I thank the Chairman. I have a presentation which involves the use of some slides. I am aware of the Chairman's previous occupation and the tendency to use overheads. He will forgive me if I do so.
I thank the sub-committee for its invitation. We are extremely privileged to appear before it. The work it is doing is among the most important the Oireachtas has done in modern times. The report it is preparing will have an enormous bearing on the future of the country in the European Union. My colleagues are: Mr. Tony Brown who, among other things, has written two chapters in the report looking at the history leading up to the Lisbon treaty and dealing with the issues in the campaign; Mr. Ben Sweeney who will look after the presentation; Professor Patrick Keatinge who is a leading expert in the Common Foreign and Security Policy and Defence Policy, as well as in the field of scenario building; and Mr. Peadar Ó Broin who is our senior legal researcher and responsible for creating the consolidated and annotated consoliated versions of the treaties, as well as dealing with the legal issues raised in our report.
I would like to introduce the sub-committee to the institute. It is situated in a constituency with which the Chairman is familiar. It is an independent body devoted to the study of strategic policy options arising for Ireland from its membership of the European Union. Our patron is President Mrs. Mary McAleese, while our comité d’honneur includes: the Taoiseach; the European Commissioner, Mr. Charlie McCreevy; the former Commissioner, Mr. Peter Sutherland; and other former Commissioners and Taoisigh. Our president is Dr. Garret FitzGerald. We hold a series of seminars, host lectures and receive distinguished visitors. In an average year we hold approximately 150 to 200 events. We publish a lot; we are a minor publishing house. So far we have published 83 titles — books only. In addition, there are many reports and other papers. We rely very heavily on volunteer support. Mr. Tony Brown and Professor Keatinge appear in that capacity. Mr. Peader Ó Broin is a member of our staff.
There was reference to the sub-committee's mandate. We have had particular regard to the first two elements of that mandate — to analyse the challenges facing Ireland and the European Union following the referendum result and to consider Ireland's future in economic and financial matters, social policy, defence and so on. These are the two issues upon which we wish to concentrate. We have published a report entitled, Ireland's Future After Lisbon, which is broken into eight chapters. Chapter 1 gives the context and is entitled, Background — from Nice to Lisbon 2000-2007. Chapter 2 reviews the issues that arose in the referendum debate because they are vital in assessing some of the scenarios we will examine. In chapter 3 we provide a political context for the scenarios, particularly at European level. In chapter 4 we offer eight scenarios for the future. We provide a legal analysis of them, an economic and political analysis and then, as one would expect, look at the consequences of a second "No" to the Lisbon treaty. We then draw certain conclusions.
It is important for me to say our focus throughout is on the national interest. The argument is based on the logic that the basis on which we sought membership in the first place was to protect the national interest. It was defined in very specific terms by the then Taoiseach, Mr. Seán Lemass, and reiterated by former Taoiseach, Mr. Jack Lynch, when he reactivated Ireland's membership of the European Economic Community at the end of the 1960s and early 1970s.
We are very conscious of the nature of the European Union. This is our point of view and point of departure. It is very important to emphasise that this is how we approach the analysis of the various scenarios. We see the European Union as a treaty based organisation involving democratic states which have voluntarily opted to share sovereignty in accordance with rules and procedures laid down by law. Hence, the treaties are absolutely central to the life of the European Union. It is a unique experiment in interdependence. Seeing it in any other guise would be a grievous mistake. We emphasise the voluntary nature of the Union. Member states apply to join. This country applied to join. It might be said, if I can be forgiven for saying so, and would be historically accurate to say we, Seán Lemass in particular, pressed our case extremely strongly at the time.
