Over-Population in Europe, it started out with eight members. A number of EU member states joined over the next 25 years. However, with the change in the political landscape in Europe in the early 1990s, the influx of new members over the next ten years reflected the growing interest in the bank. The new member states of the EU and former members of the Soviet Union brought the membership up to 37 different countries. In 1999, the name was changed to the Council of Europe Development Bank.

The primary purpose of the bank is to help in solving the social problems with which European countries are or may be faced with as a result of the presence of refugees, displaced persons or migrants, consequent upon forced movements of populations, as a result of natural or ecological disasters. However, in recent years the bank has expanded its operations to support projects relating to social housing, health, education, rural modernisation, support for SMEs and the improvement of the quality of life in disadvantaged urban areas and the protection and rehabilitation of historic heritage. It is the only European development bank with a social purpose. Its activities are targeted primarily to emergency projects and to programmes directed at strengthening social cohesion throughout Europe.

The Bank provides loans and guarantees, not subsidies, to its member states, to local authorities and to financial institutions. Its loans are intended for the implementation of social projects, which thus enjoy the benefit of favourable financial conditions. Since the bank receives no annual contributions from its members, its financial activity is based on its paid up capital and reserves and the resources which it raises on the financial markets. The bank's capital has been increased regularly since its inception back in 1956 to sustain the development of its activity, while at the same time preserving its financial soundness. The latest capital increase, the fifth, was approved in November 1999 and closed in September 2001. As a result, the subscribed capital increased from €1.401 billion to €3.004 billion. On 31 December 2001, the bank had reserves totalling €814 million and a fund for general banking risks, set up in 1993, amounting to €144 million.

Following implementation of the fifth capital increase, the bank's own funds stand at €4 billion, including available owned funds amounting to €1.3 billion. The bank does not receive any other aid, subsidy or budgetary contribution from the member states to finance its activities. The necessary resources are therefore raised on the international capital markets in the form of borrowings. For its borrowing activity, the bank has been rated by Moodys since 1988, by Standard and Poors since 1989 and by Fitch Ratings since 1996. It enjoys the maximum AAA rating with all three agencies on its principal long-term debt. To ensure that it maintains access to the funds needed to pursue its activities, the bank continues to have recourse both to large scale borrowings in major currencies, aimed at a broad range of institutional investors, and to issues in given currencies or with specific structures.

A total of 78% of the funds raised in 2001 came from the American US dollar market. The euro market came in second position with 13% of the funds raised denominated in euro. The average maturity of issues launched in 2001 is of eight years and four months. The member states submit projects for the administrative council to approve their financing according to the fields of action defined in the articles of agreement and administrative council. To finance these projects, the CEB borrows on the international money markets by means both of public issues and private investments. The quality of its financial structure guarantees the quality of its rating and enables it to raise resources on the capital markets on the best possible terms. This in turn enables the bank's own borrowers to significantly lower the cost of their resources for the financing of social projects.

In order to obtain CEB financing, the projects presented must meet the following general criteria: compliance with Council of Europe conventions, respect for the environment on the basis of international conventions and compliance with standards of quality, participation in the financing of projects may not exceed 50% of the total eligible cost; the balance may be co-financed by other international institutions, and compliance with bidding procedures in accordance with national and international directives.

Since 1994, the bank's circle of member states has widened to include a large number of new states, including EU member states and former members of the Soviet Union. Some 14 states have joined since 1994. The policy developed by the bank is aimed at strengthening its activities in the new member states by contributing to their economic and social development and reducing inequality. It has introduced innovative instruments to meet the specific needs of each country. Some €1.804 billion has been lent to the new member countries since 1995, spread over 66 projects in 14 countries. The loans are issued on favourable terms, with a deferred repayment period being carried on long-term loans, for example.

The sectoral breakdown of approved projects illustrates the bank's capacity for action, not only in its statutory priority sectors, but also in health and education infrastructure, employment, vocational training and employment in small and medium enterprises and the Roma community. The bank has adjusted the eligibility criteria as a consequence of the strategy for supporting the social housing sector which has particular characteristics in the new member countries. The total of disbursements made in favour of the new member countries in 2000 was higher than the total made during the previous five years.

The bank has signalled its intention to become the reference financial institution for the Balkans on the question of refugees and migrants. It has become heavily involved in the work of the stability pact for south-eastern Europe. One of the pact's priorities concerns refugees, and specific attention is being paid to the Roma community. For example, the bank approved a €30 million project in 2000 for the construction of housing in Croatia aimed at facilitating the return and integration of refugees there.

Strengthening social cohesion means contributing to solving the unemployment problem in the first instance. The Council of Europe Development Bank has adopted two lines of action to that end. It promotes the creation and preservation of jobs and supports investment in SMEs, which are the principal source of new jobs and vocational training. Action in favour of employment is one of the bank's new priorities. It has financed several projects aimed at the preservation and creation of jobs in small and medium-sized firms in many countries.

The governing board sets out the general orientation of the bank's activity, lays down conditions for membership and decides on capital increases. It approves the bank's annual report, accounts and general balance sheet. The board consists of a chairman and one representative from each of the bank's member countries. The administrative council exercises the powers delegated to it by the governing body, establishes and supervises operational policies and approves investment projects submitted by Governments. It votes on the bank's operating budget. The governing board elects the chairman.

The governor, who is the bank's legal representative, heads up its operational services. He is responsible for the bank's staff, under the general supervision of the administrative council. He conducts the bank's financial policy in line with the administrative council's guidelines and represents it in its transactions. He examines the technical and financial aspects of requests for financing to the bank. The auditing board consists of three members who are appointed by the governing board. It checks the accuracy of the annual accounts which will also be examined by an external auditor.

I reiterate the Government's view that the Council of Europe Development Bank is an important part of the operations of the Council of Europe. It plays a vital role in the new and expanded Europe. Ireland's membership of the bank at this time is a valuable expression of its solidarity with the new and expanded Europe at an exciting and historic period for the growing European Union. I commend the Bill to the House.

Mr. R. Bruton

I welcome this Bill which deserves the support of all parties in the House. It is right that Ireland, which is the second wealthiest country in Europe per head of population in gross domestic product terms, should take much more seriously its commitments to assisting development within Europe and the developing world. Ireland has been a significant beneficiary of assistance from development banks and development aid, in particular that provided by the EU. Substantial increases in development aid from the EU were not the least significant of the many factors which contributed to the development of the Celtic tiger economy. The funds received from the EU allowed us to tackle many serious infrastructural and social issues which we would not otherwise have been able to address.

A feature of Ireland's dealings with development donors has been its astuteness in the use of moneys received from them. Many other countries have admired the good systems of prioritisation and programme delivery developed by Ireland, with the assistance of the EU, in its formative years. It is sad that the good procedures we developed have been allowed to rust in the past four to five years. Our capacity to deliver programmes has been called into question as a consequence of huge overruns in many development budgets, especially the roads programme. The costs of many road projects were grossly inflated as a result of an incorrect initial estimation. The virtues we learnt in the leaner years have been disregarded in recent years, especially by the Government. There have been appalling examples of virtues such as sound financial procedures and project evaluation being ignored by the Government in its decisions.

We can learn lessons that will help us to correct our ways, most topically in the context of the Bill before the House. We must examine our development aid programme to ensure that the approach to the use of development funds which was so successful in Ireland becomes a hallmark of the development assistance we distribute elsewhere. Ireland is providing just €13 million, which is a drop in the ocean in terms of overall development aid. One of the advantages of providing funds through an established body like the Council of Europe Development Bank is that we can be confident that the money will be used in a prudent manner because it has strong criteria. I am confident that funds will be put to good use in the many projects to which the Minister of State referred because sound procedures will be put in place to support them. That is an important aspect of Ireland's development aid strategy.

We cannot allow this debate to pass without raising again the Government's apparent withdrawal from the clear commitment it made to increasing its level of overseas development aid. The Taoiseach stated categorically at the UN Millennium Summit that Ireland would achieve its development aid targets of 0.45% of gross national product by 2002 and 0.7% of GNP by 2007. Ireland dismally failed to achieve the 2002 target scarcely 12 months after the Taoiseach made his commitment. Our development aid budget was one of the victims of the cutbacks which were made immediately after the 2002 general election. The budget was reduced by €40 million as part of the Government's attempt to correct the excesses it had entered into in its pre-election campaign. Some of the poorest people in the world became victims of the Government's poor management of the economy.

I am disappointed that the incoming Minister of State at the Department of Foreign Affairs has described the promise to contribute development aid of 0.7% of GNP by 2007 as a declaration of intent rather than a firm commitment. It is has been watered down. It is not acceptable that a promise made solemnly by the Taoiseach on behalf of the Irish people at a UN summit in the run-up to the poll on Ireland's application for a position on the UN Security Council was forgotten after that election was finished. We have already seen that the Government's promise has not been matched by a commitment. Ministers are trying to wriggle out of their 2007 commitments.

I wish to state bluntly the nature of the commitment the Government has made in respect of 2007. Economists forecast that Ireland's GNP will increase by 26% by that year. If we are even to mark time with our development aid, we must increase it by 26%. If we are to take the proportion from 0.4% to 0.7%, we must increase it by 75%. That is the scale of the commitment that has been made. The time lost to date means that it will be more difficult for the Government to fulfil it. It is not acceptable for Ministers to start talking in terms of multi-annual programmes. Those are weasel words which suggest that we are backing out of the commitment but in such a way that it does not appear obvious. No doubt the Minister will produce some figure in the 2005 Estimates and say that we will fund a certain amount. We will increase it in the next two years, ignoring the fact that gross national product will rise and that the target is moving. The Taoiseach's commitment on behalf of the people boils down to a commitment that our development aid budget will go from €480 million today to €1.1 billion in 2007. That is more than double. To achieve that target, we must see €195 million extra each year committed to the development aid budget. The test of the Government's commitment in this area will be to see whether that extra €195 million is made available in the Estimates in 2005.

I was interested to hear the comments of John O'Shea, a man for whom I have great respect and who has spent his life working in support of development aid. He made the point, which struck home, that we are inadvertently supporting some very corrupt regimes with some of our development aid. There are serious questions about the extent to which elements of our development aid are getting through, and they are being raised by someone whose bona fides in the area is beyond question. The Minister must come to the House and put in place the sort of review that will underpin that to ensure that we do not make such errors. We must also move steadily towards using agencies whose criteria and procedures we can stand by. It is important that we use those voluntary agencies and non-governmental organisations working in the field, and development banks whose procedures we can stand by more than at present. One of the points that John O'Shea made and which we must consider is that, if one expands budgets very rapidly without heeding who is getting the funds, one can waste some of that money. However, that should not be used as an excuse for pulling back from our commitments.

I therefore suggest that, if the Government lacks confidence in the agencies using the money, the Minister and Taoiseach should, in much the same way as has happened with the pensions fund, put the money into a fund to be held and used when suitable projects become available. In that way, there would be a fund to call upon when an important project came our way that deserved to draw down money from it. Just because we have moved rapidly to double our overseas development assistance budget over the next three years, we should not become indiscriminate in how we spend it. By holding moneys in a capital account and putting in the work to identify projects that will yield real benefit, we can both achieve high quality results in the use of our money and fulfil our commitment regarding development aid.

One important element of Government strategy has been the support for dealing with the debt problems of many developing countries. It is alarming to see the sheer scale of the commitments being made, especially by countries in sub-Saharan Africa, to pay interest on existing debt. I suppose that the hard-headed will ask what the debt incurred was used for and whether the projects have yielded results. However, those hard-headed people who ask such questions cannot ignore the fact that, in many of those countries, the standards of health care and education are at a deplorably low level. To see so much money used to pay interest at a time when they are having to scrimp on budgets for basic human needs is not acceptable.

However, the Government's good case for a much stronger programme of wiping out debt is undermined if it does not commit itself to its development aid targets. Ultimately, if banks lend, someone must pay. If the banks have savers who have put money into accounts, someone must take the hit when one cancels debt. If the governments of the world are not living up to their commitments on development aid, there will not be the resources to ensure that, when the debt is wiped out, the burden does not fall on people who do not deserve to shoulder it. That must be done by Governments across the globe. There is an obligation on the Irish Government to show in the most practical way possible that it believes in dealing with the debt programme of developing countries by living up to its commitment on development aid.

I would like to turn briefly to the Council of Europe development budget. Like all of us in recent years, I have had the opportunity through the opening up of central and eastern Europe to visit countries that for a long time were a closed book for most people on this side of the world. I have had the privilege of visiting quite a number, including in the former Soviet Union. It is depressing to see people of such enormous talent and commitment burdened with the great difficulties which confront them. They are trying to change systems that have suffered from sclerosis for more than 50 years so that they can deliver. They are trying to move to a more market economy and upgrade their education system to deal with the needs of modern technology. They are trying to address health issues that have become much more complex owing to the rise of new illnesses. Those countries are extraordinarily full of potential yet face extraordinary obstacles.

They are very much like Ireland in the 1950s and 1960s — full of potential and with a population exhibiting great energy, commitment and zeal for reform but hopelessly obstructed by the inheritance of the previous 50 or 60 years. I am pleased that Ireland is, perhaps belatedly, becoming involved. The work of the bank can make a significant contribution. I would like to see us not only fulfilling our mandate in providing moneys to the bank but also trying to breathe life into its entire operation in central and eastern European countries, many of which now look to us as a shining example of success. We have much that we can deliver to those countries in advice, but unfortunately a great deal of that advice is probably now being bought at quite phenomenal expense through consultancies.

Ireland has the opportunity to consider not only contributing financially to the development of central and eastern Europe through the Council of Europe Development Bank but also putting together teams of advisers to use the knowledge that we have applied successfully in industrial and technological development and the emergence of the institutes of technology, which are an important education band. Even the great Michael Porter says that they are one of Ireland's significant successes. The Government must examine the possibility of capturing the experience and knowledge that we have developed here and making it available to developing countries in central and eastern Europe, not through paying the highest price to consultants but by Government support for people who are willing, perhaps in their later years, to give their time to those countries. That would be a useful supplement to the financial commitments that we are making and also be valuable in the realpolitik of building up good relationships with the emerging countries of central and eastern Europe which will be so important in the long term to Ireland’s ongoing economic and social success. I welcome the Bill. The activities of the bank with regard to refugees, floods, vocational training, various crises and long-term development are worthy of our financial support and of greater commitment by government to non-financial support. That can often be equally important as it can ensure that the financial support is used to good effect.

The Taoiseach has made a solid commitment before the UN on behalf of the Irish people and it is not now acceptable to hear Ministers using weasel words in an effort to weave about and back out of the commitments. The only way to silence those who have become sceptical about the Government commitment is by means of an increase in the order of €200 million in the 2005 Estimates, to be repeated in 2006.

An Ceann Comhairle

That is outside the scope of this Bill, though a passing reference is in order. This is a very technical and limited Bill.

Mr. R. Bruton

It is from those funds that we will be contributing.

An Ceann Comhairle

I accept that and a passing reference is quite acceptable.

Ms Burton

I wish to share my time with Deputy Howlin.

The proposal in this Bill relating to Ireland's membership of the Council of Europe Development Bank is welcome. It is a pity it has taken the Government approximately two years to introduce the Bill. I doubt if anyone could disagree with the work of the development bank. Basically it promotes notions and activities relating to social solidarity, particularly with regard to eastern European countries.

Among other tasks, the bank deals with the Balkans and with some aspects of the aftermath of the wars there, in particular the measures to assist refugees to resettle in their home countries, such as Croatia and other parts of the Balkans. That is very welcome. From an Irish perspective and that of most western European countries it is sensible because while people are often distressed by the arrival of numerous refugees in western Europe, the measures to be taken must include building up the economies of poor countries so that people there can have a decent life for themselves and their children.

We know about emigration from Ireland after the Famine, but many Irish people on the emigrant boats going to America or Liverpool would have greatly preferred to stay in Ireland and bring up their families here. They had no alternative. Similarly, the phenomenon of refugees and economic migrants throughout Europe, largely caused by the extremes of poverty, would be reversible if economic conditions in the refugees' countries of origin improved to the point where people could offer themselves and their children a decent life.

During the various heated debates, particularly on the most recent referendum, instead of looking at what causes economic migration and refugee problems we were promising action when the problems had already arisen rather than working on them at their inception in terms of promoting solidarity and social cohesion. I welcome the moves by the Council of Europe Development Bank to address migration and refugee problems, in particular the difficult question of refugees returning to their countries of origin once some form of peace has descended. We have had a large Bosnian community in Ireland for some 12 years. Most of those people still cannot return home because of ethnic cleansing. Many of them were injured during the war in places like Sarajevo or were ethnically cleansed from their original home area. That is the reality of war. Something similar is now happening in Iraq, which in effect is splitting into three separate camps, with population movements resulting.

I welcome the Bill's specific reference to the Roma people, regarding whom there are lessons to be learned in this country. We saw the recent Garda activity on Dunsink Lane. What happened there is the result of a problem brewing for some 20 years yet when the Garda finally acted they did so in an extreme fashion. There are Roma communities in a number of eastern European countries. In Ireland, some Roma people in recent years have engaged in a great deal of begging, while their children get no opportunity to attend primary school. All of this greatly distresses Irish people who must try to decide if it is better to assist a child who is begging or contribute money to charity. These are personal decisions.

I have visited Roma communities, particularly in northern Greece, and their size and poverty levels can be compared only to some of the poorer townships in South Africa. This is how the Roma people live in various states in eastern Europe, so any programme which seeks to integrate them into a wider network of educational and economic opportunity and which would also allow them to live in their traditional places of residence must be welcomed. Those two aspects of the programme are particularly welcome.

