Vote 28 - Department of Foreign Affairs (Supplementary)

I remind members to ensure their mobile phones are switched off completely for the duration of the meeting, as they cause interference with the recording equipment in committee rooms, even when on silent mode.

The purpose of today's meeting is to consider the 2010 Supplementary Estimates for public services, Vote 28, Foreign Affairs, subhead I - United Nations peacekeeping operations. The following order was passed by the Dáil on 24 November 2010, "That subject to leave being given to introduce the following supplementary Estimate for the service of the year ending 31 December 2010 - Vote 28: Foreign Affairs, Supplementary Estimate - the Supplementary Estimates be referred to the select committee, pursuant to Standing Order 153(3) and paragraph 1(a)(ii) of the committee’s orders of reference, which shall report back to the Dáil no later than 2 December 2010”. This order facilitates the consideration by this committee of subhead I, United Nations peacekeeping operations. A proposed timetable for today’s meeting has been circulated to members. It allows for opening statements by the Minister and the Opposition spokespersons and then for an open discussion on the subhead by way of a question and answer session. Is that agreed? Agreed.

On behalf of members, I welcome the Minister for Foreign Affairs, Deputy Micheál Martin, to this meeting. He is accompanied by his officials. I welcome Mr. David Cooney, Secretary General, Mr. Barrie Robinson, assistant secretary corporate services division, Mr. Michael Gaffey, deputy director general of the development co-operation division, Mr. David Donohue, director general of the political division, Mr. Pat Kelly, counsellor, political division, and Mr. Tim Conlon, policy adviser. Briefing material provided by the Department has been circulated to members. I now invite the Minister to make his opening statement.

I thank the Chair and the members of the select committee for agreeing to consider this Supplementary Estimate for subhead I, Vote 28. It is a relatively rare occurrence for a Supplementary Estimate to be needed on this Vote. However, with the general tightening of allocations to my Department in recent years, it has become more and more difficult to accommodate exceptional items within the general voted moneys.

This Supplementary Estimate is sought now to enable Ireland to meet its obligations towards a number of international organisations, particularly costs emerging as a result of United Nations peacekeeping operations. UN peacekeeping costs are met through the contributions of all UN member states at defined contribution rates, based primarily on economic scale and level of development. These contributions are essential to enable the UN to undertake its peacekeeping operations and provide for reimbursement of some of the costs incurred by countries participating in UN peacekeeping missions, including Ireland when we do so. Members may be aware that a proposal for renewed Irish participation in UNIFIL is under consideration and costs arising from this mission will be recouped from the UN. The UN's capacity to reimburse troop-contributing countries depends entirely on its member states' fulfilling their financial obligations to the organisation in full and on time.

The importance of the UN's role in maintaining international peace and security does not need to be emphasised. At present, approximately 100,000 troops worldwide are serving on 15 current UN peacekeeping missions in a range of conflict-affected regions, from Darfur in Sudan to the eastern DRC, Haiti, Lebanon and Kosovo. The conduct and operation of these peacekeeping missions relies directly on UN member states' fulfilling their financial commitments. Ireland has always taken its obligations arising from UN membership seriously. Accordingly, it has been the practice of all Irish Governments to make our assessed payments to the organisation in full and on time.

Due to the nature of peacekeeping activities, UN peacekeeping costs are difficult to forecast and generally arise on a somewhat irregular basis throughout the year. Determining factors include the timing and nature of the renewal of the mandates for existing UN peacekeeping missions as well as the overall range and scale of peacekeeping operations undertaken by the UN. Member states receive a large number of individual peacekeeping assessments throughout the course of the UN peacekeeping financial year, which runs from 1 July to 30 June. These assessments reflect the costs of the missions being undertaken, to be divided between all members, and are subject to wide variations. In addition, the assessments are denominated in US dollars, which exposes my Department to an unavoidable currency risk. The combination of these three variables - scale of mission, timing of assessment and exchange rate variations, make it very difficult to estimate in advance the total contribution for a calendar year.