On a voluntary basis member states take on membership responsibilities in return for what they see as political and economic benefits. The European Union operates on the basis of consensus among the member states. We also see the process as dynamic. It never stands still. It proceeds on an iterative basis; there have been six treaties. It constantly widens its remit; there have been five enlargements. It constantly deepens its co-operation; the last treaty at Lisbon was designed to meet the challenges of the 21st century, including, for example, climate change. It was intended to settle the institutional structure of the Union for some considerable period ahead, almost for a generation, to quote some. This is a very important background and flavour to the scenarios outlined.
In terms of scenario building, it is an exploration of alternative futures. It is not a prediction. These are things that could happen, but we are not saying they will. If the methodology is to work properly, we must examine all the options, all possible futures. Then, on the basis of expertise and common sense, a certain ranking will emerge among the scenarios from the point of view of those who have read the report. We are not ranking. Presumably, people will do this themselves. Our standard methodology is that we look at options. We try to analyse the implications of each. We do not make recommendations. We leave it up to the body politic to make up its own mind. The national interest is the basis of the report, its focus and centrepiece. We see it, as defined by Seán Lemass, as based on two extraordinarily simple but apt and relevant propositions. Economic development depended on full membership of the then emerging EEC and economic development would, in turn, ensure social progress. As far as we can see that policy has remained unchanged since 1961. It was done in the full awareness, as Mr. Lemass said, of the political aims and objectives of the Rome treaty and he undertook that Ireland would participate fully in shaping its political development. Outside of it, Ireland would be isolated. There is a predicament confessed by all leaders of other member states and us between the electorate's decision and the wish of the other member states to proceed with the ratification of the Lisbon treaty. At this point, 24 of the member states have completed parliamentary ratification. The 25th, Sweden, is about to do so on Thursday. At this moment, we reckon that 6,610 parliamentarians in national parliaments throughout Europe have voted to ratify the treaty and 810 have voted against. There will be additional members in Stockholm on Thursday.
Mr. Lemass had promised that Ireland would work in a spirit of loyal and constructive co-operation to deepen the progress of the Union. The question arising from the referendum is whether this signals a fundamental change in Ireland's policy, which has been in place for 50 years. Since June, we are aware that much has changed in a short period and this influences one's approach to the scenarios. There has been a conflict in the Caucasus and a renewed belligerence in Russia's foreign policy. This has had a profound effect on the states in central Europe and the Balkans. In addition, there has been financial turmoil in the capital markets and the onset of economic depression, not recession. This has reorganised the agendas of every member state and made the Lisbon treaty more relevant to them than it had been last June. The other members are waiting for Ireland to come up with some indication of what its response will be, as is clear from the Presidency conclusions in June and October.
I will skip over how we got here. We know there has been a debate over the past eight years on these issues. Everything has been debated and we are now attempting reconciliation between the positions of the 27 member states.
We envisage eight scenarios, divided into two groups. In one group, the scenario originates from the other member states or the Presidency of the Council. The other group of four originate from action initiated by Ireland. In the case of the first group, the first scenario is the abandonment of the treaty. The second is an agreement to renegotiate, the third an initiative on behalf of the Presidency and the fourth failure to agree on some common way forward leading to a break-up of the current Union. The scenarios emanating from Ireland are that Ireland would seek a protocol, that it would make a declaration, that it would secure opt-outs or that it could not and would not ratify the treaty.
In the first scenario, where the treaty is abandoned, on the basis of existing treaties, we would carry on reflecting a legal reality that the Lisbon treaty cannot come into force unless it is ratified by all member states. However, there are compelling reasons why other member states are not likely to take this course of action. Enlargement is one reason because Lisbon is regarded as essential for the next enlargement, involving the Balkans, the cockpit of Europe and the cause of so many problems over the past century and a half. The status quo is unlikely to prove attractive in the light of the new political, economic and security agenda of member states.