There are a number of banks which operate as clearing houses for money involved in development projects or which grant aid or loan-aid various developments at specific rates. Because poor countries cannot borrow at cheap rates on the international market, a development bank organises the aid for them. There must be accountability for the type of projects which development banks operate and such projects must take into account the environmental as well as the social fabric of the country or community where the projects are operating. There is a long history in development banks of projects which turn out to be white elephants. These have included over-expensive airports and dams which seriously damaged the environment of the country or area in which they were situated. I hope the Council of Europe and the parliamentarians who participate in it will ensure there is a transparent system of accountability for the many projects which the Council of Europe Development Bank will undertake.

We are aware that the World Bank, which oversees such projects not only in poorer parts of Europe but also in developing countries and Africa, has been hidebound by the strictures laid down by the International Monetary Fund. The IMF basically says to poor countries "Here is the medicine, take it and reduce investment in education, health and housing". If we are establishing a development bank to do the laudable things set out in the Bill in respect of housing and social infrastructure, we must ensure the World Bank and the IMF are not standing two steps higher on the stairs and saying that something is a good idea but that it does not fit in with economic orthodoxy and cannot be allowed, except in connection with small demonstration projects.

The recipe the World Bank and the IMF put in place, which arose out of the doctrines followed by Mrs. Thatcher and Ronald Reagan when they were in power, has, by and large, done a great deal of harm to many tens of millions of people throughout the world. Wiser economic understanding is beginning to prevail. People recognise that as well as promoting economic development, the welfare of human beings, families and children must also be promoted. The World Bank has embarked on a systematic programme of policy reform. Some of those reforms are welcome but the bank has some way to go.

Deputy Richard Bruton referred to the critique John O'Shea of GOAL made of certain countries. I wish that people making critiques of countries such as Uganda would also criticise what the IMF did to that country when it drove down the price of coffee upon which poor farmers there relied to pay their children's school fees. A similar situation would be where Ireland might opt not to be independent and might instead be run by a series of charitable organisations, all well intentioned but operating out of London. In such circumstances, the country might be at a higher stage of development. However, the reality is that African countries wish, like Ireland, to be independent. Are their governments flawed? The answer is "Yes". Are our Governments perfect and has Ireland remained free of corruption? The answer is "Absolutely not". Is that, however, a reason to gainsay our having an independent Irish State and Government?

This is an extremely difficult argument but we must be realistic and recognise that people have a desire to be independent within their own countries. We have identified a series of measures to promote anti-corruption, governance, a genuine participatory democracy, a free press and a free judiciary. These are the minimum hallmarks of a functioning democratic government. When we make arguments about states, we need to consider the entire picture. I did not hear a condemnation of the notion of independent governments which also included questions about the responsibility the IMF bears for the plight in which many such governments have found themselves. The IMF forced medicine on its patients and, in many cases, killed them off.

I wish to refer briefly to the target for development aid. I was employed as a development aid worker in Tanzania for three years. I worked there when the IMF economists, who were all men at that time, arrived with their suitcases and gold pens and wrote out a recipe to reduce investment in education by 50% and in rural health by 50% or 60%. If that recipe had been applied in this country, not only would there have been an economic collapse but there would also have been an economic revolution.

We must consider what has happened in Africa and the developing world during the past 20 or 30 years. That is why the Irish commitment to development aid is vital. Not only is it important in terms of our history as a country and the effect it can have in developing countries, it is also important because we set a trend in 1992 when the then Taoiseach, Albert Reynolds, agreed to increase development aid — this was one of the Labour Party's demands on entering Government with Fianna Fáil — to the UN requested standard. One of the results of this was to place Ireland where it is now, namely, in the upper ten. However, it also encouraged other countries to reconsider their spending on development aid and increase their commitments in that regard. Prior to that point, many countries had simply walked away.

The amount of money we invest in and our commitment to development aid is important for Ireland as a country and also in terms of what it says to other countries. Our level of commitment and aid has begun to set a trend. I hope the Taoiseach was serious in reiterating the solemn commitments he made in respect of this matter. I also hope that the remarks made by the Minister of State, Deputy Conor Lenihan, were simply reflective of the kerfuffle that accompany one's first days in office and that he will now act as a defender of the commitments made in respect of development aid.

Mr. Howlin

I welcome the opportunity to contribute to the debate on this important measure. I do not believe it will attract many headlines but it is one of the more important items of legislation we will debate in the House in the coming weeks.

I have the pleasure and privilege of representing the House in the Parliamentary Assembly of the Council of Europe and I am familiar with the work of the development bank. There is a certain irony in the fact that the bank was established in 1956 and that Ireland is only now getting around to applying for membership. That is an indication of our mindset during the years in question. Ireland was itself a developing country and did not want to make capital available for use elsewhere. It is a signal that we have arrived and that we are embracing our new responsibilities that we want to be involved with the development bank and that we see our role expanding in respect of a changing and developing Europe. That we have a much stronger situation at home is also a factor.

I wish to refer briefly to the Council of Europe, which is a little known organisation in this country. When one refers to the council, people often confuse it with the European Council. This is due to the fact that the EU uses the same anthem and flag as the Council of Europe, both of which it borrowed from the much older institution. There is confusion about the role of the Council of Europe in general. It was created in the immediate aftermath of the Second World War to bring the strands of European identity together, based on the fundamental principle of human rights. The bedrock institution of the Council of Europe is the European Court of Human Rights. The European Convention on Human Rights is the most important legal instrument that binds together the countries of the Union. It was again an irony that it was only 50 years after the promulgation of the European Convention on Human Rights that Ireland transposed it into domestic law. That just shows that we are slow to catch up. However, there were those who argued that our constitutional law offered even greater human rights protection than the convention.

The role of the Council of Europe is still extremely relevant. There are those who would argue that because of the development of the European Union, its role has been somewhat diminished. Since the fall of the Berlin Wall in 1990, however, there is a swathe of new emerging democracies in central and eastern Europe, including some from the former Soviet Union, which want to measure up, and which have signed up, to the democratic principles and human rights accords of the Council of Europe. It is a job to ensure there is proper monitoring of those standards. That is something for which this country will have to take responsibility.

The Minister of State described the development bank as an institution with an exclusively social vocation. Few of us would ever describe any bank as having such a vocation. Such an entity is welcome and worthy of salute. If one looks at its role, limited as it is by its restricted access to capital, the bank can play an important part in dealing with the vital issues of social cohesion outlined by my colleague, Deputy Burton.

I wish to address the general conditions for obtaining finance from the bank outlined by the Minister of State. The projects to be supported include social housing, health, education, rural modernisation and small enterprise in addition to those within the bank's original remit of dealing with refugees, displaced persons and migrants, together with hunger the pre-eminent issues in post-war Europe.

A considerable amount of social work remains to be done. I will briefly explore the eligibility criteria laid down for receiving support which strike me as important. How will they be validated given that the resources of the Council of Europe Development Bank are such that it will be able to monitor the position to ensure all conditions are fully met? Some of the criteria, for example, compliance with Council of Europe conventions, are extremely important. Even within the Council of Europe, however, it is very difficult to ensure that all member states, particularly more recent members, comply with conventions and the need for a gradualist approach is acknowledged.

I digress briefly to concur with Deputy Burton's important comment on Deputy Richard Bruton's intervention. Deputy Bruton referred to giving development aid to corrupt regimes. We can be precious in this regard. A little trot up to Dublin Castle would indicate that Ireland would not qualify for a place high on the list of countries with a pristine record on corruption. As a developed country with a free press and so forth, we have had considerable corruption. Developing countries such as Uganda, for example, which suffered Milton Obote's robbery and viciousness, followed by Idi Amin's savagery and cannibalism, are trying to emerge from their past and need to be supported. Uganda has achieved remarkable successes in terms of the incidence of AIDS and is beginning to make remarkable progress on literacy.

We should not be entirely critical. If we demand that countries measure up to criteria on corruption based on the European model, we will not be able to support any country in Africa. They do not need a superior, colonial attitude by which we dictate that they must live up to certain criteria or receive nothing.

The mechanisms operating in Africa are the New Partnership for Africa's Development, NEPAD, and the Pan-African Parliament. Progressive, moderate, democratic thinkers are introducing their own standards in these forums and have developed the African peer review mechanism by which progress can be measured by Africans. Having economically raped African countries, former colonial powers must not set the standards by which African countries must measure up before being allowed development aid support. I make this aside because realism is required regarding the measurement yardsticks we place on projects, even in the wider Europe where countries in the former Soviet Union have poor economies and fragile democracies. We need to bed down democratic institutions in a supportive way.

As a former Minister for the Environment I am wedded to the notion of respecting the environment on the basis of international conventions and adopting compliance with quality standards as a criterion. There is a danger that support will be provided to economic projects which will create environmental degradation and have long-term negative consequences. It is important, therefore, to apply criteria. I remain unconvinced, however, that sufficient mechanisms are in place to carry out the requisite level of evaluation. Will the Minister outline specifically the monitoring mechanisms in place to monitor investments from the bank? Will he also indicate the reporting role and structures in place as well as the interplay between the bank and the committees of the Parliamentary Assembly of the Council of Europe and the assembly proper?

Real issues arise in Europe from which we cannot escape. It is timely, therefore, to become involved in sharing the burden of ensuring that social cohesion is realised across Europe. This is not entirely an altruistic perspective because it is in our interests to establish a band of economically healthy states with social and economic cohesion well beyond the borders of the member states of the European Union.

Migration, as we observed during the recent referendum, is a major issue. Unless and until the standards of living in countries bordering the EU are raised to a sufficient standard, we will endure the pressure of people seeking a decent standard of living arriving on our doorstep. We all recognise that many of the people claiming political asylum are economic migrants.

It is to our great shame that we do not have a separate structure to deal with economic migrants. We have been promised a work permits Bill to introduce a green card system and remove, as it were, the notion of the employer as master and the employee from non-EEA countries as the bonded servant of the permit holder. We have all dealt with horror stories of people who have been told that if they do not like their working hours or living conditions, they can go home. This is not an economic option for many migrant workers. We must live up to our responsibilities in this regard and the legislation in question must be introduced at an early date to ensure that those with work permits who can find alternative employment have a right to move employment.

Rational, structured approaches to this issue are available, as developed countries such as Canada and Australia have proven. Economic forecasts indicate that we need new migrants to secure development and growth in future but still have no structured way to address the matter. The shortages of nurses are an example of our approach. It was ridiculous to scour the world for nurses while remaining reluctant to allow their spouses to enter the country. What professionals will come here if they are told they may work until such time as we can train sufficient numbers of Irish people, after which they will be turfed out, and that they may not bring their family in the interim? They are likely to go to a regime which is family friendly and allows them to establish roots and a future for themselves and their families. We have still not grappled with this issue in a satisfactory manner.

Other issues, including one I raised on the Order of Business, also arise. We need to be alert to the changing migration system. Today, Irish Ferries announced 150 jobs will be lost on the Rosslare-France route. The Irish seafarers working the route will be made redundant and the ferry in question will be manned on an agency basis by other EU workers when it begins operations again in the new season. If that goes unanswered, there will not be an Irish seafarer left on any route. They will all be downgraded.

If there is a perception that nationals of the east European new member states will undercut Irish jobs, it will lead to racial tension. We should and can avoid this by insisting that wages and conditions for all workers, from whatever part of the Union, are of equal standard. The unions are fighting hard for this but the Government must state that it will not allow migration to be used to undercut the standards of living and wages and the quality of jobs that the unions and workers of this country have built up over decades. It is an extremely important issue and is relevant in the context of this Bill.

Ireland has a responsibility to build the type of cohesion throughout Europe that it has begun to establish in this country. I welcome the fact that we are belatedly joining the Council of Europe Development Bank and I believe we can play a good, strong and unique role in it. The Netherlands is strong and pre-eminent not only in membership of organisations such as this but also in the development of policies in these areas. There is no reason that Ireland should not also be at the cutting edge of policy formation in international institutions such as this. Europe, and ultimately the world, would benefit greatly from that input.

Ms Harkin

I wish to share time with Deputies Boyle and Ó Caoláin. Like the other Deputies who have spoken, I welcome this Bill. According to the Department of Finance press release about the Bill, it is a response to the recommendations of the Ireland Aid review.

While I welcome the Bill, it is interesting to read the preface to the Ireland Aid review in which the then Minister of State, Deputy O'Donnell, stated:

In September 2000 the Fianna Fáil/Progressive Democrat Partnership Government decided that Ireland would reach the UN target of 0.7% of GNP for expenditure on Overseas Development Assistance by the end of 2007 . . . Though long committed to achieving the UN target, this is the first Government to publicly pledge to meet it within a specific time-frame. It involves a major increase to almost €1 billion annually by 2007 ... I take great pride in this historic decision. It is my priority as the responsible Minister to achieve the UN target within a stated time-frame. Crucial support from the Taoiseach, the Tánaiste, the Minister for Foreign Affairs and the Minister for Finance ensured that the aid budget has been placed on a secure financial footing for the future, liberated from the vagaries of the annual Estimates process.

Deputy Howlin echoed her words when he said that we need to build the type of cohesion across the EU that we have built in Ireland.

However, in recent days we have heard that the Government will be unable to keep that commitment. If we cannot reach that target when we have the fastest growing economy in the EU, when can we hope to reach it? Ireland, it appears, is out-performing all the countries in the EU. It is expected that growth will be 4.5% this year and 5% next year. That is nearly twice the average anticipated growth for the EU. Our gross domestic product is second only to Switzerland's. Now is the time to meet our commitment. The Government has its priorities but, as a country that exported emigrants to all four corners of the world where they made new lives and as a country that is now enjoying new prosperity, I doubt there will ever be a better time to keep the promise Deputy O'Donnell made. Will the Minister consider that?

The report of the Ireland Aid review suggested that Ireland should join the African and Asian development banks. Although I might have missed it, I did not see a recommendation to join the Council of Europe Development Bank. However, membership of this bank is the right step. This Bill is important legislation and the Government can be proud of it. Our membership of the bank will allow Ireland to contribute to the development of eastern Europe and parts of central Europe.

A number of Members spoke about how Ireland benefited from its membership of the EU. It receives the highest level of aid per capita and, despite our high GDP and phenomenal growth rate, it still receives more money from the EU than it donates to it. This is due to the Common Agricultural Policy and regional funds. Although those moneys are tapering off, Ireland still benefits substantially from European money. Becoming a member of this bank is the right step to take and conveys the correct message to the new member states of the EU.

I wish to comment on development aid. According to the Ireland Aid review, our aid programme must be underpinned by a number of key principles. These include effectiveness, value for money, transparency and accountability. One of the critical issues is that the development aid reaches those who need it most. However, I am concerned about a worrying trend at European level whereby development aid is being subsumed and there will no longer be an identifiable EU development policy. I am concerned that development co-operation will not be seen as a policy area in its own right. According to a Dóchas document on EU development policy:

The regulation on development co-operation and economic co-operation has a global coverage, including OECD countries, and therefore has no specific relevance or application towards developing countries. The new regulation mixes a variety of policy objectives, and therefore can, and will, no longer guarantee a place for development policy.

Within the next 12 or 18 months, this country will vote on the new EU constitution. I believe the lack of a specific focus on development aid will contravene the principles in the EU constitutional treaty. That treaty confirms that development co-operation is an autonomous policy area and that poverty eradication must be its overarching objective. The EU is committed to the millennium development goals but to achieve those goals we must maintain a specific focus on them. I urge the Minister to bear this in mind.

With the war on terror since 11 September 2001, there could be a tendency to mix up or bring together development aid and what could be called securitisation. I can give an example. Let us say the Irish Army is to go abroad on a mission but beforehand the personnel must train in the Curragh for their security or conflict prevention tasks. It is critical that money earmarked for development aid is not spent on that securitisation but goes to the people who need it most. Our development aid policy must, in the final analysis, ensure an eradication of poverty. I want to be sure this country will draw a definite line between development aid and securitisation.

Mr. Boyle

The Council of Europe is a forgotten institution. This House interacts with it frequently through the participation of several Members, as well as some Seanad Members, in the Parliamentary Assembly, yet there is little interaction with other Members of this House as to the nature, quality and importance of that work. Subsequently, there is little opportunity for the House to impart the value of that work from this Chamber to the public. There is little knowledge of the existence or importance of the Council of Europe, which is a more embracing organisation than the European Union. Practically every nation of Europe is a member of the Council of Europe and it has a different focus in that it seeks to drive a social and human rights agenda whereas the European Union seems more concerned with matters economic, though this is a matter of debate and, unfortunately, with policy aims that seek to advance economic aims such as a common foreign policy and defence and security policy. Therefore, we should welcome Ireland's belated participation in the Council of Europe Development Bank.

Perhaps this is a recognition that we in Ireland are finally losing our victim status and have something to contribute. We have been a poor country for most of our history. Nonetheless, it is sad that when we achieved independence in the early 1920s our gross national product was similar to that of many of the Scandinavian countries. In terms of economic development, we did not make the most of economic opportunities but, rather, we stagnated. There was little economic development or, perhaps, reverse economic development. The Minister, as a member of a party that has been in government for 50 to 55 years of the history of the State, might care to ponder this when we consider the plight of the many other countries in Europe which would benefit from the existence of the European Development Bank and the loans it can offer.

