Paschal Donohoe (Dublin Central, Fine Gael)

-----or when he lectures us about budgetary prudence when it was his Government's decisions that led to the IMF coming to this State. Nobody will allow a Fianna Fáil Deputy to lecture a new government about how it should conduct itself, when the legacy of continuous years of the Fianna Fáil Government is the impaired sovereignty of our State. It would be enjoyable to hear the Deputy practice that wheeze were it not for the fact that the consequences for the ordinary people of our State are so savage.

I heard somebody else up on a pulpit today and that person deserved to be there. In his contribution at Arbour Hill, Archbishop Diarmuid Martin used a phrase that struck a chord with me. He said that we have spent a long time thinking about who we are looking for independence from, but not enough time thinking about what we want to use that independence for. As this Government goes through the difficult work of regaining our economic independence and autonomy, it is becoming clearer what kind of State we are doing that for. There are two elements to this. First, we will ensure that we will never again end up with a financial sector whose failure can bring down a State. Second, we will ensure that we have a State that can pay its own way in the world, that is not dependent upon the kindness of strangers to keep our hospitals open or to pay social welfare benefits to 440,000 people who are unemployed. That is the economic dimension of what we need to achieve.

There is a broader definition of sovereignty as well. I have heard it stated many times in this debate that we have lost our sovereignty. We have not lost our sovereignty. The IMF, the European Commission and the European Union are not dictating to us how we should run our schools, what our attitude should be to the killing of Osama Bin Laden, what the rights of children should be in this State, or how we should treat prisoners. What has happened is that a crucial part of that sovereignty has been lost, namely, our economic autonomy. However, there are many other areas of our sovereignty that are firmly within the grasp of this State and its elected Government.

One of the themes that has been continually suggested is that we should not have external bodies in our country, and that we should instead go down the route of unilateral default. I have two questions for those who advocate that action. Where are they going to find the €12 billion that we need this year to keep our schools and hospitals open and to pay the social welfare benefits for those people without jobs? If they cannot answer that question, perhaps they can answer the second question. What schools and hospitals will they close? We are in a situation where the only people who can lend money to our country are these bodies. If we decide that we do not want to do business with them, that is a course of action that no responsible government can incur. It is a strategy which has risks that are so vast that we cannot knowingly pursue it.

When other people make these points, they tend to preface that language by asking about the ordinary person. What about the weak, the poor, the people who suffer? They make those points as if they have a monopoly on representing those people. I also represent those people, as does every other Member of this House. Perhaps it is because I wear a shirt and tie that it is less acknowledged that I do so. I will yield to nobody in stating that my social conscience does not burn any less brightly than anybody on the other side of the House. However, I am clear that a tough course of action must be undergone if we want to look after the weakest in our society. It is in their interests, as much as it is in mine, to make sure that they have schools to attend and to make sure that the social welfare benefits on which they are dependent can be paid next week and for the next few years.

This leads on to another criticism that has been made, which is that this Government is not capable of delivering change. I am always fascinated by this charge when it is made. What automatically happens after we are told that we cannot make any change is that we are criticised for whatever change we do make. We are told that the Government does not want to make that change because it is counterproductive or because it cannot pay for it. That indicates that change has been delivered. It might not be the vast structural change that we are seeking to deliver, but the Government has been in office for a matter of weeks, not years. As Deputy Nash pointed out, the commitment that a new Government would be able to reverse the cut in the minimum wage is being met. This is something the newly elected Government did. Despite the claims of many that it could not be done, it has happened. We were told that we could not put in place additional plans to deal with job creation, and it is going to happen. I guarantee the same people who say that change cannot be delivered within the parameters of this plan are those who will stand up and criticise the change that has been made, and one cannot do both.

I want to conclude on one point regarding the outlook of the State within the arrangement and return to a theme I visited previously, which is what will happen to the State from the summer of 2013 when the European stability mechanism is in place. This mechanism will be very important to the prospects and destiny of the country because it will contain the idea of a collective action clause. That clause will allow, for people buying future debt, that a structured default would be delivered on that debt. The point I want to emphasise is that, for the State, this has the ability to be profoundly self-defeating, the reason being that the target for the State is that it will return to the financial markets at some point in the second half of 2012.

Anybody considering buying our debt at that point will form the conclusion that the debt they are buying might be subject to that stability mechanism. This will force up the rate of interest on our debt as we look to return to the market and that will create severe difficulty for the State. It is a flaw in the mechanism that must be addressed in the coming year and a half to two years that are open. The State can survive that dynamic by ensuring that we need to borrow as little as possible when we get to that point. We cannot allow the State to be dependent on the vagaries of money markets or the kindness of strangers again. In tandem with delivering jobs, which will ensure that the budget will over time correct itself, that is the job of the Government, and it has made a strong and decisive start to making that happen.

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