Dr. Gavin Barrett:

The Chairman's question was very specific and I will refer briefly to it. With regard to financing shock absorption, very considerable resources would have to be provided to make a difference in that regard. The suggestions put forward include national contributions, financing from own resources and a combination of both. The point was made that a key aspect of fiscal capacity would be the possibility for the eurozone to borrow, with common debt issuance. The implications of this should not be underestimated and the paper envisages the setting up of a common European treasury. Perhaps it was the sheer ambition of ideas such as this which led to their not appearing in the Council conclusions. Ultimately, we either want the euro to function or we do not. If shock absorption mechanisms are needed, they must be of an appropriate scale, so perhaps the issue will not stay off the table. If it is put on the table, these are the kinds of thing we will consider.

A number of questions were raised, with democratic legitimacy being one issue and the role of the United Kingdom another. I am not sure I have any particular comment to make on the United Kingdom Independence Party's performance in the latest by-election but it is part of a somewhat worrying trend across Europe in that regard, as well as in the United Kingdom. It is vital to consider the relationship among Ireland, the United Kingdom and the EU. We do not know what will happen in the UK and whether there will be a "Brexit" and, curiously, we are not even sure there will be a referendum on a British exit. As Professor Laffan mentioned, that referendum is promised for the first half of the next British Parliament, at which time Prime Minister David Cameron, if current polls are anything to go by, will probably not be in power. The holding of a referendum is dependent on the Labour Party's acceptance of the need for it, and so far it has been unenthusiastic. The party will be under immense pressure to concede a referendum, although we are not sure what the result of such a referendum would be. There are many issues up in the air with regard to the United Kingdom and I encourage the committee to consider such issues.

The committee should also consider whether there will be renegotiation between the United Kingdom and European Union and the position to be taken by Ireland with regard to concessions. Should we be in favour of repatriation of powers to the United Kingdom, for example, or minor concessions? We must also consider what would happen if the United Kingdom withdrew from the EU. These are crucial issues, and they involve matters such as free movement of powers and the implications for justice and home affairs.

Deputy Byrne and Senator Reilly in particular raised very important questions on democracy and what needs to be done. It is a very difficult problem at a European level, as Europe is where decisions and policy are made in many respects but it is at national level that rewards are reaped. Essentially, policy is at a European level and politics are at a national level. It is very difficult to design an adequate democratic system which copes with that reality. More parliamentarisation may be required, which would make the executive at a European level more responsible to the European Parliament, but that is difficult where individuals identify themselves primarily by national identity and may not feel adequately represented by the European Parliament. That leads to difficulty, and the European Parliament, along with national parliaments, must have a role in that regard.

With regard to democratic legitimacy and accountability in developing the economic and monetary Union, the guiding principle is that democratic control and accountability should occur at the level at which the decisions are taken. That implies that, in so far as there are shifts to a European level, it will be the European Parliament which forms the primary forum for accountability. At the same time, the pivotal role of national parliaments must be included. I can go into further detail on the proposals for legitimacy or accountability in respect of the three areas I mentioned but these are the basic principles. Nobody doubts the crucial nature of the question of democracy and the European Union, and the survival of the European integration project depends on our finding an adequate answer to the question.