When the bank was originally established in 1956, the social problems in Europe centred around the questions of resettlement of refugees and mass migration throughout the continent caused by the Second World War. It is a sad irony that many of the projects being funded by the bank relate to similar issues, for example, the results of migration from the Balkan conflicts, the need to rebuild urban settlements and the need to resettle people in the communities from where they once came. However, a further irony is that many of the countries contributing to the bank and the fund have in their trade arrangements, particularly in regard to the arms trade, helped provide the weapons of destruction which wreaked havoc on many other countries. Ireland could play a role in this regard. Although we are becoming a member of the bank late in the day, we should maintain a moral authority in terms of an independent foreign policy on issues of neutrality, the use of force and the obscenity of the arms trade, which is considered part of an overall economic programme and may even be defined as economic progress.

Other speakers referred to the difficulties concerning development banks as they exist in other forms. The World Bank is an obvious example, and the damage it has caused, particularly in the developing world, has been acknowledged not only in this but in other debates. There are European banks which style themselves as development banks, for example, the European Bank for Reconstruction and Development. Again, few seem to know of this bank and, as a Member of this House, I get no reports on the nature of its work. As it is an arm of the European Union, I suspect it is doing work related more to economic than social development goals.

A mindset exists that the economy is the key issue. Not only is it the prevailing philosophy of the Government but it has affected our permanent government. This morning I attended a presentation on renewable energy. One of the speakers indicated that he or she had recently attended a lobbying session in the Department of Finance, where a senior official stated that the Department did not believe in the environment and did not believe that the Kyoto protocol would ever be ratified. This mindset believes that the economy is the thing — an end in itself rather than a means to achieving all other ends in a society. Until we overcome this mindset within our Government and parliamentary and decision making processes, and international decision making processes which we can, as a small nation, try to influence, the fear must exist that this will be the dominant attitude rather than a belief in real social justice and real development throughout the world.

The money being given to the development bank, which has a specific geographic application in terms of the countries of the Balkans and former USSR that will benefit from the fund, cannot be divorced from our overall policy or seeming lack of policy on the question of overseas development aid. Many confused signals have emanated from Government in this regard in recent weeks. A Government commitment that was believed to exist no longer does and is certainly no longer an obligation. It is now stated that the Government will make every effort, as a policy goal, to achieve it but if it does not, at least it tried.

For many on this side of the House and those involved in developmental work throughout the world, this is not good enough. Specific targets were laid out that the Government has an obligation to meet. If we are to achieve the target of 0.7% of GNP for overseas development aid, we must do so by having a target of 0.5% for 2005, 0.6% in 2006 and 0.7% in 2007. The confidence no longer exists that the Government is prepared to deliver on that commitment. It will require a change of Government or, possibly, specific legislation as is before us today. It may be argued that is the responsibility of the Department of Foreign Affairs. However, we are today entering into an international commitment on legislation introduced by the Department of Finance. If the Government wants to restore the willingness of the country to achieve the 0.7% target and the confidence in our ability to do so, this can only be achieved by bringing a money Bill before the House at the earliest opportunity to show how the target will be reached.

The Bill outlines how we will pay the overall commitment to the Council of Europe Development Bank in stage payments over a number of years. There is no reason similar legislation cannot be introduced on overseas development aid which would outline how we would get to 0.5% next year, 0.6% the following year and the ultimate target of 0.7%.

Many believe that the UN target is one we should seek to surpass, whether we are within the top ten of current donor nations in this regard. We have much to give in this area, including moral authority. This has been compromised by the Government's efforts in other areas, which were intended to ensure we are seen to be a partner of many countries the policies of which, trade and foreign, have brought about many of the problems in the developing world. However, we still maintain the distance that gives us the moral authority to allow such legislation to reach the Statute Book and have effect. On those grounds, the Minister should use the vehicle of the Bill to consider how we are addressing the overall question of overseas development aid and to properly address the concerns that exist.

I hope we can have a better explanation in regard to compliance with environmental safeguards. I have confidence this can be better achieved through this bank than through EU institutions. Very often, as experienced in regard to regional programmes in Ireland, money is given on the basis of regional and economic development which has opposite environmental consequences.

That argument could be made in the context of national roads programmes as opposed to investment in public transport. If that is what is happening here, is it not likely that developing countries within the rest of Europe, in eastern Europe and the Balkans, will be subject to similar policies through money being available through funding from institutions such as the Council of Europe Development Bank?

We need to achieve the type of balance that allows not only for environmental protection but for environmental sustainability into the future, that allows for economic progress that is not measured in terms of the length of concrete a country has but has more to do with how people can live and exist in the situations in which they find themselves. It is those kinds of criteria that are lacking in terms of assessing how institutions such as the development bank can be effective and how effective they are in making moneys available to people.

On those grounds, despite the general welcome for our belated involvement in this institution, I hope we can use our membership to ask relevant questions, to seek better criteria and ensure this institution can be the most effective it can be in this area.

Caoimhghín Ó Caoláin

I welcome this Bill which finally provides for the overdue accession of this State to the Council of Europe Development Bank. This Bill was promised by the Minster for Foreign Affairs for 2002. Why has it taken so long to get to this stage as, clearly, it is not very complicated legislation?

The bank's stated aim is to help address the social problems with which European countries may be faced as a result of the presence of refugees, which includes displaced persons and migrants, including those who have been forced to move by natural disasters.

The Council of Europe and the Council of Europe Development Bank were established in the wake of the Second World War when there were movements of vast numbers of refugees within Europe. It was a period of reconstruction but also of division as Europe was split into what can only be viewed as two hostile camps. The face of the Continent has changed hugely in the period since that time. The end of the Soviet Union, the fall of Stalinism in eastern Europe, and the expansion of the European Union have created new political, economic and social conditions in Europe.

In the same period Europe's relationship with the rest of the world has also changed. Tragically, however, the economic gap between the wealthier countries of Europe and the poorer countries of Africa, Asia and Latin America has grown wider. A direct consequence of this widening gap is the movement of migrants into Europe on a large scale in search of the employment and security which they have been denied in their home countries. The issues which must be dealt with now mainly concern the new arrivals to Europe, immigrants from outside the Continent rather than migrants within.

This State has failed those people. We are debating this Bill in the wake of the citizenship referendum, at the result of which I have repeatedly expressed my regret. It has enshrined inequality in the Constitution. Many people in future will regret the powers they have given to Government to determine who can be an Irish citizen. Despite the Government's protestations to the contrary, the referendum most definitely reinforced what I regard as myths and prejudices about asylum seekers and refugees in our country. It has fed racism as has been shown by the very regrettable increase in racially motivated attacks on members of the public.

In light of the ruling of the European Court of Justice in favour of the Chen family earlier this week, the Minister for Justice, Equality and Law Reform needs to take immediate action in line with that judgment to allow the non-national parents of approximately 11,000 Irish children to remain in this State, given the numbers of people involved and the harrowing reality they have had to face as a result of this decision. I have met parents and children among this number. What they are going through, the suffering they are facing, the limbo in which they live both physically and psychologically, is very distressing.

The Council of Europe states that its work in the field of migration focuses on the reasons for migratory movements, migrants' legal status and on integrating migrant and refugee populations. The Council states that its policies lay stress on improving community relations, encouraging tolerance and guaranteeing migrants' social rights. These are policies that should inform the work of the development bank. The difficulty is that the work now takes place in the context of "fortress Europe".

It is not the Council of Europe but the European Union which determines immigration policy in Europe, regrettably increasingly so. The European Council on Refugees and Exiles, which represents 76 refugee assisting organisations throughout Europe, Amnesty International and Human Rights Watch have all expressed their deep concern at the agreement last April by the EU Justice and Home Affairs Council of several asylum measures that would allow the denial of protections for refugees in the European Union and are in breach of international law. The draft directive on asylum procedures is in breach of the commitments of the European Union as set out in the Charter of Fundamental Rights of the European Union and violates individual member states' legal obligations under international refugee and human rights law.

This is the context in which the Council of Europe Development Bank will work. Any expansion of its role to address the social and economic consequences of inward migration will happen within the Fortress Europe reality and all that entails. The European Anti Poverty Network points out that there are some 68 million people on the Continent of Europe who are experiencing poverty. The work of the development bank will address only a very small fraction of the needs of that number.

The eradication of poverty must be at the heart of the European Union. That is not the case at present. The interests of multinational capital have been placed ahead of social need. There are two types of project for which the bank will provide loans. They are, first, building low-cost housing and, second, providing social infrastructures in the fields of health, education, environmental protection — sewage and refuse treatment plants and so on — rural modernisation and the protection and rehabilitation of the historic heritage. These two points should definitely interest communities in this country, given the failure of this Government to provide adequately to meet the demand for local authority housing, and its inadequate provision for social infrastructure and health and environmental protection. I hope this and future Governments will be presented for their endorsement with applications to the bank for grants to support housing, health, educational and environmental projects. I would say without question that I look forward to seeing those applications going forward and, it is hoped, receiving every assistance.

The work of the Council of Europe on behalf of the Continent's Roma, Gypsy and Traveller people should be acknowledged. The Council states:

It is helping member states to improve the situation of Europe's Roma/Gypsy minorities. It emphasises two essentials — the need for comprehensive national and local policies and the need to involve the Roma/Gypsy communities in drafting them and putting them into action.

The council should be invited to Ireland, in the first instance to speak to the decent and deserving Traveller community at Dunsink Lane in the wake of the disgraceful and illegal blockade of that community. It echoes the worst ravages visited on the Traveller community throughout Europe. This country's record is not one of which we should be proud. There is much to be ashamed of, as has been demonstrated in the recent past. I support the Bill and urge its speedy implementation.

Mr. Hogan

I congratulate and wish Deputy Treacy well on his appointment as Minister of State at the Department of the Taoiseach and the Department of Foreign Affairs. This uncontentious Bill, supported by the Fine Gael Party, seeks the approval of the Oireachtas for the terms and conditions of Ireland's membership of the Council of Europe Development Bank. It is part of the Government's strategy to join a number of development banks, as recommended in the 2002 report of the Ireland Aid review committee. The Council of Europe Development Bank was established in 1956 but only now has received publicity in Ireland. Membership will allow it to grant financial aid to various social and vocational projects in this jurisdiction. It is a multilateral development bank under the supreme authority of the Council of Europe, with its own legal status and financial autonomy.

The Bill allows us to reflect on the objectives of the bank. Its first objective is to strengthen social cohesion and integration. In doing so, it has provided financial assistance for refugees, migrants and displaced populations. It has also given assistance to social housing measures, job creation, disadvantaged urban areas and rural modernisation and the preservation of small businesses through assistance towards vocational training.

Social cohesion is a serious issue in Ireland. Recent policy changes have widened the gap between rich and poor and removed policy instruments that were of considerable assistance to community groups contributing to the economy at local and national level. The Minister must take on board the effects of the changes to the community employment scheme. These schemes offered vocational opportunities to many people who would not normally have been able to enter the mainstream workforce. In turn, those people contributed to health and resource centres, local community committees and environmental protection and enhancement. The Minister of State, Deputy Treacy, is aware of the representations made to Members on this matter. I hope the new Minister for Enterprise, Trade and Employment will not follow his predecessor in setting up another investigating group on the matter. We are past the stage of internal review and the external review conducted by FÁS. Changes must be made to allow communities to benefit from the good work of these schemes. The schemes have done much for social cohesion at community level. Policy changes at political level are now needed to ensure the continuation of this work.

I do not understand the cuts made in the back to work, back to employment and supplementary welfare allowances. The latter has changed so much that it is near impossible to qualify for it in housing assistance. To waste six months on the housing list until one gets the necessary qualification for supplementary welfare allowance is nonsensical. It costs the State more money to provide a house for individuals such as single parents who, through the previous supplementary welfare allowance, were able to benefit from housing in the private market. This money-saving cut in the Department of Social and Family Affairs is a retrograde step. The Ministers for Social and Family Affairs and Finance must redress this retrograde decision in the forthcoming budget. These changes to policy instruments are not contributing to strengthening social integration.

When modernising an economy, it is not about where the money comes from but how it is spent. Ireland has been fortunate to be the beneficiary of an enormous level of transfers from the EU not only in terms of agriculture, infrastructural development and social funds, but also human capital, education, environment, health care and social integration. The Fine Gael Party, as a strong supporter of European co-operation and cohesion, has always supported drawing down these funds. However, accountability in how the moneys were spent, particularly the infrastructure funds, could have been better. The transnational networks in the infrastructure programmes were to allow greater access for Ireland to the European mainland. However, the implementation of the national development plan in establishing these networks has been delayed and subject to budgetary overruns, leaving much to be desired. Controls on the expenditure of this money to ensure best value for money are required. The EU transfers to Irish agriculture, institutes of technology and infrastructure have greatly contributed to our economic growth. However, the EU cannot be blamed for the manner in which some of the funds have been misspent.

The European Bank of Reconstruction has also played a significant part in the development of the economy. A former Member, Mr. Des O'Malley, is now an eminent member of the bank's board. He follows in the footsteps of Tony Brown and Brian Hillery, both of whom contributed towards developing this banking institution for European development.

The Minister of State gave examples of how moneys were spent in various countries. I noted that €11 million was approved in financing projects for restructuring the health sector in Bulgaria. While there is enough money in the Irish health sector, it is how it is spent that matters. If there is a need for additional resources, funds are available from the bank for restructuring accident and emergency departments. Examples of the bank's focus on human capital include the elimination of unemployment blackspots in Germany, the reconstruction of areas in Hungary, Lithuania, Poland and Slovenia after natural disasters, the renovation of schools in Spain and the provision of aid to Turkey after the 1999 earthquake.

Another area in which the bank made a major contribution was in providing aid to Turkey following its disastrous earthquake in 1999. That was an important step. Whatever we think about the ultimate accession of Turkey into the modern democratic European framework, its strategic location is an important factor. In addition to the political structures of a country, these funds contribute towards ensuring greater co-operation between the various civilisations and between the member states of the European Union and their neighbours.

The recent statement by the Minister of State at the Department of Foreign Affairs, Deputy Conor Lenihan, to Deputy Michael D. Higgins and others at the Joint Committee on Foreign Affairs is indicative of the manner in which the country has drifted in its responsibilities on overseas development aid. I pay particular tribute to my colleague, the former Minister, Deputy Michael D. Higgins, who is present in the House, who has continued to highlight this matter. Ministers of State at the Department of Foreign Affairs have increased the overseas development aid fund over the years. By making such an admission, practically within a week of being in office, the Minister of State, Deputy Conor Lenihan, has considerably set back the position and allowed the mandarins in the Department of Finance in Merrion Street to have an open goal, so to speak, in terms of not meeting our objective of 0.7% of gross national product by 2007. It is bad strategy from a line Department to inform the Department of Finance this near to the budget and Estimates process that there is no need to give it any more money as it will not meet the target. It was a political mistake and I hope the Taoiseach, the Minister for Finance, and the Minister of State, Deputy Treacy, who is present, will ensure our target is met, as the Taoiseach promised when he campaigned for a seat on the Security Council of the United Nations.

It is a major embarrassment for the Government and the country to have the Minister of State, Deputy Conor Lenihan, make such a serious error of judgment so soon in his term of office. He needs to be corralled to a greater degree in future to prevent him from further damaging the reputation of this country. At a time of great wealth, there is a moral imperative to help people throughout the world who are less well off, especially in debt issues in the developing world.

The Bill will impact on Ireland's development and national competitiveness in terms of the funding it may draw down from the bank. The National Competitiveness Council's recent statement on prices and costs confirm what my party and I have been saying for some time, that the real culprit in rip-off Ireland is the Government. It was responsible for 44% of consumer price inflation between 1999 and 2004.

In a recent newspaper article, the eminent economist, Mr. Brendan Keenan, of the Irish Independent, who is regarded by himself and others as the doyen of economic commentators, argued that this price was worth paying because the choice was between stealth taxes and taxes on labour and the latter led to unemployment. He also argued that the rise in prices does not appear to have affected competitiveness in the economy which was enjoying growth rates which were the envy of Europe. Mr. Keenan is one of the most astute economic analysts in the country but I think he has got it wrong on this one.

According to the recent enterprise strategy report, which was the Government's think tank document on industrial policy, public sector expenditure in the five years up to 2003 rose by a staggering 90% to €36.7 billion, including net pay costs of €12.5 billion for 335,800 staff employed in 572 Departments and agencies. The bulk of this growth occurred in the two years prior to the previous general election as the Government bought the election not once but twice because of the outbreak of foot and mouth disease. I might have missed something but I cannot see that public services are 90% better off as a result of this expenditure. There has been some improvement but not nearly enough to match the growth in expenditure.

I do not agree with Mr. Keenan that one can have a trade-off between employment and stealth taxes. We are pricing ourselves out of the market in many respects. We are rapidly sliding down the world competitiveness league and are one of the most expensive countries in the European Union. We cannot allow that situation to continue. If we draw down money from a source such as the Council of Europe Development Bank, we must ensure our prices and costs are in line with our competitors and that we get better value for money.

I wish the former Minister for Finance, Deputy McCreevy, all the best in his new job as Commissioner for the Internal Market and services. He has an important contribution to make to consumer issues. We will not be true Europeans in economic terms unless we have a single European Union market. The new Commissioner can implement Internal Market policies that can transcend frontiers so that Irish consumers can benefit from market opportunities and product prices throughout the European Union. That would allow for greater competition for many products and services in this country, which is the only way. We are a small country with a population equivalent to Manchester, so we will not be able to do it ourselves. We will need the market support and policy instrument support from the Internal Market and services Commissioner to achieve the consumer choice and opportunities that are essential.

