Mr. Seamus Coffey:

I thank the members for the questions. On the United Kingdom's position in the European Union, as mentioned by two Deputies, we must recognise that many of the difficulties created over the past couple of years may have arisen largely because of the United Kingdom's reluctance to become directly involved in solving the crisis. Therefore, there are intergovernmental agreements. Since all 28 member states, or 27 at the time, could not agree, there was approval by 25. Therefore, the treaty on stability, competition, governance and growth is essentially an intergovernmental agreement simply because the United Kingdom decided to opt out of it. That creates difficulties. There are certain elements that one now wants to formalise, as Professor Barrett mentioned, for inclusion in the treaties. The United Kingdom is seeking to have different elements changed. Therefore, there is conflict over putting what we have in place in a formal setting. The United Kingdom is seeking to change much of what is in place already. It is hard to see how an agreement could be reached. Both parties could come to the table, but both have somewhat different objectives. With regard to whether the European Union is viewed as being fair or unfair in the United Kingdom, I always find those in the United Kingdom speak out of both sides of their mouths given the rebate negotiated by Margaret Thatcher. It is not that the United Kingdom is doing poorly from the European Union in the financial sense. Its contribution could be much larger without the rebate being in place. There is little doubt it will remain. If it were to go, it would further strengthen the argument for leaving the European Union. There are difficulties. It is not so much a question of the negotiations Mr. David Cameron will have with the European Union that matter. What will matter is what he actually says to the UK people. It is up to him state whether he has gained something. That will be crucial in the referendum.

With regard to the National Competitiveness Council, there may be conflict with the Low Pay Commission. From an economic perspective, there may be a difference between the trading and non-trading economy. The trading economy involves exports and imports and dealing with other countries whereas a non-trading economy, by contrast, is largely domestic. In the main, a body such as the Low Pay Commission deals with the non-trading economy, the retail sector and domestic sector. The envisaged competitiveness council is looking more towards exports and how that sector can be driven. In the main, the exporting sector tends to be a high-paying sector, particularly in Ireland given the industries our exports come from. I would imagine that there would not be much conflict with bodies such as the Low Pay Commission. I believe there is scope for incorporation. One could become a sub-body of the other, but I believe they are examining different issues. I refer in particular to some of the countries that got into trouble during the crisis because of problems with their balances of payments. They have more money going out than coming in. In such cases, one must determine what is going wrong domestically in the economy such that exports are not being driven. That is not really a problem we have here. The two can interact and they are dealing with different problems.

Consider the objectives removed from the report, as referred to by Deputy Kyne. In the main, they were removed because of political objections, especially from what we call the creditor countries. They did not want to see them being permanent transfers such that there would be an increase in the income of other countries from giving them money, with the consequence that the German economy would be subsidising the poorer economies in the European Union. Alternatively, if countries were running into difficulties with their debt and financial markets would not lend to them, they could simply come to this aggregate EU body and continue to spend in a manner that the creditor countries might consider profligate and other countries might consider imprudent. In the main, the objectives are gone for political reasons. The crisis has stabilised to certain extent, so perhaps the objectives are not as necessary as they were. However, if one wants full European monetary integration, one has to get the monetary side right but there must equally be a fiscal role, which appears to have been pushed back. Again, one might say the national parliaments want sovereignty over what they do within their domestic economies but it means that if a country hits a crisis, one will not have unemployment benefit, for example, coming in from a European federal fund. If, for example, Florida goes through a crisis in the United States, there is an increase in payments to Florida from federal funds, and that can balance out what is happening.

Then another state hits a crisis and funds come in again. While there are merits to it, people want a view. In the US, the payment rates are the same across all the 50 states, whereas in Europe we must ask whether our unemployment benefits will be funded by money from France and Germany, and whether we should increase the rate given that the money is coming from elsewhere. There are legitimate concerns and it is very difficult to have equal rates across the 28 countries.

I do not see a major role for the European Fiscal Advisory Council. It can offer somebody to tell us the fiscal stance of the euro area as a whole. If 18 countries are changing their taxes and Government expenditures, what impact is it having on the currency bloc as a whole? Do we have a contractionary fiscal stance? Are we in a recession? Are we increasing taxes and cutting expenditure too much, or do we have an expansionary fiscal stance in aggregate? We have the individual fiscal boards in each country to ask whether countries are adhering individually to the fiscal rules. Maybe it would be appropriate to ask what we are doing collectively. It has no enforcement capacity, given that the fiscal rules do not apply at the aggregate level. Maybe they should, and we should be encouraging certain countries that have space to use it. While it is largely for window dressing, in future the idea of fiscal union could come back into the five presidents' report and maybe, by then, we will have six or seven presidents all contributing to the document. It could come back in as greater integration happens.

How can national parliaments get more involved? The two questions tie over in terms of economic and financial supervision and the clash between sovereignty and the increasing role of nationalism. National parliaments could get more involved in the drafting of documents that we submit as part of the European semester. By and large, reams of paper are produced at official level, and some of the recommendations are discussed here. The Parliament could discuss our priorities and identify our problems. The country-specific recommendations, by and large, are based on what is submitted at national level. Does our Parliament have sufficient input into what we submit? Do we just get the stability programme update and simply accept it, with country-specific recommendations coming from it and from the national reform programme? This could be revised not only in Ireland but throughout the EU. National parliaments could be more involved in the European semester. Now it is a case of hearing that the European semester is on and asking what the parliaments think. We could get them involved from the ground up. Driving it at national level would solve some of the nationalism issues. This is where most of it must come from. This is the national Parliament. It should determine what we do, not receive documents and be told what to do.