In the Estimates for 2010, Dáil Éireann allocated €37.2 million towards subhead I, approximately equal to the out-turn for last year. The 2009 allocation had been €42 million, yielding savings of some €5 million for 2009 which was returned to the Exchequer. In the current year, some of the variables I mentioned have worked against us. The overall number of missions has increased and some, such as the UN mission in Haiti, have expanded considerably. For much of the year the euro rate of exchange with the dollar was unfavourable. The year 2010 has also witnessed the commencement of a new scale of contributions for all members, which has had the effect of increasing the proportion of each mission to be paid by Ireland. The cumulative impact of these developments has been to increase the estimated outturn for Ireland's contribution to peacekeeping operations from €19.6 million to €34.7 million. In turn, the estimated total outturn for subhead I has increased from €37.2 million to €52.4 million. The exact total will not be known until the final payments are made, as even in the past week the euro-dollar exchange rate has shifted significantly.

I have made every effort within my Department to husband our available resources during this past year. As the scale of the increased costs of UN peacekeeping emerged, I attempted to identify savings within the Vote. I have identified €1.3 million in current expenditure that might be directed towards the shortfall. Some €300,000 comes from the administrative subheads and €1million from the funds set aside for the emigrant support programme, subhead C. In assigning this money to meet the peacekeeping operation contributions, I assure the committee that grants to front line organisations were not substantially reduced this year. Savings arose due to reduced investment in community capital projects. I regret this, but in the current climate some difficult choices had to be made. Priority will always be given to front line organisations providing services to the most vulnerable. Last year we also had some exceptional capital items on the emigrant support programme which did not recur this year and that allowed us some leeway.

In addition, I have decided not to proceed at this stage with some necessary capital investments in departmental infrastructure, which I again regret. This has freed up a further €1.5 million towards our UN obligations. In total, I have identified savings of €2.8 million in Vote 28, which with the committee's approval I will make available for subhead I. This still leaves a shortfall of more than €12 million to be found. In discussions with the Minister for Finance, I have accepted that, in the light of the extremely difficult position of the public finances, expenditure under Vote 29, which funds our ODA programme, can be capped at the level necessary to offset the amount of the Supplementary Estimate now required. In other words, we will reduce the ODA side by €12 million. While this means that the net cost to the Exchequer of the Supplementary Estimate is neutral, I regret that it means that total expenditure on ODA by my Department will be reduced. This decision has not been taken lightly, and the Government's commitment to ODA remains strong. Given the likely outturn of GNP for Ireland in 2010, I am confident that the target level of ODA at 0.52% will still be reached.

I have attempted to provide the committee with the background and reasoning behind the current request for a Supplementary Estimate. I have also outlined the measures I propose to take to offset the increased contributions. They are unfortunately not without impact. In other times, it may have been possible to source moneys elsewhere within the system to meet the unexpected developments. However, as I indicated at the outset, the nature of the budget for my Department is now so tight that there is little flexibility to respond to issues such as the one before us.

I thank the committee and am happy to answer any questions members may have.

I fully support Ireland's involvement in peacekeeping missions and I support the concept that the cost of missions should be borne by the United Nations and that member states should make their contribution in accordance with each nation's ability to do so. If this were not the case it would exclude many African countries in particular from participating in peacekeeping missions. This would be a shame because it is necessary for peacekeepers to understand the difficulties of the locality and to have some in-built concern to see a solution to a given problem. Therefore, I do not have any difficulty with Ireland contributing to the overall cost of the United Nations peacekeeping missions.

I find it difficult to agree with this money coming from the Department of Foreign Affairs budget. It should be a matter for the Department of Defence. I will support the Supplementary Estimate because I understand perfectly the reasons for it but it is very unfortunate that in doing so, we have to reduce the amount of overseas development aid. In those circumstances, an attempt should be made to recoup, if possible, any moneys from the other Departments, including the Department of Defence.

Ireland's target for ODA is 0.7% of GDP by 2015. We entered into this agreement and we must uphold our reputation in that area. We are making life extremely difficult for ourselves by having to dip into that money on this occasion. We are also using moneys that were available for our various brothers living abroad, such as support for Irish emigrant services. These moneys are particularly necessary in these hard times.