I welcome the Bill and the Fine Gael Party supports it. As legislation goes, it is not earth shattering but I hope it will provide for opportunities through this bank to give greater benefit to people and countries that need our support more than ever. It will also benefit co-operation within Europe and between Europe and the developing world. The Government has missed a great opportunity to meet our objectives politically and financially to assist developing neighbours to a greater extent at a time of great wealth. We must never forget those who are less well off than us.

Dr. Twomey

Fine Gael fully supports the Bill that will see Ireland gain membership of the Council of Europe Development Bank. The bank describes itself as having an exclusively social function. It participates in the financing of social projects, responding to emergency situations and, I hope, improving the lives, living conditions and social cohesion in less advantaged regions throughout Europe.

A previous speaker alluded to the fact that we are only now seeking membership of the bank, which may relate to the fact that we were underdeveloped ourselves. It is a recognition of how far we have come that we are now prepared to make some contribution to a bank that wants to help others throughout Europe and further afield.

The legislation may not be very interesting or exciting in some respects, but a great deal can be learned from it. We could learn some lessons ourselves in regard to what we are doing and how we intend to move forward. The lessons can be learned not alone by the new accession countries which are more socially deprived than the countries of old Europe, but also by the wealthiest European countries which, although they are more industrialised and probably have greater social inclusion, still have a significant degree of disadvantage.

The bank operates under three main headings as defined in its articles of agreement and the resolution of the administrative council. These are strengthening social integration, managing the environment, and developing human capital. We should apply these goals to ourselves. Under the sub-headings on strengthening social integration, there is a reference to aid to refugees, migrants and displaced populations. We now make a contribution to a bank in Europe that seeks to assist refugees in crisis, migrant workers and displaced populations. However, this is something which we have yet to address properly.

Our attitude towards migrant workers certainly needs to be changed. Policy needs to be much clearer on how to deal with migrant workers, especially since they will be in the mainstream of the economy in years to come.

I tabled a question to the Minister for Justice, Equality and Law Reform concerning a family in County Wexford I have been asked to deal with. It is a rather strange case but it illustrates where we are going. A Bulgarian man and his wife and child came to Ireland in December 1999. If he had been fortunate enough to have arrived in July 1999, he would have been eligible to get a work permit by now and could have worked as a truck driver, the occupation he had in Bulgaria. Instead, he has been kept on social welfare for the past five years, because of the rules and regulations. In the meantime, his boy has gone through the school system in this country. That child is now 11 years old, speaks fluent English and probably finds it difficult to speak Bulgarian. The family also has an 18 month old girl who is an Irish citizen. They have been issued with a deportation order for 14 November. They appealed a previous deportation order, but this is the final one. Despite this, Bulgaria will be part of the EU within two years, so this family could return quite legitimately. We are spending large resources to deport people who could return legitimately within a short period. This type of situation also occurred prior to the ten new countries joining the EU. However, what is significant in this case is the degree of disruption involved for this family, especially the 11 year old boy, whose life will be destroyed. He has no idea what it is like to live in Bulgaria. He has forgotten what it is like, yet he will have to return to this country at the expense of the State and then, perhaps, return again in two years' time.

We need to tidy this up. There has been a change in the Constitution in the past six months which we have not followed up regarding where we are going on the question of refugees, migrant workers and displaced populations. Let us examine ourselves now that we have this opportunity to see what is happening. Another aspect to strengthening social integration is social housing, job creation and preservation in small and medium-sized industries and vocational training. Some movement has taken place in terms of social housing, but it is still not good enough. Although figures are being thrown out all the time about 80,000 houses being built etc., it is always the total figure that is given. We never get the figure pertaining to the Government's role in the provision of social housing. There is a long way to go in this regard.

Vocational training and small and medium-sized industries are sectors that feel neglected. They do not believe their voices are being heard. Even though there is an Oireachtas Joint Committee on Enterprise and Small Business, many of these organisations do not feel they get the assistance from Government they deserve. Neither do they feel the Government listens to their views or that it is overly committed to indigenous industries. We appear to have got carried away with the bright lights of multinationalism and focus all our attention on the transnational companies that come into this country. They have made a fantastic contribution to the economy, but I believe we should focus more on the small and medium industries, let their voices be heard and do something to relieve their concerns. That is not happening.

The final sector on strengthening social integration, as discussed by this bank, is disadvantaged urban areas and rural modernisation. Whatever we may say about the other categories, in this respect we have totally failed. Disadvantaged urban areas, which are supposed to be covered by the RAPID programme, have simply not worked. Much work remains to be done. The lack of investment in this regard is enormous. The idea of RAPID was not just to create jobs, but also review the health and education services and everything to do with people's lives. No Minister, no matter how good he or she is, can defend the neglect that has occurred in the RAPID regions. A great amount of work remains to be done on all aspects of this programme. We really have failed in this area and it is indefensible.

The next section relates to management of the environment. Whereas the bank looks at natural and ecological disasters and preventative action, these are events that occur over which we may not have much control. There are reasons for flash flooding, perhaps to do with global warming or whatever, but such events happen. There are matters over which we have control, however, and steps that may be taken to protect the environment, for example the preservation of the historical and cultural heritage of the country. In our quest to move forward, this is, perhaps, an area we have forgotten. Sometimes we have disregarded important aspects of our heritage. I refer not just to bypasses through old historical sites, but the deliberate destruction of parts of our heritage. We have demolished old buildings and castles, and allowed planning to take place next to an historical building which has utterly destroyed its character. We seem to have ridden roughshod over this area for many years. We no longer appear to have a feel for our cultural heritage.

The protection of the environment and our heritage can go hand in hand with economic development. I want to stop the destruction of our culture for the sake of making an extra few euro for some developer or speculator. There are many examples where people have been allowed to destroy the heritage of the next generation purely for short-term gain and so that someone might make millions of euro on speculation and development.

The final section asserts that the most important aspect of the bank's work is the development of human capital. That is a lesson we could learn in this country because this looks at education and health. What made this country the Celtic tiger were the developments in health and education over the past 30 years. Mine was the first generation of my family to receive a third level education. Many other families were in a similar situation. There was an aggressive move to make secondary education free and to make Ireland educationally aware. It took 15 to 20 years for the fruits of that initiative to mature. We had a large young well educated population which was able to tap into the economic changes that were taking place. That is what made this country great and led to its development. This was planned years before and when it came to fruition, we were able to work to best advantage.

I do not believe, however, the Government can deny that in the process of getting rich, it has a policy merely of lowering taxes and giving people money. In the process, it has neglected and forgotten what made the country great in the first place. If we curtail investment in education now, we will reap the fruits of that mistake in 15 years' time. It is already happening. We are currently having meetings with regard to one of the community schools, at Gorey in north County Wexford which now has 1,600 pupils, although it was designed for 900. A number of local national schools feed into this school. There is one other major second level school in that part of north County Wexford in Kilmuckridge. They have been promised a new building for seven or eight years. As meetings take place and deputations seek extra space, more classrooms etc. in respect of the Gorey school, at this stage what will be required is a new national school. Nothing has happened. Everybody is referred back to the schools list. National schools in the area are concerned because they are being told their pupils might not be allowed to register at the community school because of quotas and other restrictions. This is something that has just been allowed to happen. In some respects the same could be said about the accident and emergency crisis in hospitals.

There is no great science behind the accident and emergency crisis. It has come about because people are drifting into accident and emergency departments and patients cannot get out of them. When primary care is let run down, public health nurses are not taken care of and the numbers of general practitioners per patient in deprived areas is not monitored, there is an inevitable drift to the accident and emergency departments. It is a question of access. If people who cannot get access to a general practitioner want to see a doctor, they will go to the accident and emergency department. In allowing primary care to fall apart, so to speak, we now have a crisis in accident and emergency departments.

The other aspect of the accident and emergency problem is getting sick people from accident and emergency departments into hospital wards. Over the past 20 years, approximately 3,000 beds were closed in our hospital system. Beds were removed and wards closed for financial and economic reasons, but when our economy returned to its wealthy state, we were very slow in making these investments. The health strategy was published in 2001. The Minister said he would provide for 3,000 beds to be put back into the system over a number of years. On Tuesday, the Taoiseach mentioned figures of 500, 700 and 900, but figures are being picked out of the air. The capacity of the hospitals cannot cope with the number of patients requiring treatment.

One of the solutions proposed to deal with this crisis was to transfer all those patients who need convalescence and step-down facilities. They should have been taken into facilities other than hospitals. The point was made that a bed in an acute hospital costs €5,000 per week to maintain. A nursing home bed costs approximately €600 to €900, depending on the area, but the health boards appear to take the view that there is little point paying €900 a week for a bed for someone when they still have to pay €5,000. That is why we have a crisis in accident and emergency. Despite all the solutions the Government came up with, including moving long-stay patients into facilities built under public private partnerships, not one bed has been delivered.

That process was meant to provide approximately 600 or 700 beds, which would make a significant difference when one considers that the overrun in terms of patients on trolleys we see constantly now, not just in winter, varies between 150 and 250 per day. We could make a difference, therefore, and not just in terms of those 150 beds but of all the elective procedures that are not being done. Surgery is being cancelled at the last minute. That is wrong and it is something of which the Members of this House should be ashamed. Most of us have probably been lucky enough not to require an operation, but there are people who have prepared themselves mentally for their operation, perhaps even taking medication to prepare, particularly if it is a bowel operation, only to get a telephone call the morning of the procedure to say it has been postponed. They might have to go through that two, three or four times before their procedure is eventually carried out.

The fact that this House has allowed such a situation develop over the past ten years is a disgrace. That should be the mantra of this bank and of any progressive Government. It is not just about money. The people of Ireland will pay the price, regardless of who we are talking about. Sometimes people talk about the vulnerable people in society who always suffer. Some people talk about the middle classes while others talk about the very wealthy. It does not matter who we are talking about. Everybody will suffer because they cannot get proper schools for their children. We cannot keep teachers in the classrooms because the pupils are out of control. That is an area we have neglected. We shrug our shoulders and do not discuss it.

The same argument applies to hospitals. There is a crisis in Crumlin hospital. Nurses come here from other countries to work in our hospitals, some of whom work in Crumlin hospital. Crumlin hospital is described as a tertiary referral centre, in other words, it deals with all the serious operations for the entire country. A nurse who was used to working in a tertiary hospital in another country would think he or she was coming into a state-of-the-art centre. We have seen Irish doctors come back from America and intensive care nurses return from the United Kingdom and Australia, but they think they have come to the wrong place when they arrive in Crumlin.

Doctors in our intensive care unit in Crumlin have to pull the child's cot out from the wall into the middle of the floor to allow the health care team treating that patient access to the cot. The place is so overcrowded the equipment is bunched in between the cots. This is supposed to be a first world country yet this is what we have allowed happen to our health and education services. We should be ashamed of that. Giving lame excuses about what we will do will no longer wash with the people because this problem has been developing slowly over the past six to seven years, the same period the Government has been in power.

I do not agree with the nonsense I have heard since the last reshuffle about how change will come about because the same Cabinet went to Ballymascanlon in 2001, led by the Taoiseach. He walked out of that meeting and said that the health services were well resourced and well funded. He was followed by the then Minister for Finance who said that putting money into health was like pouring money down a black hole. That was the ideology of that Cabinet. Regardless of what the then Minister, Deputy Martin, tried to do, he got no extra funding. In some respects that Minister cannot be exonerated either because he participated in this fooling of the people. He misled the people.

That Cabinet meeting was held in May of that year following which the Government said it had no intention of providing extra funding to the health service yet the health strategy was published in December 2001. The then Minister, Deputy Martin, said at that time that the health services would get an extra €1 billion a year for the next ten years even though the then Minister for Finance, Deputy McCreevy, told him not to publish that report because he would not give extra funding. When the report was published, it became Fianna Fáil health policy for the general election.

The Bill is good for the people of Europe and the five areas which will benefit from it, but we should reflect on what this bank stands for and apply it to ourselves because we have let down the people we are supposed to look after in this regard.

Mr. M. Higgins

I welcome the opportunity of speaking on this Bill. It is perhaps understandable that the reference to the social terms of reference of the bank would encourage people to reflect on social inadequacies and divisions at home.

In responding to the Minister's contribution, the bank, founded in 1956, raises a very interesting question. The bank was founded at a time when the prevailing economic doctrine in Europe was Keynesianism. It is interesting to think of the moment of the foundation of the bank and to reflect on the circumstances that led, for example, to the founding of the Bretton Woods institutions just a decade earlier.

The International Monetary Fund, the World Bank and other institutions were originally development banks that were accountable to the economic and social committee of the United Nations. It is interesting that we are joining this bank in 2004, nearly 50 years after its foundation, but we should use the opportunity to contrast what has happened to the other institutions, that is, the Bretton Woods institutions. In the case of the IMF, it has been completely distorted from any development agenda. Indeed, the poverty reduction strategy was insisted upon by that bank. The World Bank, in a way, had related strategies but there is a significant difference between the IMF and the World Bank. These major United Nations institutions, however, which I emphasise were originally accountable to the Secretary General of the United Nations through the economic and social committee, were development banks with the task of reconstruction and social equity. The IMF, for example, has, in case after case, become oppressive.

I will give an example of that, before turning to the main purpose of the Bill, to set it in context. In the case of Zambia, which is often mentioned and which Members of the Oireachtas visited recently, in 1999, a year for which we have totally acceptable figures, it paid $438.5 million in debt service, which was 13% of gross domestic product. At the same time that 13% of everything produced in the country exceeded what was spent on health and education. The Bretton Woods institutions have moved to a point where they find it perfectly acceptable to require a country to spend more on debt service than it spends on combined health and education expenditure. Put more practically, for every 1% that could have been spent in Zambia on health and education, child mortality would have been reduced by24%. There is a real human consequence to the economic ideology imposed by a particular international bank.

The relevance of this to the Council of Europe Development Bank is that it has a specifically social set of criteria. I recall this being debated when I was a member of the Parliamentary Assembly of the Council of Europe reflecting the circumstances in which it was founded in 1956. The prevailing view on development and reconstruction in Europe at the time was coloured by what might be called the 40 glorious years of Keynesianism which led to the reconstruction and development of Europe. The years since the 1980s and the assertion of the neo-liberal classical model, with its very narrow focus and no social agenda, are the horrific 20 years, characterised by a version of the disembodied economy.

I congratulate the Minister of State on his appointment and wish him well. Many Europeans, and his colleagues looking through European glasses, accept that the rest of the developing world should not benefit from the 40 years of Keynesianism they experienced. The poverty reduction strategies on which the International Monetary Fund has insisted for a long time are deadly, narrow-minded and based on poorly informed economic thinking. I strongly advise the Minister of State to rely on the United Nations Economic Commission for Europe in Geneva, rather than on many of the other sources of economic data that will be provided to him in his European mission, and in relations between Europe and the rest of the world.

As an example of the latter's unreliability, the IMF subsidised and brought into existence the Russian mafia. It wasted world resources in propping up Yeltsin. On the evidence of the documents covering that inglorious period it would have spent anything to keep its particular person in power. That was one of its worst days. People should not accept my view, they can read the view of Joseph Sitglitz, a former executive at the World Bank and Nobel economics laureate. At the same time the IMF was imposing restrictions on other loans.

The United Nations Economic Commission for Europe, through its Geneva office, did the best work on the Russian transition but it was excluded from the thinking of many people advising European governments. It was rarely used, and rarely quoted by any minister in Europe and neglected at great cost. The work was undertaken by impeccable economists whereas the work that was accepted as an alternative was shallow and not submitted to international academic refereeing in most cases, as the UN work is. When I began my career as a university teacher we were free to speak about alternative economic models of development. The difference between the 1970s and the present is that we are in the grip of a tyranny which imposes a single economic model on the poorest of the poor. This brings the human consequences I have mentioned in the case of Zambia where life expectancy in 2000 was 33 years, having fallen from 43 years, mainly due to the impact of HIV-AIDS.

We are called morally to account on our commitment to the millennium development goals, the Monterrey goals, repeated in Johannesburg, and in successive documents. The world millennium development goals are far off track, as many international experts have pointed out when looking at the present figures. We are approximately 40% short on the HIV-AIDS package of €2.5 billion. We are in the last decade for the most urgent goals which are to be achieved by 2015. This is interesting in the general context of the deadly philosophy that informs the IMF, in particular in the case of the least developed countries. In some of those countries to which a market model has been suggested, followed up usually by good governance and all the other criteria, the average per capita income is 72 cents, of which private consumption is 54 cents, leaving 18 cents per capita for people who are functioning according to a neo-liberal economic model. It is outrageous to persist with this thinking.

This Bill is very important. It may seem inconsequential or peripheral to some people who might not want to contribute, thinking that it is perfunctory because in practical terms it will cost us just under €4 million and a contribution to reserves. It is important for the social criteria behind its purposes because they remind us how far the Bretton Woods institutions have drifted from their original role as development banks. In terms of the overall Government strategy of joining the other regional and development banks in Africa and Asia it is important to apply a philosophy that will enable the new restructured debt requirement of a country to be calculated, separate from and after, it has met its health education budget. This is not a left-right divide. If one did the calculations for the African countries with which I am dealing one would arrive at different figures.

After 50 years of development assistance and 30 years of the partnership concept half of the world's 6 billion people continue to live on less than $2 a day, and approximately 1.2 billion on less than a dollar a day. While I want to stay close to the text of this Bill I must reflect on recent years and the recovery of military spending. I cannot recall off the top of my head the actual figure for military spending but the latest calculation shows that the United States, the largest economy in the world, spends 20 times as much on military and defence expenditure as it does on development. This reflects a philosophy that security is to be defined and achieved in terms of military prowess rather than through the elimination of poverty.

