Oireachtas Joint and Select Committees
Tuesday, 5 March 2013
Joint Oireachtas Committee on European Union Affairs
Forthcoming General Affairs Council: Discussion with Minister for Foreign Affairs and Trade
3:30 pm
Eamon Gilmore (Dún Laoghaire, Labour) | Oireachtas source
I am pleased to have the opportunity to brief the joint committee ahead of the next General Affairs Council, which will take place in Brussels on Monday, 11 March. This is the second General Affairs Council of Ireland's EU Presidency and I will again have the honour of chairing the meeting. The Minister of State at the Department of Foreign Affairs and Trade, Deputy Creighton, will represent Ireland. The agenda is still being finalised but discussion is expected to focus closely on preparations for the European Council on 14-15 March. The European Council is expected to discuss the conclusion of the first phase of the European semester, the implementation of the compact for growth and jobs, economic and monetary policy and strategic partners. President Van Rompuy will join Ministers for the final hour of the meeting.
We are now one third of the way through Ireland's EU Presidency and I believe we can justifiably take some pride in our achievements to date. The Presidency remains a whole-of-government effort and Ministers and Departments are pulling together. We are making a contribution to taking Europe beyond the crisis. Only last week, two landmark breakthroughs were brokered by the Irish Presidency. First, the agreement on capital requirements, responding to the concerns of citizens and government about the unbridled bonus arrangements which impacted on the risk profile of the banking system. Bonuses will now be regulated in a sensible way and this focus on reducing risk and preventing future crises is in line with the Irish Presidency priority on banking union. Second, the agreement on the youth guarantee which, when implemented, will assure young people under the age of 25 years of a good quality offer of employment, continued education and an apprenticeship or a traineeship within four months of becoming unemployed.
We have made important progress on the two pack on economic surveillance. Washington and Brussels have given the green light to working towards an EU-US trade agreement. There is agreement on the multiannual financial framework, MFF, for the period 2014-2020. We supported President Van Rompuy in his work to achieve agreement at the European Council in February and we will now take forward the vital task of securing agreement with the European Parliament. We have had productive meetings with the key players already. The Taoiseach and I, together with the Minister of State, Deputy Creighton, met Presidents Schultz and Barroso in Dublin last Thursday and we now have a clearer picture of where each of the players stand. The challenge ahead will not be easy but I am confident that with goodwill on all sides we can reach agreement. Timely implementation of the MFF is critical to underpin recovery throughout the EU and to facilitate implementation of vital programmes, including Horizon 2020, the programme for the competitiveness of enterprises and SMEs, COSME, and CAP, and the Cohesion Fund and regional funding.
I thank committee members for their engagement in the Presidency. In particular, I welcome the committee's launch of a national debate on the future of the European Union. I hope this initiative will spark broader debate about what it means to be part of the EU and how we want it to evolve in coming years. This ties in well with the European year of citizens, launched in Dublin in January. I look forward to hearing about the views submitted and ultimately to hearing the committee's assessment of the challenges and opportunities facing us in future.
The Taoiseach will co-chair the tripartite social summit immediately before the European Council. This will provide an opportunity to discuss with the social partners the importance of addressing challenges to recovery and the renewal of the EU social dimension.
Discussions at the General Affairs Council will focus on preparations for the March European Council, which is expected to be dominated by economic issues. Our Presidency is committed to the effective implementation of the European semester, the EU system of economic and budgetary co-ordination, which we see as a key tool in restoring economic stability and creating conditions for sustainable growth. The March council will conclude the first phase of European semester 2013. The key output is guidance to member states on the preparation of their stability programme updates under the Stability and Growth Pact and their national reform programmes under the Europe 2020 strategy. The semester is the basis for building a common understanding about the priorities for action at EU and national level as Europe seeks to return to sustainable growth and job creation. The key EU-level focus is on supporting the development and implementation of jointly agreed priorities. The key national-level focus is on bringing about a stronger alignment of budget priorities, employment policies and structural reforms.
The effective management of the semester is an important focus for our Presidency, as committee members will be aware. I will present to the General Affairs Council our Presidency synthesis report of discussions on the annual growth survey. This will see a strong reinforcement of the five priorities identified by the Commission: pursuing differentiated, growth-friendly fiscal consolidation; restoring normal lending to the economy; promoting growth and competitiveness for today and tomorrow; tackling unemployment and the social consequences of the crisis; and modernising public administration. It is crucial that we keep up the momentum behind national-level reforms in these areas as a basis for sustainable recovery. Such reforms include integrating the green economy and resource efficiency agenda into economic decision-making; exploiting synergies between the transport, energy and communications sectors; reinforcing the digital agenda; and obtaining better outcomes from research and development investments.