I ask the Minister to say if any efforts were made to seek some support from the Department of Defence, even though I am a former Minister for Defence. I imagine the Department will say it has no money but I wonder why we have to continue using the Department of Foreign Affairs' moneys to provide for our commitments to the UN peacekeeping missions. Whatever about contributions to the OECD and other organisations, when perhaps the Department of Foreign Affairs would be the appropriate Department, the Department of Defence would appear to be the appropriate Department to make this contribution, unless there are reasons of which I am unaware but which the Minister could tell me.

I do not wish to delay matters as there is much to be said and we can deal with matters on another occasion. It highlights why Ireland and the EU should have greater influence at UN level. We are significant contributors to UN funding. I am fully committed to the concept of the EU and Ireland playing a leading role in supporting Europe through the United Nations. It is the only building I know where nations gather which happen to be at loggerheads with each other. The United Nations should be strengthened and maintained at all costs. Now that Ireland is a fully-fledged member of the EU, we should battle for more influence on the part of the EU in the decision-making process. The UN Security Council is completely out of date with five permanent members. Very often, the United Nations has been starved of its funds by some of the major nations having a big say. We should be proud that Ireland makes every effort to pay up on time. As a result, we should be able to point out to others that they should do likewise, particularly in these hard times. This gives us an opportunity to show leadership. I sincerely hope the Minister will make our views known throughout the European Union and at UN level.

I regret that we have to dip into the funds of our overseas development aid. I ask the Minister to confirm that this is the only way we can do it. Has Ireland made any requests for a cross-transfer of funds? This should be the last resort. We are slipping behind in our commitments. There is general public support for our contribution to overseas development aid and we should do everything possible to keep to our commitments.

I have no difficulty in supporting the Supplementary Estimate for subhead one and Vote 28. I note the Minister's remarks. I will take up some of the points made by Deputy Barrett. On previous occasions when the committee discussed matters not exactly like this, we sometimes had the presentation of the outstanding amounts that were due by major countries to the United Nations for such services as are provided for peacekeeping. Ireland was regularly owed money. This is not a criticism of the United Nations but rather a criticism of some of the large countries which exert a disproportionate influence in the UN Security Council but not an equivalent interest in settling their debts with the United Nations for agreed missions.

With regard to the general Estimate for the Department of Foreign Affairs, Deputy Barrett referred to overseas development aid, but it is important to emphasise that it is one of the outstanding contributors to our reputation abroad. It is also important at this time, when so many people talk down the country, that anyone who looks at the history of our foreign policy will know the disproportionate influence of Ireland because of its interest in the moral content of diplomacy and the moral importance of the United Nations. We have a great deal to gain from having a good strong Department of Foreign Affairs.

I wish that in more affluent times we had developed our connection with regions that are very important, including the nuclear-free region of South America, where significant changes are taking place, such as the replacement of military regimes by movements that are often coming from the base of society. We are not sufficiently represented in South America. This is not a criticism but it is a case of resources.

An objective observation of overseas development aid would point correctly to the disproportionate cuts in the funding. In 2009 and into 2010, the Department of Foreign Affairs funding cut is 26%, with overseas development aid at about 27%. The Department of Defence, to which Deputy Barrett referred - he is a distinguished former Minister - took a cut of 11%. As we run our eye across the Departments and look at where contributions have been made, we see that the Department of Foreign Affairs has taken more than its share of the pain, and overseas development aid - we have important international commitments - has taken cuts too. It would be of assistance if, in the consideration of the four year plan, we had some specific information about how our commitment to 0.7% of GDP will be met. I wish we were not achieving it by shrinking the economy but because of the way percentages and proportions work and because things are so bad, we might in fact be gathering speed. I do not want to waste time by talking against anything proposed here. It would be a pity if a false division opened up between matters of austerity at home and what we have been able to achieve abroad.

As a former member of Cabinet, I have always been very struck by the quality of what we deliver by way of constructive contributions at the discourse level. Equally, in the representation in parts of the United Nations organisation we have a very distinguished record. It is quite miserable of those who suggest that one must make a choice between responsible spending at home and playing a part in matters such as peacekeeping. Our military personnel who return from such missions know what it is like to live in a zone of conflict and have represented us responsibly. In whatever part of the world they have been, Irish-led missions have been noted for their sophistication and intelligence in handling difficult situations. I am happy to agree to the Supplementary Estimate on behalf of the Labour Party.