I recall a debate in the assembly of the Council of Europe at which we discussed the relationship between this bank and Europe, particularly eastern and central Europe, and for example, the balance that might be struck between the AAA rating of the bank, and its reputation as one of the oldest banking institutions in Europe. How is that retained and at the same time how can there be the flexibility referred to in the Minister's speech? This is where the bank moves from new projects such as the direct care of migrants and people who are moved for natural disaster and so on. How can the rating be accommodated with flexibility? It is interesting that the bank has discussed this, as is the geographical spread of the projects that have been approved. Some people have raised the question as to whether the capacity to prepare an application and draw down the money is responsible for the over-representation of projects in some countries rather than others. Some of the newer countries preparing applications have made this point.

The Minister also referred in his speech to the care of refugees, migrants and migrant labour. It is time we became clear on a number of fundamentals. Is the migrant worker, the refugee or someone who arrives in this country, entitled to the full range of rights that we accord any other person by virtue of the fact that they are alive, or is there a mitigated set of rights? I have had a long correspondence over the past couple of years with the Department of Justice, Equality and Law Reform on the full implementation of those rights which the Council of Europe has accorded migrant workers. I asked questions on where precisely these rights were to be vindicated in Irish law.

I feel morally required to say that I am deeply saddened by what is said of us in the recent referendum, when on the basis of 230 babies born in Dublin hospitals, the Constitution of Ireland had to be changed to change the principles of citizenship. I accepted the results of the people in the referendum, but I feel ashamed by it. It contradicts much of the rhetoric about universalism, human rights, workers and the whole question of the changed nature of the inter-cultural society which will be created.

There was misery associated with it that is not dissociated from the same miserable, narrow model of the economy. The model of the economy that is being prosecuted is one which I call the disembodied economy, where we are regularly invited to be loyal to the economy rather than to society. We have replaced concepts of citizenship, with its related entitlements of universal provision, by consumerism. By that I mean that we should come clean on social inclusion and so forth.

I wish the Minister well. I have some hopes on what he will do regarding the contradiction that is at the heart of the Lisbon accord. That contradiction is structured as follows. The Lisbon accord refers to creating one of the most competitive, economic entities in the global economy. At the same time, it makes the case for social cohesion, the elimination of inequality and achieving full participation. It is the latter that is important because social cohesion, which is at the heart of the terms of reference of this measure today, is entirely damaged by what is accepted as the prevailing economic model. Is it not an aspiration to which all Europeans might subscribe, that every child has the right to development and education?

Education, contrary to the assertion of the OECD, is not a commodity to be purchased. The global report of the OECD on education has a great phrase in it, quoting someone who stated that education is the next big thing for private investment. In its previous publication, it stated that water was the biggest new commodity globally. Thus, poor black South Africans and poor blacks in California share the same water provision by a private French company. That is social exclusion and that is the imposition of the model with which I began, the notion that the economy is separate from people, that one version of the economy, the neo-liberal market driven economy, which makes a private return to an ever-increasing horde of private shareholders, is the notion with which we must live. That will be disastrous for Europe. It will create and deepen social divisions so that people will define security privately in gated communities. They will look for more people to protect them on the streets through restricted public order legislation. They will exclude thousands of people.

When we turn to where this bank began and look at its projects across eastern and central Europe and in Italy, no one has any difficulty about the speed with which people should respond to the disaster. I find it really difficult to note the cultural differences that arise in the ability to respond. How many in Parliaments in Europe debated the condition in Haiti? Was it a case that somehow the people on that small island are lesser and out of control and therefore nothing could be done? It is very important to be able to respond to disasters. In the case of natural disasters, this bank has responded and everyone welcomes that.

Is it not extraordinary that we will all give speeches on social housing and how housing shortages might be met, when less than 100 social housing units were completed last year? We live in a society where the notion of ever having a house has evolved into mortgage slavery, in which we have conscripted both partners into the economy and have begun suggesting to people that they must not retire short of 70 or they are guilty of being disloyal to the economy. We have not delivered what was promised by the Government in local authority housing, suggesting that we all exist to be a kind of fodder for a speculative roll in housing. I hope that many communities which are facing what has been visited upon them regarding shelter will write directly to the bank, begin preparing their own projects and apply for long-term socially based loans which are possible.

I am delighted to have had this opportunity to speak on this matter. We will not make progress in this House until we have consistency between what is pledged regarding matters such as contributing 0.7% of GNP in ODA by 2007 and until we have full accountability in here about what is said in our name at the IMF and the World Bank and in the different international agencies.

Dr. Cowley

I welcome this Bill as it is a step in the direction that we would help any area to develop. As a country that did so well with EU investment, it is extremely important that we ensure that development takes place. We are all here to do what we can on a national basis and for our own areas. If we are accused of being parochial, it is because these are the areas that we came from and these are the issues that we must address. No one can feel anyone else's pain, but one experiences these problems and is given a strong mandate to represent those issues which have not been represented by the political parties over the years, and that is why there are Independents. It is the people's agenda rather than the parties' agenda.

Mr. F. McGrath

Hear, hear.

Mr. Connaughton

Dream on.

Dr. Cowley

This Bill is part of what this is all about, which is to help the people. The good works done by the development bank are very important. Who would argue against improvements in health care facilities in Bulgaria or the key role in vocational training and the fight against unemployment in Germany, reconstruction after floods in Hungary or aid for refugees and migrants in Lithuania? These are projects that have been helped by this bank.

I would like to inquire about the money we received under the national development plan, which is supposed to ensure balanced regional development. I hope the moneys allocated from all sources are spent on those areas which need it most.

There is no way of knowing where money goes. We do not know how the money given to the new EU member states will be spent, for example. When they were applying to join the EU, we were told that there would be less money for Ireland. We have received money from the EU, but now we have to give it to other countries. I hope the new member states fare better than Ireland as they try to ensure that regional development is balanced.

Like my fellow Independent Deputies, particularly those from the west, I represent a neglected area. There are figures to prove that the north west of County Mayo, west of a line between Killala and Newport, is the most neglected part of Ireland. According to demographic statistics, the population of the area has decreased by thousands of people and will decrease by thousands more. If current trends continue, very few people will be living in the locality by the end of the century. Things are much better in the eastern part of County Mayo.

It behoves those involved in the distribution of funding to ensure that it is allocated where it is most needed. The INDECON mid-term review of the national development plan stated that the BMW region has suffered from the unbalanced distribution of funds. Money has been spent on projects in the east and south of the country, but major spending deficits are found in the west. That lack of balance is a central issue of great concern because balanced regional development is needed. Many ideas are contained in plans such as the national development plan and the national spatial strategy, but the reality is that money has been retained centrally. The centralised political party system has failed because it has ensured that money is spent on the east coast, where the power rests. More Independents will be elected to this House because they represent the people's issues.

Mr. Treacy

The Independent group is shrinking.

Dr. Cowley

The population of my local region is decreasing all the time. More than half of the graduates in the locality will have to go to the Dublin area to look for jobs. Further difficulties will ensue if the population of the Dublin area continues to increase. Alarm bells are ringing in the CSO and other bodies because things are wrong. If Ireland was floating, it would be sinking into the Irish Sea because the Dublin region is so over-populated. When one tries to get in and out of Dublin, one can see that it is chock-a-block with people.

It would make sense for the Government to pursue a policy of balanced regional development. Terrible problems, such as traffic congestion, which are caused by over-population would be solved by such an approach. One cannot get in or out of our capital city because there are so many cars. There is a proposal to build a second terminal at Dublin Airport because there is so much congestion there, but I think it would lead to even more congestion. The necessary infrastructure is not in place to help people to get in and out of Dublin Airport. We have gone backwards to the last century instead of making progress because of a lack of balanced regional development. The fact that traffic in Dublin moves at the pace of the ass and cart is a demonstration of that.

It is time for the Government to adopt a sensible approach and to realise that money needs to be invested in balanced regional development. There is a need for a change of emphasis. I accept there is a similar need for investment in inner city areas, as my Independent colleague, Deputy Finian McGrath, will attest. We all agree that resources need to be targeted at those areas where deficiencies are found. A great deal of money is being invested in transport infrastructure, which is certainly needed by those living in areas of large population. Would it not be better, however, to look towards the future and consider the need for balanced regional development? Such development could ensure that the people of the west, who would prefer to stay in the west in any event, do not have to move to Dublin to congest it even further.

I am in favour of the decentralisation policy. I welcome the decentralisation of a Department to Knock Airport. The effect of that measure will be much smaller, however, than would have been the effect of the moneys which were promised under the national development plan if they had been provided as they should have been. Everything seems to radiate into the capital city, which is the ultimate parasite because it draws everything into it. It feeds into the national funds and ensures that the west continues to decline. I am very concerned about such issues.

Knock Airport is supposed to be an international airport, but it is treated as a regional airport. Although approximately 400,000 people pass through the airport each year, just €5 million has been allocated for its development. A sum of €400 million would have been given to the airport if it was classified as an international airport. Some 20 million pass through Cork and Dublin Airports, which are deemed to be international airports, each year, compared to 400,000 people at Knock Airport. Is it any wonder there is congestion at Dublin Airport and that a second terminal is needed there? Would it not make more sense to continue to support Knock Airport in a much more fundamental way? The money it is being given at present is peanuts compared to what it should receive if we are to provide for balanced regional development.

I favour anything that will help those in the new EU member states who need our help, but it is said that charity begins at home. Ireland would be much more efficient and effective as a nation and its people would have a much better quality of life if people did not have to travel to and from work at the pace of an ass and cart. A monotonous conveyor belt of people who live to work can be seen on the road before the sun rises each day. They endure terrible traffic congestion and sit for hours in traffic on jam-packed highways to get to their offices. They then have to try to get out of work as early as they can to avoid the terrible rush hour in the evenings. It does not make sense.

I appreciate that the Council of Europe Development Bank has been very helpful. I would like to speak about flooding in Pullathomas in the west, however. The Department of Agriculture and Food has not provided the funding which was needed to ensure that the communities which were decimated were given the compensation they deserved. The idea of balanced regional development is important for the future of this nation. This legislation will be seen as very positive if it can help that process in any way.

The development bank plays an important role in the promotion of social housing. Everybody acknowledges that we have a lack of such housing. Although social housing targets are set, the amount of money provided is insufficient to meet them, which does not make sense. Social housing is a wonderful way of allowing the community to be part of the process. Too much lip service is paid to the role of communities, which can do things very well. Housing is provided by organisations such as local authorities and voluntary housing associations. There can be great jealousy in some local authorities, but not in all local authorities as some of them are very proactive. It is totally ridiculous and utterly unacceptable that some jealous local authorities are engaging in competition for building land. A scheme has been established to help community housing associations to borrow from the National Building Agency, but the associations do not yet have the means to do so because a way of overcoming EU competition rules has to be worked out. Such schemes make a substantial difference.

As we discuss the help given by the Council of Europe Development Bank to the new EU member states, we should consider further important steps that need to be taken. Sorting out the NBA to allow it to lend to voluntary housing associations would make a major difference, as would supporting older people in their own communities. Voluntary housing has a major role to play, including sheltered housing for people who wish to stay in their own areas. No one wants to leave, but they must do so because there is nothing for them. People must go to hospitals and non-community nursing homes. There is nothing wrong with those essential services, but in the absence of something in the community, people do not have the choice of remaining. A certain percentage of people in nursing homes would not have to be there if there were something for them in their communities, such as sheltered housing.

Being able to borrow from the NBA would be a means of ensuring that communities could care for older people in this way. It would be important and of major benefit to the community, something that we have proven in St. Brendan's village in Mulranny, which is the largest local employer. That can also extend to higher supports so that there is a guarantee that, no matter how old or disabled someone is, he or she may stay in the community. There is no earthly reason for that not to happen. The support is in place for profit-driven, non-community nursing homes, and that is only right in the absence of anything else. However, there should be the alternative of support in the community.

There must be solidarity with Europe through such banks which can certainly assist our new neighbours in the EU. If we are good for ourselves, we can be good for everyone else. The wealth of this country is substantial. The Minister said that we are the second-richest country in Europe in gross domestic product terms. Ireland has enjoyed significant benefits from the EU, but the west has not had that and the proof exists for it. I do not moan about it but offer solutions and say how matters might be improved. It is not too late to address the balance in whatever way that can be done. The bank has refugees and asylum seekers. Under the Rome agreement, people are being taken back to the UK if they made an original application in Britain. That situation causes terrible human hardship. I know that the bank will examine the assistance of refugees and programmes that can benefit them.

However, here is another example of charity beginning at home. A Burundian Hutu lady was deported in July, having come from England, stayed here for several months and been integrated into the community. She was deported back to the UK in darkness by the immigration unit. They were certainly within the law to do so, but the way they did it was to give her one hour's notice to pack her bags. They arrived to bundle her and her two children, aged five and seven, off to the UK. They were taken with strangers on a journey to Dublin lasting four and a half hours. Then she was taken on a flight in the middle of the night to land in the anonymous and lonely Heathrow Airport where she was questioned and processed.

These cases involve people. We can discuss the wonderful things we can do for people in the Third World, and there is no reason for us not to do them. We should definitely do them for the accession countries. However, we must not forget our people and what happens in this country. Sometimes we can be blind to such matters. When the money is in place, we must ensure that we know where it is spent. Where has the money we received from Europe been spent and what value has resulted from it? Has it simply perpetuated a problem of congestion in one part of the country and the depopulation of another area? That it does not make sense is obvious to a blind man, and it is time to rectify that.

We could do a great deal for ourselves if we examined how our programmes operate, and this is a key example. We are also the only country in Europe that does not have a helicopter emergency medical service. Back in April, a report was published. There is great North-South co-operation now, and yesterday we played host to Dr. Kieran Deeny, the Northern MLA, who spoke to the Independents in the Dáil about working on a North-South basis. The Independents are the only group North and South except for Sinn Féin with a North-South president and who actively work to improve the working relationship in future. As an alliance or coalition of Independents, we would be able to bring the people's agenda to the fore North and South.

The helicopter emergency medical service is a good example. I have met successive Ministers for Health and Children going back to Deputy Noonan. I met the former Minister, Deputy Martin, and the Northern Minister of Health, Social Services and Public Safety, Bairbre de Brún, at a meeting of the North-South emergency care body in Newry, which recommended to the North-South Ministerial Council that a study be done. That was completed in 2002 but not published until 2004. Since April, there has been no movement on it, even though the helicopter emergency medical service is essential. Unsafe practices are current regarding the transfer of people between hospitals. That should and need not happen since it costs lives and causes people to end up in wheelchairs. As a general practitioner, I know of people through colleagues who are disabled for life and are now in wheelchairs because of the lack of such a service.

It is obvious that things happen that are not right. Even in the accident and emergency departments of hospitals there has been mismanagement of funds. There is no black hole in health and there never was. Saying that the money invested in health care was unnecessary is a smokescreen. It is only now that we are achieving the spending levels seen in other countries. There is no black hole and we must continue the investment in health. It was because of the lack of investment and 3,000 beds being removed from the system that we are in the current mess in accident and emergency departments.

The way to solve this is to put beds back into the system. Some 1,000 should be put back immediately, thus putting some capacity back into the system. We are all in favour of money being spent properly. Many reports have been written on how matters should be reformed, but it should not be at the expense of local services, as seems to have been proposed. It was interesting to listen to Dr. Kieran Deeny, the Northern MLA, who spoke about the same centralising agenda. He spoke of the Hayes report while we are speaking of the Hanly report in the South. They are two sides of the same coin. There is an agenda to force people into the unbalanced development of this country which will create a situation where everything must happen at the centre while the periphery suffers as a result. We cannot tolerate that.

Mr. Treacy

What about the working time directive?

Dr. Cowley

The Minister has missed the deadline on that directive. The 58-hour limit by July has already passed. The Government has already failed on the Hanly report and should admit that it is, as I said on day one, a dead duck that should long ago have been confined to the dustbin, something that I hope will yet happen. I am all for more consultants being part of the service, but the Hanly report is a step too far and will not be tolerated.

I support the Bill and hope that there will be more balanced regional development, because charity begins at home.

Mr. Connaughton

I welcome my parliamentary colleague. I have no doubt that he will do extremely well in his new brief. We regret that he will be often absent from the constituency and hope he will try to call back on the odd occasion. The Minister of State has an important position, and I wish him well.

This is an important Bill. There has been a great deal of repetition in the debate. For many reasons, it appears a unanimous choice that the House pass this Bill. It is doubtful if one will find a political party in any parliament as pro-European as Fine Gael. We are certainly delighted that we have more representation in the European Parliament than any other party.

Mr. Treacy

At present.

Mr. Connaughton

At present and for the first time. No one would deny the achievement. Even the Minister of State will agree it was a great achievement.

Mr. Treacy

It was.

Mr. Connaughton

There are five Fine Gael MEPs. That is a long way from two, but good luck to them too.

An Leas-Cheann Comhairle

Yes, and a long way from the Bill.

Mr. Connaughton

It has to do with European development.

It is important that we are associated with this type of development. As the Minister of State is aware, not all development in Europe over the past 25 years has been as good as we would have liked. I have always believed in the concept of European integration as a means of ensuring that everyone in the European zone is treated with dignity and respect. Unfortunately, with all great movements there are glitches along the way. Anything to do with money, finance, investment and so on eventually impinges positively or negatively on the lives of all concerned. That is why this Bill, though not a major one, is important. It is important that the social vocation, the system of ensuring that the European economy is driven not solely by hard economics, is built in, particularly to a bank.

