Oireachtas Joint and Select Committees
Thursday, 26 November 2015
Joint Oireachtas Committee on European Union Affairs
Work Programme 2016: European Commissioner for Agriculture and Rural Development
2:00 pm
Mr. Phil Hogan:
I thank everybody for their questions. On the Chairman's question on social rights vis-à-vis what was discussed yesterday with Jonathan Faull and the UK, my reply is also an answer for Deputy Byrne and others who raised the issue of the UK. The UK Prime Minister, David Cameron, made a commitment that he would hold a referendum and is entitled to put forward what he feels are the important issues he wishes to have considered. The European Union does not always have to agree with him and that is why a negotiation is taking place.
The free movement of people is a very important issue for the European Union and is one of its fundamental pillars. There will be a very intense negotiation on those matters, which, as we know, are quite dominant political issues in the UK. The free movement of people has been a considerable help to economies like the UK, Germany, France and other countries, in terms of the skills required for economic reasons. In the absence of having a definitive outcome of on any of the negotiations that are ongoing between the Commission and in the British Government, nobody who puts forward proposals expects to get everything for which he or she looks. The fundamental pillars of the European Union will be protected, in terms of issues raised by the Chairman and Deputy Byrne.
We recently put forward a new policy document on social rights. Commissioner Thyssen, who, I understand, was recently in Ireland, has given strong indications about the priorities of the Commission. The social dimension has now been put back into the narrative of the European Union, something that was absent for a number of years in terms of labour mobility, the rights of individuals in the workplace and the basic human rights of individuals as citizens of the European Union. We will see a stronger social dimension, in addition to the economic dimension that has been fostered by the current Commission, through Commissioner Thyssen.
Taxation issues were raised by a number of members. The European Commission has no proposals to force member states to change their corporate tax position. I remind members that it requires unanimity of member states before that can be done. I do not see any unanimity on this particular proposal in any part of the European Union at the moment, but reforms are needed in terms of the way in which we deal with the tax base, arising from recent high-profile decisions.
Ireland has been to the forefront in working with the OECD, through the BEPS project, to clarify and improve our tax situation at corporate level. We foresee a staging approach in order to get to the right place, which will involve openness and transparency in regard to the tax base, but that does not mean that we will ask the Irish Government or any subsequent government to change the 12.5% corporate tax base. This is about what does and does not count for calculable purposes for the tax rates to be applied. The OECD has worked with all member states, including Ireland, to provide clarity on that issue, and it is making substantial progress. This is why we are withdrawing the old proposal on corporate taxation, and not for any other reason. We want to work on the new opportunity the OECD work has given to us.
Deputy Durkan is correct when he says that the European economy is largely flat and needs a boost. That is why President Juncker developed his proposals on job growth and investment as one of the main priorities prior to the establishment of the Commission. One cannot do much without money. President Juncker has created a vehicle of €315 billion to try to put some kind of leverage in the financial system for every member state to be able to draw on for the more risky projects that would not otherwise go ahead.
In Ireland and Northern Ireland, or between Ireland and the United Kingdom, there are opportunities to consider joint projects, apart from member state projects, under the European Fund for Strategic Investments, EFSI, which is the fund implementing the Juncker investment plan. This is with regard to energy and major infrastructural projects on which we could work closely together, where normally we would not be on top of the list because of the scale of the projects or the risks involved. This country should reflect on what type of projects could be put forward over the next five or six years that could draw down this fund, which is not available elsewhere. The standard funds are available through the rural development programme or the Social Fund, but this is quite different. The Government is considering some projects along these lines to give impetus to major projects that may not otherwise go ahead. It is very important that we are conscious of our competitiveness and deepen the Single Market and the EU, because this is how we will have much more economic activity at the level of the 28 member states and have the necessary fiscal discipline, through the European Semester, to keep people in check and learn the lessons of the past from the many member states where things have gone wrong.
A number of people asked about the youth employment agenda. It is very important because in various member states, such as Spain, 25% of those unemployed are young people. This is huge in terms of social cohesion. We have a particular targeted fund for youth unemployment, and 650,000 places will be made available in the coming years, with €1 billion targeted at youth employment initiatives for training, apprenticeships and continuous education throughout the European Union, and Ireland is participating in this.
Climate change has been mentioned, particularly by Deputy Kyne in the context of agriculture. We subscribe to the role of agriculture in job creation and I gave a figure for 2013. I do not believe the figure of 61,000 from 2013 has abated and I would say there were more jobs created in 2014. It shows it is hugely important to mobilise the indigenous sectors of our economy for job creation purposes, because we do not need the same level of importation of raw materials. Agriculture and tourism have made a major contribution to our economic recovery.
It is crucial that the accounting rules integrate forestry and agriculture as part of the climate change negotiations. All land use should be taken into account irrespective of what is grown on the particular land. I hope this is what will emerge from the climate change talks in Paris, and we must watch carefully the bilateral negotiations that will take place between member states and the Commission on the effort-sharing decision to implement the outcome of the agricultural dimension of these talks. If the overall European objective is to grow more and feed the larger population of the world, which will be 9 billion people by 2050 - 2 billion more than we have now - how will we do this if we do not produce more? However, we must do it in an environmentally sustainable way and in a way that meets the horizontal climate change measures of other Directorates General, including that with responsibility for the environment. All of these matters must be taken into account before we come to the types of outcome we all desire, allowing food to be produced sustainably and meeting our climate change objectives. It is a difficult balance and the first half of 2016 will be an intensive period when the Government and Parliament will have discussions with European Commission.
TTIP has been mentioned by a number of people. I am involved in the TTIP negotiations from an agricultural point of view, but the lead negotiator is the Commissioner for Trade, Cecilia Malmström. We want a comprehensive agreement and not just an agreement on tariff equalisation or market access. I think the priority for the US side will be trade liberalisation based on the reduction of tariffs. We want to see progress made on financial services, public procurement, and the regulatory issues which have been mentioned, such as sanitary and phytosanitary issues, the environment, labour rights and standards across the board. We want to see them protected in the chapters of the negotiations. We depend on the parliaments of the 28 member states and the European Parliament to approve the deals, so the committee members will have a say on whether they agree or disagree with the outcome of the TTIP negotiations. I keep telling the US negotiators that we must have a deal we can sell at home to 28 member states and the European Parliament. It only takes one member state to say "No" and the entire deal is off. This is not fully understood or recognised. The member state parliaments will have a major say in the final outcome of the negotiations. Committee members can take it that the issues of concern to them are well marked, noted and communicated.
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