Full-scale renegotiation, the second scenario, requires the unanimous agreement of the political leaders of the other 26 states. It might involve another convention. It would almost certainly take about two years at the very least to negotiate. It would require a new ratification process in all the other member states, including Ireland. It would be difficult to construct an agenda, particularly from the point of view of Ireland, for the renegotiations. This leads us back to the debate we had. We identify at least 30 major issues that arose on the "No" side during the course of the campaign. To construct them into a coherent point of view would be very difficult since many of them are self-contradictory. The task of the Irish negotiators would be uniquely difficult. It would have to be a renegotiation acceptable to all the other member state governments and certainly would have to be ratified by all of them.
The idea of a Presidency initiative has arisen in the context of the French Presidency. President Sarkozy gave an indication along these lines when he addressed the European Parliament recently. It was a point of view taken up and repeated by his Minister for Foreign Affairs. The words used were "road map" which the Presidency might feel compelled to sketch as being the way forward. We divide the Presidency initiative scenario into two sub-scenarios, one of which is definitive and the other, persuasive. In the definitive sub-scenario a member state such as Ireland is being told what is required of it, whereas in the persuasive sub-scenario it might be a case of spelling out the facts and telling Ireland this is what they might like us to do. Whether the French Presidency will actually do this is a matter of judgment for it, probably at the next European Council meeting in December.
Should there be a failure to agree on a common way forward, one must factor in the fourth scenario, the break-up of the European Union in some way or another. Its structure is what we call "unicity". This would change in either of three ways: there could be a multi-speed Union, a multi-tier Union or the Union could fragment. The difference between a multi-speed and multi-tier Union is very important. It is something at which we have been looking for more than ten years and we have analysed it in various studies. In a multi-speed Union some member states would move ahead faster than others but the others would commit themselves to catching up at some future date. They would all use the common institutions, the Council of Ministers, the Parliament, the Commission and so on and the decision-making processes laid down by the treaty. This could be done on the basis of enhanced co-operation. In a multi-tier Europe, however, some of the existing member states would opt for an outer core. They would decide not to use the full acquis communautaire and indicate areas in which they would not participate. They would not, therefore, use the common institutions, whereas the inner core would. It is possible to have two or three outer cores; this is quite conceivable. There would then be a permanent division into a core and non-core European Union. If things got really bad, fragmentation would occur, where the inner six might lead a group which would carry on with a new form of integration leaving others following behind in their wake or simply to disappear into some outer core. There certainly have been strong hints of this during the years of dissatisfaction with the Union becoming too big and new member states holding back the process of integration. This is something of which we in Ireland have always aware. Were this to happen it would mean life outside the centre. This would be uncomfortable, unprecedented and certainly involve a loss of influence and goodwill. It would also damage the coherence of the Union as a whole and the Union as a whole would certainly suffer economically at a time of great stress and difficulty.
As regards the scenarios for Ireland, it could be the case that it might first seek a protocol which would be appended to the treaty and could consist of declarations, clarifications and opt-outs. It would be legally binding. If a protocol was negotiated at an IGC prior to its conclusion, it would form an integral part of the treaty. If it was negotiated after the treaty had been concluded and ratified by some member states, it would in fact be a separate treaty, even though it might be regarded as a protocol to the Lisbon treaty and would have to go through the entire ratification process. There is no precedent for the addition afterwards of a protocol once a treaty has been concluded and, in some cases, ratified. It is in effect a mini-renegotiation. The difficulty with that is that it opens up Pandora's box because other member states may request protocols for their national issues. There is also the possibility of political opposition when the reratification process goes back to national parliaments.
There is the possibility of a declaration which has a precedent. A declaration is a formal statement by a signatory to a treaty. Ireland used this mechanism after the defeat of the first referendum on the Nice treaty. A unilateral declaration by Ireland would be a political act which would clarify rights and obligations. Going on the precedent of the Seville Declaration, it would be matched by a corresponding declaration from the European Council. The European declaration after the Seville summit contained references to neutrality, the common foreign and security policy and common defence. It was declared that Ireland would associate this declaration with its instrument of ratification. For its part the Council made a parallel declaration which took cognisance of the Irish decision and clarified provisions on common defence. It also noted it was a sovereign decision to commit military personnel to European events.