I have been as involved as anyone else in this House in regional development over the years, inside and outside politics. Though this has nothing to do with any particular shade of government, I sometimes find that the greatest enemy of regional development projects is national government. Because of the pressures on government, the situation is often like that of feeding the child who cries loudest. It is a fact of life that one tends to get the greatest investment in areas of greatest population, but as has been said many times in this House it is important that there is balance. We have not been particularly good at this and there are opportunities for a more caring and balanced approach to the investment programmes in many areas. That is why I am pleased to see the aims and objectives of this bank. I might not often agree with Senator Michael D. Higgins, but while the International Monetary Fund has come to the aid of many ailing countries it is true that countries are sometimes left poorer than they were before the involvement of the IMF. There are other aspects which we do not have time to deal with today.

As far as Ireland is concerned, I hope we will play our part in the development of Europe and in the developing countries. Many speakers referred to overseas development aid. The Minister of State will be aware of a message which he and I got this morning from an ordinary constituent of ours in Galway East. It is likely that many people share this lady's views, but they do not all go to the trouble that she went to in contacting all her public representatives in Galway East. A commitment has been given that we would reach a contribution figure of 0.7% of GNP by 2007. This very intelligent housewife said that it appeared that in 2002 the figure was 0.043%, and that in 2003 it was 0.04%, indicating a reduction. I intend to put down a parliamentary question tomorrow to find out the exact figures because if what this lady says is true, the position is worse than I thought.

Mr. Treacy

That question will be answered on Tuesday.

Mr. Connaughton

I would like to get a copy of the answer. If those figures are correct I will be very disappointed. As the figures stand, we have only gone 60% of the way towards the promised contribution.

When the Taoiseach went on his worldwide tour to ensure Ireland got a seat on the UN Security Council, he quoted the overseas aid contribution figure of 0.7% of GNP because he knew the people of Ireland would be behind him. It is very important that when we give a commitment on a world scale, we stick to it. This is one of the big hurdles which the Minister of State will have to jump.

An important aspect of this Bill, to which the Minister of State might refer in his summary, is the direct relationship between the Government and every other government involved as a contributor to the bank. Is the disbursement of funds from the bank by way of all the various activities to be done on a government to bank basis, an individual to bank basis or on a regional development basis? Many people listening to this debate will want to know the position regarding social housing, for example, on which this Government has a particularly bad record. One only has to look at the numbers of people on housing lists, which have never been higher, at a time when we are better off than ever. Will the funds be drawn down by local authorities, individuals, housing co-ops, or will they be allotted on a national government basis? If it is left to national government, the same carry-on will continue.

Since Ireland's accession to what was then the EEC in 1973, the difference has widened between the prosperous areas as they then were at the heart of Europe and the peripheral areas. The evidence can be seen in graphs. The richer areas seem to be getting richer and the poorer areas poorer.

The Objective One status region will be a matter of great concern for the Minister of State, for myself, for Deputy Cowley and everyone else in the west. That status has been very important for the west and it would be disastrous if we were to lose it because if one has it, one is eligible in other ways. The same holds true for the Council of Europe Development Bank in terms of the technical aspects. The matter of a natural disaster occurring is referred to in the Bill. Will this be evaluated by the national government or can the people who have suffered most in such a disaster apply directly for help to such a bank? Many people want to know the answers to such questions. If this is another funding system with applications accepted only through governments or state departments it will be seen as important in its own way, but ordinary people will feel very far removed from it. I hope the Minister of State will refer to this in his reply.

I return to the question of social housing and disadvantage. If my understanding of the Bill is correct, I expect that peripheral areas, irrespective of whether they are located in the heart of Dublin, Cork, Newbridge, or Gorteen in County Galway——

Mr. Treacy

Lovely places.

Mr. Connaughton

The Minister of State and I have found nothing wrong with them.

Mr. F. McGrath

The Deputy should not forget Tuam.

Mr. Treacy

Tuam is also a great place.

Mr. Connaughton

I recently had the opportunity to speak to the principal of a large urban national school. Considering what happens in small towns such as that to which I refer gives one an opportunity to look through a small window at Irish society and see those who come from disadvantaged homes, those with major disabilities etc. One could argue that in a country as well off as Ireland, all national schools should have its full quota of resource teachers and there should be adequate numbers of duly qualified people to cater for those with disabilities whose parents want them to attend mainstream national schools. However, that is not the case. As the Minister of State is aware, there have been cutbacks in many of these services. I do not know why that is the case. I am sure the Minister of State has received as many representations as me in respect of this matter.

What will the Council of Europe Development Bank Bill and the social strategy which is attached to it mean for Ireland? We sincerely hope that the bank will work extremely well not only throughout Europe but also around the world. Many former Soviet states are becoming members of the bank. I assume many of the countries which are not currently member states of the European Union but which may aspire to membership in the future view the help they will receive from the bank as a forerunner of the assistance they will receive if they join the European Union.

In the light of the state of health of the Exchequer, the annual instalment of €3.283 million is not huge. When we rub shoulders with everyone at this level in Europe and across the world, I hope that we will obtain benefits as well as bestowing them on others.

The Minister of State referred to refugees, migrants etc. I presume that funding will be provided and that this will be targeted at the welfare and well-being of refugees. I also presume that this funding will be specific in nature and will be capable of being drawn down. As stated, I am not sure who will draw down the funding.

The Minister of State also referred to the forced movement of populations. One of the great things about the Treaty of Rome is that it laid down that the countries of Europe would never go to war with each other, and thankfully that has been the case. The difficulty now, however, is that ethnic groups within particular countries have gone to war with each other. It is similar to a family falling out. Such conflicts are much more difficult to resolve than those involving one country fighting with another. I presume the development bank will be hugely influential in resolving such difficulties.

When the Bill has been enacted, Ireland will become a full member of the development bank and will play its part, as it has always done, in the development of Europe and the world. Now that the country is richer, it will be able to do that little bit more. It is vital that the lines of communication with the communities in this country and others which believe that their Governments are letting them down will be kept open. If these communities believe that their national Governments are blocking their making progress, the existing problems will not be resolved. I wish the Bill well in its passage.

Mr. F. McGrath

I congratulate the Minister of State, Deputy Treacy, on his recent promotion in the reshuffle and wish him well for the future.

I welcome this important debate on the Council of Europe Development Bank Bill 2004. The Bill is relevant in terms of the issues that have arisen in recent days. I refer here to the debate on the provision of assistance for poorer countries and the kidnapping of Margaret Hassan. The Bill gives us an opportunity to consider the issues of development aid, refugees, housing, poverty and education. It gives us a further opportunity to look at ourselves as a member of the European Union.

Before dealing with the detail of the legislation, it is appropriate to urge member states of the European Union with bad track records in respect of the way they dealt with poorer countries in Africa and the Third World to apologise for their past activities. Those directly involved in colonialism and the exploitation of poorer African countries should apologise before we proceed.

The Bill also provides an opportunity to consider the financial supports for poorer countries and Ireland's obligation, as a wealthy nation, to those countries. There is no excuse for Ireland, with its massive wealth, not to play its part on the international stage and provide assistance to poorer countries. I urge the Minister of State to be proactive in the debate on the target for overseas development aid of 0.7% of GNP and to ensure that this is reached by 2007. I encourage the Minister of State to support the reaching of this target because it is important and people's lives depend on it.

It is important to thank and commend Irish aid workers who are spread across the globe in many poverty stricken countries providing assistance to people. Ireland has a strong track record at United Nations level and at voluntary level in this area. The people to whom I refer have struggled alongside the poor of the world and have helped them at risk to their own lives. Many have made the ultimate sacrifice. It is appropriate at this stage to pay tribute to Irish soldiers who have died serving the United Nations abroad. These are the kinds of people who have made Ireland a positive and proactive country on the international stage.

Margaret Hassan, who was sadly kidnapped in recent days, is involved with CARE International, an excellent organisation which deals with the issues we are discussing, namely, development aid, investment and providing assistance for poor people. All parties and Members united during yesterday's debate to demand Margaret Hassan's release, for which I commend them. CARE International, with its 9,000 workers, has made a massive contribution in Iraq. It has also helped 30 million people in other poor countries. These matters are relevant to the debate on the legislation.

The Bill provides for Ireland's membership of the Council of Europe Development Bank. The bank helps in solving the social problems with which European countries are or may be faced with as a result of the presence of refugees, including displaced persons or migrants among movements of refugees or other forced movements of populations as a result of natural or ecological disasters.

Following up on the recommendation of the second summit of the Council of Europe which took place in October 1997, the bank regards the strengthening of social cohesion as a new priority in the development of its actions. Over and above specific operations in favour of employment, promoting social cohesion in Europe means supporting vocational training, social housing, health care, rural modernisation programmes, improvement of the quality of life in disadvantaged urban areas and the protection and rehabilitation of Europe's historical heritage. The issue of apologising to people in the Third World, especially Africa, should be considered in the context of rehabilitating Europe's historical heritage.

According to the terms of membership agreed initially by the governing board of the bank, Ireland's subscription to the capital of the bank will amount to approximately €30 million, of which €3 million will be paid as capital and the remainder will be available to the bank in the form of callable capital. Ireland will also be required to make a contribution of approximately €9 million to the bank's reserve. Our total cash contribution will amount to €13,132,680 to be paid in equal instalments of more than €3 million over a four year period. These are the nuts and bolts of the legislation.

I wish to focus on a related issue, namely, the debate about refugees. We urgently need a public education programme, both here and in other European Union countries, to tackle some of the myths about refugees, asylum seekers and migrant workers. I regularly hear amazing myths in my constituency, one of which is that the country is flooded with asylum seekers. As the figures show, asylum seekers constitute a relatively small proportion of total inward migration. From 1995 to 2000, half of new arrivals were returning Irish emigrants. Last year, 50,000 work permits were issued, while the number of asylum seekers was approximately 7,900. At least 50,000 migrants — the figure has probably increased in the past three months — work here and make a major contribution to the State. These figures bury the myth that we are flooded with asylum seekers.

A second myth is that asylum seekers receive money for cars, mobile telephones and drink. This is untrue and off the wall. Apart from receiving board and accommodation while their applications are being processed, precisely the same social welfare entitlements are available to them as to Irish people. I must sell this message to people because the stories making the rounds are appalling.

Another myth is that asylum seekers do not want to work and have come here to steal our jobs. The European Union has a role to play in addressing this issue. The reality is that asylum seekers are barred from working while their cases are examined, although many work voluntarily in the community, including in refugee projects. I commend those doing such work, many of whom I have met in recent years.

I also wish to bury the myth that asylum seekers are bogus and have no legitimate right to be here. While I accept that some applicants are found to be ineligible for asylum, I will not take the high moral ground on the issue given that I know many people living illegally in the United States. Although some refugees are found ineligible under the Geneva Convention, this ignores the fact that most of them are forced to leave their homes due to dire economic, political and social circumstance. We urgently need a public education programme to address this issue.

I urge the Council of Europe Development Bank to work on issues such as poverty and disadvantage, which are included in its remit as established in the legislation. Before we tackle such issues at home, I encourage the European Union to deal with the HIV-AIDS crisis, the greatest health crisis facing the world. In two decades, HIV-AIDS has claimed 30 million lives. Of the estimated €40 million people living with the disease, 95% live in developing countries and a further 14,000 people are infected every day. These figures are astonishing and must be tackled at EU and international level.

HIV-AIDS is destroying families and communities and sapping the economic vitality from countries. The loss of teachers through AIDS, for example, contributes to illiteracy and a lack of skills. The decimation of civil servants weakens core government functions, thus threatening security. The burden of HIV-AIDs, including the death toll among health workers, is pushing health systems towards the brink of collapse. In the most severely affected regions, the impact of disease and death is undermining the economic, social and political gains of the past half century and crushing hopes for a better future.

A cure for HIV infection is years away but the development of life-saving drugs has brought new hope, which is welcome. In high income countries, particularly in the west, therapy has extended and improved life for large numbers of people living with HIV-AIDS and transformed perceptions of it from a fatal disease to a manageable chronic illness. In the poorest parts of the world, the regions in which HIV-AIDS has spread most rapidly, this transformation has not yet taken place. The lack of change in poorer countries is relevant in terms of assisting poorer countries.

On the issue of dealing with refugees, as outlined in the legislation, let us look at the reality and consider those who have come to European Union countries and made a massive contribution. They have come to new states, including Ireland, settled and served their host countries. I recently encountered a sad case involving a Kurdish family who were granted refugee status and have happily settled in my constituency. Sadly, six more members of the family are stuck in a refugee camp in Iraq which is experiencing major problems, including violence, attacks on women and anti-social behaviour. The family has pleaded with me to help them. I am trying to persuade the Minister for Justice, Equality and Law Reform to intervene to relocate the family members from the refugee camp to reunite them with their family in Marino. Members of the family are learning information technology and making a major contribution. We all have an obligation to ensure that the Kurdish family in question is reunited. I cite this case because assisting refugees, especially those in European countries, is part of the purpose of the Council of Europe Development Bank. Sadly, the Minister rejected the application to reunify the family. I urge him and other legislators to be a little more open and proactive.

The legislation includes a section on education. Education and skills are important in dealing with disadvantage while language is important in dealing with non-nationals learning the language of their host country. We must also respect their language and culture.

I worked in a small north inner-city school with children of 11 nationalities. The children had no problems although many of the adults appeared to have problems in terms of racism and discrimination. I have seen children from 11 different countries learn together from the age of four years onwards. They respected and accommodated difference and got on with their lives. I have also seen the positive side of having three or four different nationalities on a football team for children under 13 years proudly working together in the interests of their community and school.

These issues are covered in the Bill and must be addressed through education programmes. As part of the refugee programme, we must have a solid campaign against racism, by which I do not mean using silly slogans such as "Say No to Racism". Instead, well thought-out programmes are required and children must be educated about accommodating and enjoying difference, respecting diversity and working together. We cannot let racism become established. Until now, we have had a good record, although there are some signs of it. They are not particularly large but they must be nipped in the bud to prevent their expansion. Racism, like sectarianism, cannot be allowed to grow.

A section of the Bill deals with vocational training. This is the key to social inclusion. There is much talk in this Chamber about social inclusion but training, particularly vocational training, is most important. It is the key to success and personal development, especially for people from non-EU countries who arrive in the European Union. In the process of trying to get a job and becoming involved in the economic development of their host country, education and vocational training are important.

There is also a section in the Bill dealing with health care. This is another important strategy and more investment is needed to assist people who have health problems. We have heard the debate in the past few weeks about our health service. We are aware of the need to adopt change and to reform the health service. There is also a need for investment in the health service. This section is part of the legislation dealing with social cohesion.

Another section of the Bill deals with social housing. Local authorities, the Minister for the Environment, Heritage and Local Government and other Ministers dealing with housing need to be clear and imaginative when planning social and local authority housing and move away from the concept of building ghettos. Many mistakes were made. There was bad planning in the 1970s when many bad projects were built. Putting all disadvantaged people in one place is a disastrous policy. It is not the progressive way forward.

I urge people to face reality and learn from the mistakes of the past about inclusion, mixed housing and breaking down the barriers between private and local authority housing estates. It is a national scandal that one can be living in massive poverty in one part of Dublin yet walk 500 m down the road and be in an affluent area. This type of apartheid cannot be allowed in our country. We cannot go around the world lecturing other countries if we do not take a proactive role ourselves. That is most important when discussing the parts of this legislation that deal with social housing. People in other countries, such as England and America, have also made mistakes.

We need to get away from the concept of ghettos. We have read about these in recent reports but I do not like to name areas because people need a lift and should be supported rather than being regularly analysed and discussed in reports. We know the problems. We know the way out of disadvantage is education, a job and a decent home. Another 25 years can be spent conducting research, making reports and holding constant seminars on poverty but the bottom line is education, a job and a house. Only then will children be able to break out of disadvantage.

When looking at these reports it should be borne in mind that the vast majority of the junior infant children who go to school each morning are three, and sometimes four, years behind the child from the average middle income family in this country. That is where the disadvantage starts. If one does not intervene fast in the pre-school and early education years, the damage is done. One is losing the battle or trying to catch up for the next seven or eight years in the primary school sector. That is the reason many children are dropping out of the system.

These are important elements of this debate. Economic development is part of the strategy to deal with these issues. Rural modernisation is mentioned in the Bill. People should be reminded of the rights of migrant workers who come to this State. Many of them are providing an expert service but, sadly, some of them are being exploited. Exploitation should never be part of any social, political or economic agenda. Families should be allowed into this country to work. They should be treated well and with respect. We should not discriminate against them. I challenge people to stand up for them. The bottom line is that we need them, they need us and together we can work as a unit.

There are approximately 50,000 migrant workers in the State. Many of us know some of them. They work in our pubs, shops, hotels and hospitals. Those services could not be run without them and we should remind people of that fact. Many people, particularly in political life, are ducking and diving on this issue. Migrant workers are doing an excellent job. In fact, the main complaint I have heard recently is that we are losing the friendly Irish smile and warm Irish attitude because we are so busy in this Celtic tiger economy that we do not how to look after the customer in the local bar, club or hotel. A smile does not cost much. This is one of the basic things I have learned from many non-nationals who have arrived in this State. I see the proactive way they deal with people and the compliments they receive from managers in the catering trade.