I support the Supplementary Estimate but regret very much that the ODA budget has been reduced. Despite the financial difficulties we have at home, when one considers the extreme poverty in developing countries, one can see it is important to ring-fence the Irish Aid budget. How many UN member states are not fulfilling their financial obligations on time at this stage? Can anything be done at UN level about the exchange rates? I presume it is difficult, but given that so many countries are trading in euro, is there some way to address that issue that would be of benefit in terms of the exchange rate?

I also support the Estimate. As my area is overseas development aid, I am disappointed that budget needs to be reduced. We have always had a very strong commitment to our overseas programme in peacekeeping and I agree with the proposal in that regard. I ask the Minister to explain how the reduction in ODA can be made up and if we can reach our target level by 2014.

I thank members of the committee for their constructive contributions and their support for the Supplementary Estimate. I appreciate the regrets they have articulated that the savings are being primarily achieved through an offset in the ODA budget.

Over the past two years we have been reducing the emigrant support programme, which is down to €12 million this year and was €15 million two years ago. Last year we made two once-off capital grants. I allocated €2.3 million to the New York Irish Arts Center. New York City gave €10 million or more and the centre will be a state-of-the-art facility and showcase for Irish theatre in New York. We also allocated two other substantial capital grants in Phoenix and Chicago. As they do not recur this year, it gave us some leeway. We are not making a similar range or volume of capital grants to organisations this year. That enabled us to save approximately €1.5 million on that front this year.

We have saved €2.75 million on ODA administration expenditure this year, mainly on travel and consultancies, which leaves approximately €9.6 million. We are delaying some elements of the bilateral programme into 2011, which will avoid cuts in that programme. Next year's allocation should enable us to maintain the bilateral programme at the levels we have agreed. We are very anxious to protect the bilateral programme to support the programme countries in which we are engaged. This year's target of 0.52% will be met. Members asked about the 0.7% target by 2015, which will obviously be challenging, but it remains our target. I am not mincing my words in saying it will be difficult to do that. Nonetheless, despite the severity of cuts across Departments and notwithstanding what Deputy Higgins said about us having taken significant slices from ODA in the first two years, we are still at a very significant level and are still one of the top contributors per capita and will remain that way.

However, the Minister's area is taking much of the pain.

There should be an end to that now.

I believe we are levelling out and this year's Estimate and budget will reflect that.

Deputy Barrett made a helpful suggestion about raiding the Department of Defence's piggy bank. The peacekeeping costs arise from our UN membership and obligations, which are the responsibility of the Department of Foreign Affairs. The policy element and international relations always have been our responsibility and it is standard practice that costs that emanate from our international obligations to a range of international organisations should be met by us as outlined in subhead I. Where the policy decisions are with the Department of Foreign Affairs, we need to bear those costs. The Department of Defence did not offer any assistance on this occasion nor did the Department of Finance show much flexibility or leeway on that front.

The Department of the Taoiseach used to be involved in piracy in that area on occasions.

I will not go any further than that.

What are the outstanding amounts due from other countries?

I do not have that, but we will get that detail of the state of play of other UN members meeting their obligations and forward it to members.

Deputy Higgins raised a number of other issues. I have always been of the view that there needs to be a decent debate about our international representation abroad. While we have the an bord snip nua report and all that, we are an exporting country that depends on trade and our mantra is that we must trade our way out of this crisis. When I worked in the Department of Enterprise, Trade and Employment with IDA Ireland and Enterprise Ireland, it always struck me how light our international footprints are. When I pointed this out to the CEOs of IDA Ireland and Enterprise Ireland, they would sometimes look at me as if I had two heads. Irrespective of party politics, strategically we need to look critically at where we are in the world and where our strengths lie. We achieve a considerable amount for the numbers we have. I am not suggesting that we should flood the world. We need to consider what we do and do it well because sometimes small is beautiful and even though the numbers are small the quality of what we have is very strong in embassies, consulates and in various organisations in key locations. I think we need to think about it strategically. The savings in that area are quite small in the overall context. If one closes an embassy, one will save between €500,000 and €750,000 in some cases. That is about as much as one will achieve.

It was proposed in what was known as the Asgard list. That was before the Asgard II sank.

