Oireachtas Joint and Select Committees

Thursday, 6 April 2017

Joint Oireachtas Committee on Foreign Affairs and Trade, and Defence

Potential Impact of UK Withdrawal from the European Union: Discussion

9:30 am

Ms Raphaƫlle Faure:

I want to make some points on the financial effects and the effects on the ground of a cut EU aid budget. There is a risk that the EU is going to cut budgets in every sector, salami slicing so that everyone will see less money. Perhaps there is an opportunity for member states to push for a better focus, so that in areas where the EU is not so good they stop funding and find someone else to take over so that it can focus on areas where it has a comparative advantage. That might be a way of avoiding the salami slicing.

I was in Brussels a few weeks ago and heard that the external action envelope for the next seven year budget is likely to increase because of the worries around migration. Despite a cut from the UK leaving there might still be more money available for that. Whether the money goes to the right causes is another question, but the budget on external action and therefore aid might be greater than it has been during the current multi-annual framework.

Will more EU aid go towards bad deals, like deals around migrations and compacts with dodgy countries? I am not sure that the UK leaving will change that very much. The UK was not that big a player in the migration talks - other member states lead on that. I am not sure that we will see a big difference with the UK leaving. The UK will still be able to contribute to things like trust funds, for example the trust fund to tackle root causes of migration. A contributor is part of the board, and members of the board are entitled to decide where the money goes and how decisions are made. There is potential for the UK to retain a voice in those frameworks.

The European development fund is a good fund to contribute to. It is a fund that countries contribute to voluntarily, and can chose to increase or decrease how much they provide to it. It has had excellent feedback this year from the Department for International Development, DFID, in the form of the multi-lateral aid review. The European development fund got one of the best scores, so in the DFID's view it is one of the best ways to channel money. It also goes under the scrutiny of the accountability mechanisms of the EU, like other development funds. Funding is looked at closely.

In terms of ensuring minimal impact on the ground because of the UK leaving, the UK leaving the EU does not mean that it will stop spending money in those countries. There needs to be good collaboration and good co-ordination to divide labour and to make sure that we do not start duplicating efforts, and to make sure that the UK retains a place where it is currently doing good work. It will be a question of continuing dialogue, especially on the ground, and trying to make sure that not too much changes for the developing countries as a result.

Discussions are ongoing regarding transition funding. The UK is committed to spending on programmes that will go beyond 2019. In theory it should continue funding those because it has an obligation. When one hears the talks about the divorce bill and the different views in circulation one wonders whether the UK is going to pay, but in theory it has a commitment to doing that, and it should.

In terms of alliances with countries like Italy or Spain and whether that might mean more focus on Latin America, Spain is already quite influential in getting money to Latin American countries, especially from the European Parliament. That is likely to continue to progress.

Ireland is part of a like-minded group of donors which was lead by the UK in the EU until now, but there is no reason why this group should stop existing and stop carrying the progressive message it has carried until now. There is potential for Ireland and the other donors, such as Denmark and the Netherlands, to continue pushing those ideas forward in the EU.

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