Discussion will also be informed by last week's agreement by Ministers at the Employment, Social Policy, Health and Consumer Affairs, EPSCO, Council on the youth guarantee. The success of the Minister for Social Protection, Deputy Burton, in obtaining consensus in this area has delivered an important Presidency goal. I acknowledge that the committee shares my concern on levels of youth unemployment throughout the EU. Currently there are 7.5 million young people in Europe not in employment, education or training. This amounts to 12.9% of those aged 15 to 24 years. As the Minister, Deputy Burton, said last week, the economic and social costs of this are simply devastating. Youth unemployment can have lifelong effects and the youth guarantee is a key vehicle for mobilising support. As I have stated, once implemented, it will ensure young people receive a good quality offer of employment, continued education and an apprenticeship or a traineeship within four months of becoming unemployed.
It will also contribute to three out of the five Europe 2020 targets, namely, increasing employment, reducing early school leaving and removing people from poverty and social exclusion. Although each member state faces different implementation issues, progress should be supported by the €6 billion youth employment initiative under the MFF agreement. It was clear from last year's lessons learned exercise that the European semester should be an open and inclusive process which supports meaningful engagement with parliaments and all relevant stakeholders at European and national levels. I therefore acknowledge the work done by this committee on enhancing parliamentary involvement in European semester processes and in particular the COSAC meetings of parliamentarians from across Europe. Stronger economic governance has to be accompanied by stronger democratic legitimacy and I commend members for their work in this area. It is a valued input to our Presidency programme and I expect it will provide a good basis for exploring others ways of involving national parliaments in the European semester.
The spring European Council will also take stock of progress in implementing the compact for growth and jobs. This means EU level action and, in particular, backing up the more country-specific aspects of the semester process. It is a close fit with our Presidency's emphasis on the Single Market and external trade agendas. As members will be aware, we are prioritising agreement on the key Single Market Act I files that remain open, while aiming for as much progress as possible on Single Market Act II files as they are published over coming months. For the first time the monitoring of Single Market governance will occur within the framework of the European semester.
We have also made a good start on the EU-US trade relationship and will be working hard to get a formal Council mandate for free trade negotiations in time for the June Foreign Affairs Council. The financing needs of the real economy are another crucial issue in terms of EU level actions supporting growth and jobs. This means restoring normal lending conditions and unlocking productive and growth enhancing investments. The EIB will continue to play a crucial role in this regard. The reality is that we will have recovered from the current crisis only when our economies are growing again and creating jobs. That remains our most important test.
The European Council will look again at the process of strengthening EMU, although the next major discussion on this is scheduled for the June meeting when President Van Rompuy will present his roadmap following consultation with experts, member states and social partners. A stronger and more robust EMU will help to underpin confidence and contribute to economic recovery. While we have seen greater stability in the markets in recent months, there is no room for complacency and we must make the most of the period of relative calm to do what is necessary to ensure that we do not return to crisis. While in the Presidency we are continuing to support President Van Rompuy's work, including facilitating discussion among Ministers in the relevant Council formations. Although the March meeting may reflect on aspects of this work, the main focus will be on a range of ongoing and pending structural reforms to strengthen economic governance.
On banking union, a number of key decisions have already been taken and further progress remains a Presidency priority. A significant volume of legislation is involved and we are working for successful discussions with the Parliament and Commission on the single supervisory mechanism. Progress in this area will send a positive signal on subsequent reforms of economic policy. The intention remains for the ECB to be in a position to take over supervision on 1 March 2014. Crucially for Ireland, direct recapitalisation of banks by the ESM would then become possible. The aim for the bank resolution framework is to secure agreement in the Council and the Parliament by June. We also hope to reach agreement on deposit guarantee schemes by then.
I highlighted the capital requirements package earlier. This landmark agreement was brokered last week by the Irish Presidency with the Parliament and Commission. These were difficult negotiations and the Minister for Finance, Deputy Noonan, has done well to balance many different and competing interests. The new rules should provide greater stability and ensure that European banks hold sufficient capital to withstand future shocks.
The March European Council is also expected to welcome the agreement on the two pack economic governance legislation, which was brokered by our Presidency with the Parliament and the Commission. This is designed to improve budgetary and economic co-ordination among euro area members and will contribute to greater stability and confidence. Taken together, these reforms should lead to a more stable, robust and resilient economic and monetary union. The European Council will also discuss its strategic relations with external partners. The main focus is expected to be on relations with Russia but written conclusions are not anticipated. I appreciate the attention of the committee and I look forward to hearing members' comments. I will, of course, be very happy to respond to their points or queries.
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