It must be made clear, however, that a declaration is not a legal instrument. It is a solemn statement which we would regard as politically binding. It does not require ratification and, hence, in current circumstances would carry a certain attraction for the other member states.
A declaration could be much more than previous ones, containing statements on Ireland's understanding of the nature of the European Union itself. It could restate Ireland's European credentials and recall the basic principle and values upon which the Union was founded. It could clarify Ireland's position on certain matters of concern and refer to specific issues such as taxation and the Commission, for example. It could be styled as "Ireland in Europe and Europe in the world". This would mimic to a certain extent the precedent adopted by the Danes after their rejection of the Maastricht treaty.
The last option is the opt-out which would require unanimous agreement with the other EU leaders. Ireland would define its own area of opt-outs to which they would have to agree. These opt-outs would be associated with the instrument of ratification. In effect it boils down to partial adherence to the Treaty of Lisbon.
There is the Danish precedent after the rejection of the Maastricht treaty. Then, the Danish Government, political parties and Parliament took the approach of coming up with a Danish solution to a Danish problem without creating problems for other member states. It was flanked and matched by a decision of the European Council to agree to those opt-outs, one of which concerned the euro. The evaluation of an opt-out is that it is not a renegotiation and does not, therefore, require ratification. It applies only to the member state which issues it but it has a legal effect on that member state.
Ireland has not regarded opt-outs without any degree of favour. It has seen opt-outs as a way of losing influence in particular areas. In the report, the two possibilities of opting out of defence and the charter are dealt with in some considerable length.
Ireland could decide not to ratify the Lisbon treaty for reasons of political judgment. This would presumably require political consensus, given the significance of the decision. It could set off a chain reaction, leading to whatever scenario one can imagine. If the Lisbon treaty is not ratified, no provision exists for Ireland to be expelled from the EU under the existing treaties nor is there any mechanism whereby Ireland could resign should it so wish. The treaties are treaties in perpetuity. However, law is the instrument of politics. If the political will was leading towards a certain solution then the legal means would be found for it. We referred to the Danish White Paper after the Maastricht treaty as a precedent for this, in which the then Danish Government considered the possible withdrawal of Denmark from the then European Economic Community should there have been a second "No" vote to the Maastricht treaty. In this case they posited that Denmark would then opt into the European free trade area, which provides a mechanism for linkage with the European economic area, and this they saw as the alternative. They described this as an extreme solution, it should be said. The evaluation of this possibility is that some member states might object to this procedure. They might not press for Ireland's withdrawal or even acquiesce in Ireland's resignation, for example, on the grounds that it would create an unwelcome precedent. Others might use it as a tactic to delay things. There is also the issue that at a certain point it could become an instrument for future enlargement and hence result in a choice between the Balkans and Ireland. I am simply saying we should consider this.
This brings the national interest into play. The national interest is clearly defined in terms of what the EEA would put on the agenda. For example, there is no membership of the Common Agricultural Policy. There is access to the internal market but there is no engagement — no involvement in decision making — so there is no influence. In fact, one must pay a membership fee to get involved in the internal market. There are no transfers which are still of importance. The question of Ireland's engagement or involvement in the eurozone as a member of EFTA and as part of the EEA would be problematic, to say the least. This is very much uncharted territory, but it is certainly something that should be considered as an issue.
What we think the political leaders should consider when they meet is a formula on what they have called a common way forward, which satisfies the democratic wishes of the Irish people, meets the legitimate expectations of the other member states, and protects the key elements of national strategy — that is to say, full participation in the CAP, full involvement in the internal market, full membership of the eurozone and continued access to transfers. The fundamental question with which we conclude our report is whether Ireland wishes to continue with full EU membership. Decisions have consequences. These scenarios, I hope, help to clarify those consequences. I hope this presentation has been of some help to members.
