Mr. Patrick O'Riordan:

The Commission has only been in office for three weeks, but it has come up with a massive investment plan. It could hardly do more to put out in front its recognition of the need to stimulate demand and encourage investment. New funds have not suddenly been allocated to the European Union which has 1% of the total budget for all public expenditure in Europe. It cannot suddenly manufacture money. With the resources at its disposal, it has done the maximum in an incredibly short period to put together this programme in order to stimulate, promote and encourage more investment.

The Senator has mentioned the countries that have more fiscal space. As Ireland gets its country-specific recommendations, CSRs, in a number of areas, it is in this excessive deficit procedure because our deficit needs to come down. Those countries that have more space are encouraged through the CSRs to address the issue. That is the mechanism. It is a partnership approach which has been reinforced in the streamlining being introduced. With the involvement of more actors, it is important to have ownership. It is not a case of recommendations that this should be done by an outside body but of getting everybody to agree in discussions. There are bilateral meetings between the Commission and member states. The one with Ireland is taking place this afternoon. There is continuous engagement and a partnership between the Commission and member states to discuss the challenges at a country-specific level and see what needs to be done to address them.

In response to Deputy Bernard J. Durkan’s point about ownership, it is crucial and recognised in Brussels. Every effort is being made to increase it. I can only endorse and welcome what he has said. We are Europeans and these European issues and challenges concern us all. The CSRs for Ireland might involve a degree of homework or pointing to things that need to be addressed. The benefit of the process for Ireland in all of these recommendations being issued to all of the other countries is perhaps just as significant as, if not more so, the recommendations issued to other countries. Growth, investment, a reduction in employment, increased demand for our exports and so on in other European countries can have an enormous impact on Ireland’s growth prospects. Irish Ministers and officials discuss the economic challenges and issues in all countries, which is an important benefit of the process. I compliment the committee on its contributions to the Conference of Community and European Affairs Committees of Parliaments of the European Union, COSAC, and its efforts and engagement. It is remarkable that the policies and ideas it has developed are coming into, and being reflected in, European policies.

In terms of the need to activate investment, the approach taken here, in identifying the challenges in different countries, involves seeing where the problems and blockages are to encourage creating the mood and committees such as this one to discuss the investment programme across Europe. It is bringing investment back onto the agenda which will I hope encourage people because there is a lot of money that is not being used productively and there is enormous scope to do this.

I acknowledge what Deputy Seán Kyne said about the social and employment concerns that had rightly been flagged and prioritised during the Irish Presidency. It is welcome that they are reflected here. The CSRs are designed to address issues where there is room for progress and scope to do things. There is no point proposing ridiculous things that have no chance of being achieved, or things that are already being done. The challenge is to see where reform is needed and have collective consensus in prioritising several areas. It is not possible to list all aspects of Government policy.

It is a case of working in partnership with the governments to see what is the collective opinion of the Commission and then having it discussed with the other European partners as to where progress can be most useful and effective. I know the Commission has recognised and appreciated the co-operation with the Irish Government and the Irish authorities throughout the entire process and that is continuing.

On the question about investment in small and medium business, as the member said this has been one of the key challenges and issues. We know there are problems on both the supply and the demand sides and this has been discussed at length. Ireland has taken great steps with the public programmes and with the involvement of KfW. Funds are on the table and we hope now that as demand increases in the economy there will be more call for using these funds and that the issue becomes more one of demand - having enough SMEs demanding money - and that there is sufficient money available for them to expand and invest.

I take note of Deputy Byrne's points about the degree of compliance. Ireland is one of five countries that were fully compliant as regards the budgetary review process. A number of other countries are partially compliant so there is a different gradation of responsiveness, of degrees of compliance. We know there are problems in some areas that remain to be addressed. There is specific consideration analysis of the budgets for each particular member state. The process is ongoing for some of them - that is up to March of next year. Some countries will be reviewed at that time to see their degree of compliance.

Growth needs to be stimulated across Europe. I do not think Ireland is in a bubble situation. We know that the growth has been very strong this year. The projections set out in the Irish budget have been considered to be compliant. There is obviously a debate around the degree, the exact growth figure and so on, but the expectation is that growth continues on a sound, solid and sustainable basis for the next couple of years. One can never tell what is around the corner.