These are important issues. This is important legislation because it contains strategies for tackling poverty and for dealing with housing, education and development aid generally. It is important that all Members of the House support it.

Mr. Coveney

I ask the Minister of State, Deputy Brian Lenihan, to convey my good wishes to his younger brother, Deputy Conor Lenihan, who has been appointed Minister of State at the Department of Foreign Affairs. The development aid budget is significant and, hopefully, will become more significant. Therefore, I wish him well in managing it.

This is an uncontentious Bill which Fine Gael supports. It allows Ireland to join the Council of Europe Development Bank and make a contribution to it. Under the terms of membership agreed by the governing board of the bank, Ireland's subscription to the bank's capital will be €30 million. A sum of €3 million will be paid in capital and the remainder will be available to the bank in the form of callable capital. Ireland will also be required to make a contribution to the bank's reserves. It is not before time that Ireland joined the bank.

The bank's history is interesting. Following the Second World War, Europe had to deal with a considerable flux of displaced people and refugees for whom no provision had been made and for whom no support mechanism had been put in place. To alleviate the situation, the Council of Europe decided to create what it called a social bank, whose aim would be to borrow in order that it could lend to member states' governments or legal entities guaranteed by them. In 1956, therefore, the CEB was born. Although perhaps not the most widely known, it is the oldest international financial institution in Europe.

It is fundamentally different from other banks in that it has an exclusively social vocation. The bank provides long-term loans for its member state governments, local authorities and public and private financial institutions to finance social progress. Thirty seven of the 46 member states of the Council of Europe are members of the bank. Of the 25 EU member states, all except Austria, the United Kingdom and Ireland are already members of the bank. It is time Ireland decided to become a member.

The raison d’être of the Council of Europe Development Bank is consistent with all that is positive about the European Union and the great European project over the past 50 years. The EU ideals are consistent with the bank’s. They are to give support from stronger countries to weaker ones to ensure a common standard develops across the Continent and to promote democracy, freedom of speech and opinion, a common marketplace and human rights. Most importantly for the bank is the ideal of supporting projects that help to alleviate poverty and despair in European countries.

As the European Union continues to grow and develop positively with its neighbours, the bank continues to play an important role in assisting with the development of countries that need assistance to improve the lives of their citizens.

The Council of Europe Development Bank provides loans or guarantees in three main areas or spheres of activity. The first relates to social integration, promoting projects of urban and rural reintegration, social housing, support for small and medium-sized enterprises, vocational training, in particular in disadvantaged areas, and assisting the settlement of refugees and migrant workers, for example, by providing language classes. In all these areas, Ireland still has work to do.

The Bill provides an opportunity for us to make some comments on such areas of social integration. Immigration policy is an area which has resulted in political cowardice. It is unacceptable that despite the clear problems with our immigration and, in particular, asylum policy, there has been no significant change of direction or policy. It is unacceptable that it takes up to three years to decide on whether an asylum application is valid. In that period, despite that the persons involved may be willing and able to work, they are unable to do so. In the end, a decision is taken which may not have any consequence on whether a person will be sent home. As Deputy Howlin stated, the unfortunate situation exists whereby the vast majority of asylum seekers who come to Ireland are economic migrants. However, because we have no system to deal with economic migrants who want to come here——

Mr. B. Lenihan

We do. We have a work visa system.

Mr. Coveney

We have a work visa system based purely on the needs of employers who must apply for a work permit for a person to come here. This makes it impossible for people from many countries even to aspire to coming here because they have no way of accessing information on work or convincing an employer to employ them. This is the reality. Instead, they pay somebody to put them on a plane or ship and they come here to claim asylum although they are coming to work. They stay for perhaps three years going through the asylum process.

The system is inefficient and should be capable of making a decision much more quickly. The Government should set itself a target to decide on asylum applications within six months. If after six months it is not capable of making a decision on an asylum application, some facility to allow the person to work should be introduced because this is how he or she will properly integrate into society while a decision is being made on his or her application.

The bank's role on job creation is important, in particular in regard to small and medium-sized enterprises and particularly in central and eastern Europe. Some countries emerging from the darkness of Communism suddenly have the capacity to grow and develop small and medium-sized businesses but need assistance to do this. Ireland is a good example in that it has experienced rapid economic development. There have been some social consequences but, by and large, it has been a hugely positive experience. The new member states of the European Union look to Ireland as a template for economic development and change. The Council of Europe Development Bank has a vital role in supporting small and medium-sized businesses, vocational training and the kind of business expertise and development required for rapid progress to be made in the small and medium-sized business sector in central and eastern European countries. Ireland should be supportive of this process.

The second sphere of activity supported by the CEDB is the development of human capital, in particular in the health and education sectors. However, as this area has been dealt with by other speakers, I will move on. The third sphere relates to the responsible management of the environment. In recent years, the CEDB has increased levels of support for projects of an environmental nature, such as for the development of clean, renewable energies and innovative projects for the treatment of waste. As the European Union has enlarged and as a more transparent and open Europe develops eastward, there is potential for significant environmental concern, in particular in the area of energy generation. The bank should consider this in a positive way to promote necessary change in eastern European countries which have difficulties with outdated technologies and fuel sources for energy creation. There has also been strong support in the case of environmental disasters such as earthquakes in Slovenia and Turkey and flooding in Poland, Bulgaria and elsewhere in Europe.

With regard to EU enlargement, the Council of Europe Development Bank makes a significant contribution to preparing countries for accession, helps to progress countries which have recently joined the Union and promotes the building of common standards across the Continent. Bulgaria, Romania and Turkey are involved in accession negotiations and Bulgaria and Romania should, I hope, join in 2007.

Many Europeans are rethinking their approach to Turkey and I wish to make my position clear. I welcome the European Commission's recommendation that accession negotiations begin with Turkey. Without Turkey's aspiration to join the European Union, it would not have made progress on human rights and the move towards a normalised democracy, the rule of law and freedom of speech. The reform process would not have happened at the pace it has had Turkey not had the end goal of European Union membership.

Some would advocate cutting Turkey off and saying to the Turks that for historical and geographical reasons, they are not part of Europe and not welcome to join the Union at any stage. This would set the reform process in Turkey back by many years. At present, the ace card for reformers and positive, pro-democracy politicians and people in Turkey is that some day they will lead their country to EU membership and the benefits this will bring for its 70 million people, which may perhaps be 80 million in a decade. The European Union must not send out the message that it is a Christian club which is frightened and unwilling to go through the necessary accession negotiation process with Turkey.

I wish to quickly dispel another myth. Some talk about accession negotiations with Turkey as if Turkey was to join the European Union next week or next year.

The reality is that the optimists within the Turkish Government say it will take ten or 15 years for Turkey to reach the standards set under the Copenhagen criteria and is willing and able to join the European Union.

An Ceann Comhairle

I am reluctant to intervene but we are well outside the scope of the Bill.

Mr. Coveney

We are not, if the Chair listened to the first part of what I had to say, which is that one of the main roles of the Council of Europe Development Bank is to prepare countries for accession to the European Union.

An Ceann Comhairle

I accept that.

Mr. Coveney

It has already done that regarding Turkey.

An Ceann Comhairle

It is in order to make a passing reference to the accession of Turkey, but we cannot have a wide-ranging debate on it.

Mr. Coveney

I have been speaking for 20 minutes, three or four of them on Turkey, but I will not spend any more time on it.

An Ceann Comhairle

I have brought the same point to the attention of other Members this morning and I want to be consistent.

Mr. Coveney

I accept the Chair's ruling on that. I will make one final point on Turkey. We must continue to invest in Turkey to support and promote the reform process. The one hugely positive contribution Europe can make in the next ten years to the 70 to 80 million people in Turkey is to continue to encourage them in the most positive way towards a continuing reform process. To do that we must offer them the carrot of membership in the future.

Ireland's contribution to development aid in the developing world is also relevant to this Bill and many other speakers have referred to it. The main issue is whether Ireland will fulfil its commitments to the UN, made on the international stage on numerous occasions, to clearly and unambiguously provide 0.7% of our gross national product, GNP, by 2007 towards development aid overseas. This is by far the biggest issue facing the new Minister of State, Deputy Conor Lenihan, in the coming years. His credibility will be on the line if he cannot achieve this target, which will not be easy. However, he will have the support of this side of the House, certainly of Fine Gael, in trying to achieve that. I hope he will also have the support of the Taoiseach.

This is an issue on which Ireland's credibility internationally is on the line. Ireland does not contribute significant resources towards military activity and common security and defence within Europe or in the world, although our armed forces make a valuable contribution towards peacekeeping. This is an area where we can make a significant difference, where we have credibility and non-governmental organisations, NGOs, making a contribution throughout the world. The Irish people will accept what will in effect be close to €700 million by 2007 if GNP continues to grow as is anticipated and we meet our target of 0.7% of GNP within the next three years.

Unfortunately, in the past two years we have been going in the wrong direction. In 2002 we contributed 0.41% of GNP towards development aid. In 2003 we contributed 0.40%. The Government argues that in net terms the amount of money going towards development aid has increased from €422 million to €445 million. That is true, but the percentage of GNP, which is a more accurate measurement of Ireland's sacrifice towards the developing world — it should not be called a sacrifice, it is our obligation towards the developing world — is moving in the wrong direction. We need to turn that around and increase our contribution from 0.4% of GNP to 0.7% in two to three years. That will be a significant feat. However, even though we need to spend money on social projects here also, if the value of such a contribution and where it is being spent is properly explained and it can be shown that it is being spent in a transparent and measurable way, people will accept it.

Given the projects that Development Co-operation Aid, formerly Ireland Aid, is supporting, particularly in our programme countries in east Africa, it is clear that money is being spent in a hugely positive way. Anybody who has been privileged to travel to Africa, to any of the programme countries where Development Co-operation Aid operates, will see the same kinds of people one can see anywhere in the world, but they are living on a different planet compared to the world in which we live. The criticisms made regarding reluctance to support countries that have corrupt Governments need to be clarified. If we are too critical of Governments it will be almost impossible to invest in any country in Africa. We must make a leap of faith and take a calculated risk in supporting departments of health and education in countries across the continent of Africa. It is a risk we must take because not only are we supporting people there, we are also supporting the development of a more transparent governance process within those countries, and the best way to do that is to invest and insist on getting, on an annual basis, transparent details regarding where that money has been spent.

I look forward to Ireland's development aid contributions continuing to increase over the next two to three years under the stewardship of the Minister of State, Deputy Conor Lenihan.

Mr. Crawford

This is an important Bill. As a nation we have benefited greatly from our membership of the EU over the past 30-odd years. It is time for us to enter into the spirit of what the EU is all about. That includes contributing to the development of difficult areas. I cannot help going back in history because, between the famine and other difficulties through the years, Ireland has many stories to tell. One of the greatest stories, particularly as far as County Monaghan is concerned, is that today is the centenary of the birth of the great Patrick Kavanagh. He came from the stony grey soil of Ireland and recorded many of the difficulties experienced by people in such areas before Ireland reached its present stage of development. The Ceann Comhairle and I had the honour of attending the world launch of the stage adaptation of his book The Green Fool and it was extremely interesting to see its portrayal of the way we dealt with our history and our problems.

Ireland's commitment to development aid has been a contentious issue over the past few weeks. It is frightening that the newly appointed Minister openly states that we will not reach the target of 0.7% of GNP, on which the Taoiseach made a solemn commitment. I am aware that few other countries have met the target. However, it is not good enough, considering our nation's history of famine and emigration, to row back from the commitment given by the Taoiseach when seeking a seat on an international body. He admitted that we gained the seat because of the commitment and we must, therefore, be seen to meet it.

Ireland has a proud record in supporting overseas development. Missionaries from all churches and none have created a strong image of Ireland in all those countries that needed support and aid. While missionaries were involved in programmes, there were also back-up workers. The Government must send a clear message that Ireland is committed to the 0.7% figure now that the finance is available. I appreciate the House's call for the return of Mrs. Margaret Hassan to her family. She is proof of the commitment many Irish people have given to those in need, wherever they may be.

The EU has played a role in developing the new Ireland of today. I am old enough to remember what it was like before EEC membership.

Mr. S. Power

The Deputy is too young to remember as far back as then.

Mr. Crawford

Our entry into the EEC was a major step into what many felt was the unknown. My predecessor, the late, great Mr. James Dillon, first proposed EEC membership and the Fine Gael Party has always been strongly pro-European, whether in Government or otherwise. Our support is not given blindly as we are involved in the largest political grouping in the European Parliament, ensuring EU programmes are to Ireland's benefit. As chairman of the European committee on beef and veal, I had the pleasure of chairing meetings with members from the United Kingdom, Germany and France. The peoples of these countries had fought in two world wars and had every reason to have tremendous hatred for each other. However, after the Second World War, they realised a better way by sitting down and discussing economic and social issues. By doing so, we have come to where we are today without a third world war involving Europe.

The EU, with the US, has played an important role in Ireland's peace initiative, of which we must be proud. The Border region was hard hit with 30 years of the Troubles. However, over the years it has benefited from the International Fund for Ireland, set up by the Anglo-Irish Agreement negotiated by the then Taoiseach, Dr. Garret FitzGerald. It also benefited from the PEACE I fund, negotiated at the time of the ceasefire by the then Taoiseach, Mr. Albert Reynolds, and PEACE II, a result of the Good Friday Agreement under the Taoiseach, Deputy Bertie Ahern. Other EU funding has been available under the INTERREG programme. All these programmes have helped in meeting the needs of the Border region. However, Government commitment has not matched these. The funds are often used to replace moneys rather than the opposite.

This non-contentious and long overdue Bill providing for Ireland's membership of the Council of Europe Development Bank is supported by the Fine Gael Party. Membership will commit Ireland in capital subscription to approximately €3.4 million each year for the next four years. This fades into insignificance when compared with the moneys spent on the Punchestown Equestrian Centre or on electronic voting, on which €52 million was wasted. Ireland is not, therefore, entering into a major commitment. The bank is geared to strengthening aid to refugees, migrants and displaced populations. As a country that has suffered from migration in the past, it will be a great honour to participate in the bank's work.

Until 1987 many Irish people were forced to emigrate to the USA, Australia, the UK and elsewhere. While it can be argued that they worked hard in these countries, it must also be remembered they were allowed to work. Many did the work that those in their adopted countries were happy to see them do. Recently, I travelled with a colleague on the motorway between London and Wales. He was amazed at its size as it was his first time on the motorway. I reminded him that our sons and daughters worked on the building of that structure and that is why the UK has the infrastructure it has now.

Those seeking refugee status in Ireland are often criticised. However, families of Irish migrants are in desperation due to the new US immigration controls. Their desperation brings the vast number of Irish illegals in the USA to our attention. I ask the Minister for Foreign Affairs to raise this as a matter of urgency. Arrangements introduced after the events of 11 September 2001 have made entry into the USA more difficult. While US immigration officials cannot be blamed for stricter entry rules, the onus is on the Taoiseach and the Minister for Foreign Affairs to use our good relationship with the USA to resolve the issue.

The bank has a role to play in the provision of social housing. When one walks the streets of Dublin or meets constituents who cannot get rent allowance, one knows we need more social housing. I thank God job creation is not the major problem it was many years ago in most parts of Ireland. I make no apology for saying the Border region has not been given its fair share of high-tech and highly paid industries. We hope that can be rectified with the appointment of a Minister for Foreign Affairs from the Border region.

We know a great deal about urban and rural disadvantage and regeneration. The situation here has improved in recent years but there is still room for improvement. We should certainly be involved in anything we can do to help in other parts of Europe. The bank has been deeply involved in supporting countries at times of natural or other disasters and in assisting them in preventative action measures. It was involved in reconstruction in Hungary after floods there. It also gave aid to refugees and migrants in Lithuania. Another project in which it was involved was reconstruction following flooding in Poland and flood prevention measures there. These are only a few of the projects in which the bank has been involved. When one sees on television the devastation that has been wreaked in poorer countries in eastern Europe, it is evident they could not afford to pay for reconstruction without aid and I support the giving of such aid wholeheartedly.

Protection of the environment is another important aspect of the bank's work, as is the preservation of historical and cultural heritage. Sometimes countries cannot afford to do this for themselves and support at a crucial time can be vital. Two other aspects of the bank's role that are of particular interest because of our current situation relate to the development of human capital in terms of education and health. Education is very important but even here children leave school without a proper understanding of the three Rs. While I support development in this area elsewhere, we must put our own house in order first.

The role of the bank in improving health care is an important one. I have tried to raise this matter in several ways in the House. Members may be aware of what I have said previously about supporting other European countries while ignoring the problem in the Border region where people do not have access to hospitals. People must travel to Sligo, Enniskillen and elsewhere. I would be less than responsible in my duty if I did not highlight this matter. If we are to be taken seriously in the structure of the Council of Europe Development Bank and in other areas of development, we must put our own house in order. We must ensure we have the administration and structures that will give an adequate health service and sustain lives in our country. That is all I ask. It is vital that we show others we have the ability to manage significant resources and deliver a health service at least equal to what we were able to provide 30 years ago.

The bank has provided €11 million for health care improvement projects in Bulgaria. That kind of initiative is to be encouraged and supported. As a member of the British-Irish Inter-Parliamentary Body I visited areas in Scotland, Wales and the Isle of Man. I saw how peripheral areas were being dealt with, which convinced me of the need for proper primary care. It is important for us to be involved in such projects through the bank but we must not forget the situation at home. We need to create an environment where people can have medical cards and get access to primary care.