Yes. Certain people have a sort of attitude that "they are all great swanning around the place".

Such people have no familiarity with what is happening in this area.

They are misguided. The Oireachtas needs to make it clear that it wants Ireland to have effective and strong representation of a high quality overseas, in order to drive home Ireland's message and to achieve for Ireland.

In our report, we stressed the central position of the Department of Foreign Affairs and the importance of its development.

I appreciate the committee's leadership.

It is hugely important.

Indeed. Deputy O'Hanlon raised the reduction in overseas development assistance. He also spoke about the obligations issue. We will get that material for the Deputy and the other members. There is nothing we can do about the fact that we are vulnerable to fluctuations in exchange rates. There is no sign of any major sort of new framework to accommodate that in the future, unfortunately. That is a factor.

I would like to ask a question about the 0.7% ODA target. I have raised this matter previously on Question Time. What is taken into account? Surely it is not just cash that should be taken into account. Somebody told me that the OSCE uses a formula to determine-----

One can use the list of criteria or benchmarks compiled by the OECD's development assistance committee to measure one's-----

One could argue that peacekeeping is a form of aid.

It is never included.

We are always being the good boys. We stick strictly to the criteria. At times like this, we do not want to allow anyone to suggest we are reneging on our commitments. We need to make it clear that we are doing other things that are equally important. It is important that we continue to engage in peacekeeping missions, even in hard times.

Peacekeeping is as important as some of the other forms of aid that are provided. In fact, it is more important than many of them. We should be getting credit for this. It should be part of our target. Perhaps the Minister will take that up.

We have taken it up.

We need to be absolutely certain that we can include this. We should be able to include it.

At the same time-----

Can I finish? I accept the merits of the 20% hunger target. Many other activities in the overseas development assistance sector do not relate to the question of hunger. The Minister mentioned emigrant services, for example. It is grand to be contributing to a museum, but I would prefer to see people having beds to lie on.

It is not a museum.

I have no problem with targets for hunger or water supplies, but I think peacekeeping should be well up there.

Before the Minister replies, I would like to say that before we start on the slippery slope of considering how aid is defined, it should be pointed out that the European statistics have never been discussed at length by this committee. Certain countries have notorious statistics. I am encouraged to be very candid these days. The transfer figures for Italy, for example, are most suspect. If one undertook a close forensic examination of some of the strongest economies in the European Union, one might find that what is called "aid" is actually hidden exports. Much of it would raise serious questions about its viability or sustainability. There are things that need to be counted in. It is important to defend the integrity of Ireland's definitions and statistics in relation to aid because it is of great value. Ireland's reputation in this area is very strong, particularly among practitioners. Deputy Barrett is right to say that some of the countries that talk loudest, for example at EU development discussions, have the worst records. They did not accrue their bad figures by accident - they did so consciously.

It is an interesting point. One often hears people asking whether things are "DACable". As the Cabinet was going through possible cuts over the last two years, many Ministers argued that certain things were surely "DACable". One can imagine what was going on. The Deputy's point was articulated on a number of occasions. The Dutch authorities are anxious to ensure that security and military expenditure is covered. Certain pitfalls would be associated with that, of course. One could imagine what would happen in the context of Iraq or Afghanistan, for example. On the other hand, I have to agree with Deputy Barrett that the Irish mission in Chad was essentially a humanitarian mission.

Of course it was.

It was about protecting displaced and hungry people and making sure food got to them. It was not a military operation, per se. I find it difficult to comprehend why such a mission would not be deemed to be an allowable contribution by Ireland, on top of the contribution we are already making. There is room for changes to be made. The devil is in the detail when one is identifying what should qualify and what should not. We should not close our eyes or our minds to it.

Our peacekeeping missions are always carefully chosen. I refer to where we go, what we do and why we do it.

We do not have agendas.

No, we do not have a military expansion agenda or an aggressive role. We have been in certain clear theatres where our presence has been overwhelmingly, if not totally, humanitarian. I think it is a fair point.

Has the Minister concluded?

I thank the Minister and his officials for attending today's meeting. In the absence of any other business appropriate to the select committee, we will conclude. The next meeting of the committee will be convened for the purposes of the Committee Stage debate on the Biological Weapons Bill 2010.