An Ceann Comhairle

Like his colleague before him, Deputy Crawford is going well outside the scope of the Bill.

Mr. Crawford

Unless we can show we can do it ourselves, it is difficult to tell others how to do it, but I accept the Ceann Comhairle's point.

An Ceann Comhairle

Even a passing reference to the matters raised would not be in order on the Bill.

Mr. Crawford

I will return to development aid and how we can help. The money we give through the bank can make an important contribution but we must examine other ways to support those in need.

A great hero of mine and a man for whom I had tremendous respect is the late T.J. Maher. He was not only a farm organisation leader but also a member of the European Parliament. One of the things he did in a quiet way was to encourage people to subscribe towards funding various projects. It was not a case of handing out money to people to feed them for the day. He organised the export of in-calf Friesian heifers from this country to parts of Africa. He also organised projects for sinking wells. He showed how major dividends could be realised from little money and that is something which we must look at in our involvement in the Council of Europe Development Bank. We must use our presence to ensure that it is not just a case of money being provided where it is needed but also that retired or other expertise available to us would be encouraged to help in such areas.

I hope the Ceann Comhairle will not rule me out of order on this point. In my home parish of Aghabog the late Hugh McKearney was made parish agent in the 1960s and a small amount of funding was provided in grant aid. Through his expertise he was able to advise and encourage the small farmers of that area to better utilise what they had. This helped to revolutionise the area and brought it back from what might have been a forest to a living rural community. That is the type of action from which we must learn.

An Ceann Comhairle

The Deputy is not only outside the scope of the Bill, his time is concluded.

Mr. S. Power

He did not even get his second wind.

Mr. Crawford

We must encourage that kind of endeavour. In the interests of the Ceann Comhairle I will conclude. I support and encourage the Government not only to implement the legislation but also to ensure it meets the commitments given by the Taoiseach towards overseas development aid.

Mr. Healy

I wish to share time with Deputy Connolly.

An Ceann Comhairle

Is that agreed? Agreed.

Mr. Healy

The Bill in part arises from the Ireland Aid review committee which reported in 2002. The Bill has been slow in coming to the House. The review gave rise to other issues which should be dealt with in the legislation, such as debt cancellation, overseas development aid and membership of the African and Asian development banks. The Bill should be amended in at least those two significant respects. I call on the International Monetary Fund and the World Bank to cancel Third World debt. The Council of Europe Development Bank claims to fight poverty but both it and the International Monetary Fund are draining the life blood out of the poorest countries by insisting on debt repayments. The biggest creditors are the poorest countries in the world. The bank claims it cannot cancel the debt repayments. However, the World Bank and the International Monetary Fund are among the world's most prosperous financial institutions. The IMF has one of the world's largest holdings of gold reserves, so it is quite in order for cancellation of debt to be on the agenda. If the poorest countries are to prioritise the needs of their peoples, then cancellation of debt is vitally important.

Debt cancellation was a millennium goal. At the start of the new millennium, the international community laid down a number of goals that were to be met by 2015. The aim was to improve the lives of millions of people by tackling poverty. The goals included matters such as the halving of extreme poverty, achieving primary education for all and reducing child mortality by two thirds. They were minimal goals, but four years later we find that even these are not going to be met and debt repayments are a major obstacle to their achievement. According to the UN, many countries will need 100% debt cancellation to help achieve the goals. For instance, countries such as Senegal are spending twice as much on debt repayment as on their health services. Zambia, Malawi, Niger and Gambia are spending more on debt than on education. Debt cancellation is a major issue and should be dealt with in this Bill by way of amendment on Committee Stage.

A second area that should be dealt with in the Bill and which is not is the question of overseas development aid. The confusion that has arisen in regard to this in recent weeks serves to underline the argument that the Bill should deal with this issue. Ireland is supposedly committed to paying 0.7% of gross domestic product, GDP, by 2007. There is now a serious indication that this will not happen. Ireland is one of the wealthiest countries in the world and it is a disgrace that there should be a question mark over overseas development aid. The only way to resolve this problem is by statutory initiative to ensure there is a legal obligation on the Government of the day to meet these goals.

Mr. Connolly

I congratulate Deputy Power on his appointment as Minister of State at the Department of Health and Children and invite him to visit my constituency of Cavan-Monaghan where I will show him around.

I welcome the opportunity to speak on the Bill, which I support. It arises from the 2002 report of the Ireland Aid review committee which recommended a strategy for Ireland to join a number of development banks, including the Council of Europe Development Bank. In this regard, I pay tribute to the dedicated and admirable work of a former Minister of State in charge of overseas development, Deputy Tom Kitt, for his proactive role and pioneering work in this area. His predecessor, Deputy O'Donnell, also deserves commendation for her great commitment to the resolution of the problems of displacement of peoples in the Balkans, in particular those in Bosnia Herzegovina.

The Council of Europe Development Bank has as its primary purpose the resolution of the social problems which many European countries have been or may be faced with, namely, the displacement of refugees, displaced persons or migrants. Many of these persons are economic migrants or arrive in this country as a result of being displaced because of war or, perhaps, natural disaster. Europe has just witnessed a war of savage dimensions and unparalleled since the end of the Second World War. Carnage and atrocities on a massive scale were commonplace, initially in Slovenia and subsequently in Croatia, both of which had declared their independence from the former Yugoslavia, and latterly Bosnia Herzegovina.

The war in Slovenia was over in a matter of weeks and the question of displaced persons did not arise as the Yugoslav national army had suffered a setback in seeking to bring Slovenia to heel. It preferred to concentrate its military might on both Croatia and Bosnia Herzegovina where a war of unmitigated savagery was carried out for the next four years, with both the EU and UN apparently impotent in brokering a solution. The ghastly practice of ethnic cleansing then entered the vernacular, with the forced transfer of entire ethnic groups from areas where they had lived for countless generations and the requisitioning of their homes by the so-called victors. A total of 2.3 million people were removed from their homes in this way and expelled from their native areas with no thought for their re-housing or resettlement.

Banja Luka in the putative Republika Srpska in north-eastern Bosnia was one of the areas that suffered most from this hideous practice. Three-quarters of the non-Serb population were forcibly expelled and anyone who resisted was summarily executed. Those being expelled suffered the added indignity of being forced to pay the sum of 100 deutschmarks each, equivalent at the time to approximately €50, for the privilege of being allowed to stay alive. These refugees were expelled to make way for large numbers of Serb nationals who were refugees from other municipalities affected by the war. Areas that were forcibly occupied and cleansed, to use the abhorrent expression, have not been resettled and the onus remains on the authorities to agree a programme of refugee resettlement between the various ethnic groups.

Responsibility devolves to the Council of Europe Development Bank to facilitate such a process by contributing to various projects that will facilitate and expedite such a resettlement programme. There is no prospect of Bosnia Herzegovina attaining EU membership in the foreseeable future while issues of refugee resettlement are unresolved. The concept of creating the bank came from the Council of Europe. After the Second World War, no measures had been taken in support of the so-called national refugees, in particular East German refugees in West Germany. The Council of Europe entrusted Mr. Pierre Schneider, President of the French National Assembly and the Council's special representative for national refugees and over-population, with the task of finding a solution to the plight of these national refugees. He opted for a flexible system, namely, the creation by the members of the Council of Europe of a social bank whose aim would be to borrow to lend the amounts borrowed to member states of the Council. The purpose of these loans was to finance projects, create new jobs and target the resettling of national refugees and the management of excess populations in Europe. The so-called Council of Europe resettlement fund for national refugees and over-population in Europe was created. This was later to become the Council of Europe Social Development Bank. Over the years it evolved into the Council of Europe Development Bank, which came into being on 1 November 1999 with the objectives unchanged.

This name gives a clearer understanding of the institution's activity, which is that of a development bank. The clearer understanding also serves to promote the social objectives which are the reason for the bank's existence. It is the oldest multilateral financial institution in Europe and its originality stems from the nature of its projects and its broad geographical shareholder spectrum. It seeks to foster balanced social development through its actions in the fields of health, education, social housing and employment for victims of natural disasters as well as fragile population groups. It also provides loans for housing for low income groups in the form of social flats and infrastructure in the social area. Other projects catered for include the creation of social infrastructure and the building of primary schools as well as health care and environmental protection. It also promotes projects for the creation of jobs in small and medium-sized industries. With its new structural orientations, the Council of Europe Development Bank has over the years affirmed its specificity within the community of supranational institutions.

The bank has two particular characteristics. First, it is the only European development bank with a purely social vocation and its activities include projects to combat extreme poverty and social exclusion. Our banks should send their people on in-service training courses or projects to some of these banks. They might find a new way of doing business and come back with a more community oriented ethos, which would be welcome.

Second, it directs its financing exclusively to banks or public entities. That characteristic makes it truly complementary to other supranational institutions. The bank grants loans and guarantees, not subsidies. In exceptional circumstances, however, it has granted donations to certain countries in response to situations of extreme urgency, to Bosnia and Kosovo during the refugee crisis and Romania in the case of the orphans.

The accession of ten new states to the European Union on 1 May 2004, including eight central and eastern European countries, was designed to ensure the demographic stability and prosperity of a continent united around common values. At the same time this enlargement process, which should continue in the coming years, will lead the EU to face serious disparities that are likely to worsen unless appropriate measures are taken. That will constitute a major challenge for the bank as well as an opportunity to strengthen its contribution to social development.

Ireland's total cash contribution to the Council of Europe Development Bank will amount to €13 million to be paid over a four year period. I hope we will meet that objective, although I am aware there are doubts about our meeting the 0.7% of gross national product, GNP, target announced recently because we are a nation well known for our humanity and our work on the world stage in improving the lot of others. The first instalment will fall due within 30 days of the bank's receipt of Ireland's declaration of accession to membership and it is important that Ireland is seen to be playing a proactive role in the bank's continued development. I welcome the Bill.

An Ceann Comhairle

Did the Deputy intend to share time with Deputy Cuffe?

Mr. Connolly

Yes.

Mr. Cuffe

Like the previous speaker, I welcome the Bill before the House. It shows that we are developing our prosperity. We are joining the illustrious company of states such as the Holy See, Liechtenstein, San Marino and others. In essence, we are joining a very rich club and that is testimony to the development of Ireland within the past ten years. With that wealth comes a moral responsibility to reach out to the developing countries of Europe, some of which have joined the Union as members over the past ten years.

I welcome the type of projects the bank supports. Most of it does not make the headlines but one particular project, the restoration of the Mostar bridge, is worthy of support. I am pleased that a body such as the Holy See has contributed to the restoration of a very physical link between two parts of the town of Mostar, an important bridge between east and west and between different religions and faiths. That symbolises in many ways the importance of the bank and its contribution to the development of Europe, particularly looking towards eastern Europe.

It was of interest to examine the distribution of the bank's financial resources. I note in its last annual report it spent approximately one quarter of its funding on aid to migrants and victims of natural disasters. It spent a considerable amount of money on improving living conditions in disadvantaged urban areas. There is a certain irony in that the fields of action of the Council of Europe Development Bank should perhaps echo the fields of action on which this Government should be spending money. The fields of action are health, education and vocational training, social housing for people on low incomes, rural modernisation, improving living conditions in run-down urban areas, protection of the environment, creating viable jobs in disadvantaged areas and protecting and rehabilitating the historical and cultural heritage.

The Government could benefit from examining those eight fields of action in detail. In drafting the budget, perhaps it will concentrate on those eight fields because they address, in a detailed and specific way, the needs of the less well off in society and in Europe. We need a significant investment in housing for those on lower incomes and in health and education for the less well off. Given that the Minister for Education and Science is in the Chamber, I hope she takes note of and reflects on the principles and the fields of action of the bank in terms of bringing her own input to the Cabinet table shortly. There is an authority that the Council of Europe Development Bank brings to bear on developing countries and it is, curiously, a moral authority given the fields of endeavour and investment of the bank from which we could learn. I hope we shall learn from that.

The broad fields of action are worthy. The operating principles, from my cursory reading of the literature available, appear to be well thought out and detailed. There is a strong and careful attempt to comply with Council of Europe conventions and the various legislation in place in each of the countries to which aid is supplied. From the one or two brief trips I have made to eastern Europe, I am aware that enormous investment is required to provide the assistance needed for the victims of natural and man-made disasters. Whatever about the killing fields of the former Yugoslavia, the bank has invested heavily in restoring properties badly affected by floods in Germany and to the east last year. That should make us reflect for a moment on what is contributing to these disasters, and they are not just man made.

It is becoming more apparent that some of the extremes of weather that have characterised the past few years are probably a result of acts of man as much as acts of God. Institutions, whether they be Governments or banks that act on a transnational basis, must also reflect on the reality of climate change, the difficulties of untrammelled development and the problems it may create. It is worth reflecting that much of the aid and assistance this bank has brought to eastern Europe was intended to address the problems man has wrought on this Continent. I wish the Bill well and I pledge my party's support.

Mr. Murphy

Fine Gael welcomes the Bill as it will further the objectives of European unity. We welcome it particularly because it is a European institution dedicated to improving the lives of the less well off citizens of Europe.

Not long ago a Bill came before this House the purpose of which was to authorise €50 million for the World Bank. While there was general acceptance of it at the time, I have certain reservations about increasing our contribution to the World Bank while at the same time falling behind in our overseas aid commitments.

There are many questions to be asked about the World Bank intervention in some countries and, if anything, these questions loom larger than ever because of recent United States and British actions in the Middle East. There is a constant fear that such loans are conditional on recipient countries responding to the wishes of ultra-conservative right wing elements in the more powerful western countries. Interventions and conditions can on occasion do more harm than good when imposed on the poorest of countries.

I do not, however, have the same concerns about the Council of Europe Development Bank. Set up in 1956 to provide solutions to the problems of refugees, it has since adapted well to changes in social priorities in Europe. With a mission to contribute to social cohesion in Europe, it is a multilateral development bank and a key instrument in solidarity policy in Europe. While many European states, including Ireland, are relatively prosperous, the less developed eastern European countries have significant needs. As a member of the CEDB, Ireland will be able to contribute to the bank's capital with an initial contribution of approximately €13 million.

The bank's functions were particularly important in the run-up to the latest EU expansion. Living standards in many countries such as Latvia, Lithuania and Estonia have declined since the fall of the Berlin Wall, yet the citizens are willing to put up with these difficulties so that all their citizens may soon live the European dream, with the help of institutions such as this bank. The bank is even more important for countries aspiring to join the European Union, including Albania, Macedonia, Romania, Bulgaria and, to a lesser extent, Croatia. The enlargement process which will continue in the coming years will force the European Union to face serious social disparities. Financial institutions in Europe must rethink their strategy. The CEDB, with its special vocation to foster social convergence by prioritising social projects and responding to emergencies, will benefit the most vulnerable populations and the least advantaged countries. Nobody can argue with the bank's main objectives and priorities.

When considering the bona fides of the bank, it is important to examine what political powers influence its policies. Under its articles of agreement, the bank is attached to, and administered by, the authority of the Council of Europe, 36 of whose 45 member states are members of the bank. It conducts its business in accordance with the overall objectives of the assembly, with particular emphasis on human rights, pluralistic democracy and the rule of law. It is nevertheless legally and financially independent and is not financed by taxes but by its capital and reserves as well as resources raised in the financial markets.

Its procedures for guaranteeing or giving loans are well linked to the political system. The nation where the application originates must approve of its objectives. The application is then sent to the Council of Europe for political approval and to the governor of the CEDB for technical and financial approval. This robust and well-tested system ensures adherence to the aims of the Council of Europe. The bank's priorities are the strengthening of social integration by giving aid to refugees and migrants and displaced populations. There are many examples of flood relief, educational and housing projects financed by the bank over recent years, all extremely worthwhile. We in Fine Gael welcome this Bill which will add to the concept of European unity and integration and, as the strongest pro-EU party in the House, we are pleased to support it.

Mr. Kehoe

It is important that Ireland joins the Council of Europe Development Bank to make its contribution to the developing countries. By granting loans the CEDB helps to finance social projects. It will strengthen social integration by providing aid to refugees, migrants and displaced populations. It will also support social housing which is important here for the less well-off and will be all the more so for those in developing countries. This week a group of Irish construction workers went out to some poor countries to build houses, schools and accommodation for the less well off. I compliment them on this work. It is good to see such action because Ireland has provided a service to poor countries for many years, whether through fundraising projects or whatever. Deputy Crawford said other countries helped Ireland when we were in need, for example, all those who went to America and are illegally based there. We are repaying what was done for us.

Strengthening social integration includes job creation, preservation of SMEs and vocational training. Job creation and vocational training will prepare these people for the future. This work will focus on disadvantaged urban areas and rural modernisation. The bank also has a policy to manage and protect the environment. It is very sad to see pictures on television of disasters in these countries and that is why protecting their environments is very important. Together with this, it is important to preserve the historical and cultural heritage. We pump thousands and sometimes millions of euro into protecting our heritage and it is important for these other countries to protect their heritage. The CEDB will help fund this work.

The Bill covers developing human capital under the headings of education and health. The people who receive this money will appreciate all that is done for them. They are not very well educated and really appreciate access to education. People who come here from less developed countries and see our educational system — even if it is not up to scratch — recognise what they are unable to get in their own countries and know what they are missing. I spoke to a family who came here in 1999 and whom the authorities are trying to deport back to Bulgaria. They have seen the opportunities available here for their children since their arrival in 1999. They have seen the education that they have got and they appreciate that. It is important that these people are well educated for their future.

Debate adjourned.