Dr. Anthony Coughlan:

Many issues were raised. I do not know whether I will be able to deal with all of them or remember them all. It is very important to realise we are faced with a drastic new situation and the committee does not need me to tell it this. The Conservative Party manifesto was published only two weeks ago. It repeated Mrs. Theresa May's statement last January that the United Kingdom of Great Britain and Northern Ireland will leave the Single Market and the customs union. It is a repetition of that commitment. It will be very hard for any British Government leader, whoever it is. Prime Minister May will probably be re-elected. Even if Mr. Corbyn were elected, he has committed to implementing Brexit as well, although possibly a softer variety.

The reality in political terms is the United Kingdom will leave, which means part of our country will leave. If we stay in the European Union it seems to be fairly obvious that new dimensions will be added to partition. We will have to accept more and more EU laws, while in the North of Ireland the laws will continue to be made by the United Kingdom. Almost certainly if the United Kingdom leaves the customs union we will have some form of custom controls on the Border. This will add to partition compared to the position we have today.

I made the point that the statement by the British, that they have no security interest in staying in the North of Ireland, will change once we stay in the European Union. It will become closer together in security terms, and they are speaking about this. We are, to some extent, going along with this, whatever about what happens to neutrality. The British will not look kindly on the southern State going with the European Union. It would give it a new reason to hold onto the North of Ireland. Otherwise, if it allowed or encouraged or, down the road, it came about the North and South came together and there was some possibility of reunification, the whole of Ireland would then be in the European Union with much closer security co-operation under German hegemony, which is fairly obvious. This is hardly likely to be in Britain's security interests, or even in England's security interests assuming the United Kingdom did not hold together, but I believe it will for the foreseeable future. That is not the current situation. In that sense, we do add a new dimension. We will give the British a new reason for holding onto the North.

Then, of course, we will give the unionists a whole lot of other new reasons for staying in the union, because for them to leave the union they would have to join the EU, take on board more than 120,000 legal acts, which result from the EU, and adopt the euro currency. This is a major obstacle in the way of any unionist perception, or the perception of some unionists, that they might look favourably on a united Ireland. These are new dimensions to partition. Surely they make eventual Irish unification more difficult. It seems to me these are irrefutable statements, which are very hard to question.

It is not a question of us rejoining the United Kingdom. If we leave the European Union, we would be the second state to leave from the 28 members, and I believe other states will almost certainly leave down the road, or certainly leave the eurozone. The euro is a dysfunctional currency which will not hold together, certainly not for its current 19 members. That it is a dysfunctional currency is admitted by those running it. It will have new problems. Leaving it is not a painless operation I accept, but staying in it is also likely to be to redolent with pain and problems. There have been many examples of currency unions that have broken up. The USSR broke up into the 15 states that inherited the USSR. One state became 15 and one currency in the USSR, the ruble, was replaced by 15 currencies in the 15 successor states. Senator Mark Daly raised this point. Czechoslovakia broke into two, and we had the Czech crown and the Slovak crown. Yugoslavia broke into seven or eight states, which each has its own currency. States leaving currency unions and adopting currencies of their own are relatively common. I understand that if we take into account the former colonial powers, something like 60 currency unions broke up during the 20th century, including those I have just mentioned.

If we left the European Union we would need to co-ordinate and we would have to have our own negotiations with the European Union and the United Kingdom.

Two agreements would be needed, one with the United Kingdom and one with the European Union, which we would be leaving in parallel with the UK. That does not mean that we would become part of the British state or do whatever the British want.

We should keep our own currency. To give it up would be lunacy. The value of having our own currency was evident during the Celtic tiger period of 1993 to 2000 when we had, for the first time in the history of the Irish State, an effectively floating exchange rate which gave us a highly competitive exchange rate and an 8% economic growth rate each year. In 1993 and 1994, the Irish pound was one tenth more valuable than sterling. It was then devalued and decreased in value to 90 pence sterling in the next eight years. That measure, more than anything else, led to the Celtic tiger. If the UK leaves the EU, as it will, it is likely to devalue sterling, which will hugely hit our exports to the UK if we stick with the euro. Commentary on this matter usually exaggerates the importance of the EU 26 market. The basic statistics are compiled by the CSO and reproduced on page 3 of appendix 1 to the handout given to the committee. They show that three fifths of our exports go to, and two thirds of our imports come from, outside the EU 26. If one adds together our exports to the United States, Canada and the United Kingdom, it is as much as our exports to the EU 26. Our exports to English-speaking countries are more valuable than those to the EU 26. It is not as if one has to choose between one market and another. If we leave the EU along with Britain and our fellow countrymen in Northern Ireland, as we should, a sensible agreement between the United Kingdom, the European Union and Ireland would ensure free trade, which we already have. There is no reason that should not continue if sense rules in the negotiations that will develop over the coming two years.

It is true that we have received a significant amount of money from the European Union over the past 40 years. The general official and unofficial view in Ireland was that the EU was a cash cow, particularly for Irish farmers because the Common Agricultural Policy gave substantial sums of money to Irish food producers. Over the past two years, we have become net payers into the EU. The second annexed paper gives the figures in that regard. In 2014, we became a net payer for the first time, paying €1.69 billion into the EU budget and receiving €1.52 billion. That has continued since and is likely to continue for the foreseeable future.

Senator Lawless asked what will replace CAP payments if we leave the EU. The Exchequer can replace the CAP payments because all the money that we get from the EU in the future, whether it be CAP payments, regional funds, Erasmus programmes or research supports, will, in effect, be Irish taxpayers' money coming back. It is currently a net payment of a few hundred million but that is likely to grow, depending on our economic growth rate or otherwise. That has been the case with the United Kingdom. It makes contributions to the EU of in the region of €10 billion per year. During the Brexit referendum, there was talk of spending the savings on the National Health Service, but it will eventually be able to spend the €10 billion when it leaves the European Union. It will probably have to continue to contribute for some period as there will be some kind of interim settlement, but they will eventually get that money back. There is no longer any money for us from the EU. One might say tat we got many benefits in the past and farmers certainly got many benefits. Is it a situation of eaten bread soon being forgotten? It is a new situation. We must be realistic and consider what are our interests. One could argue that even though we got a significant amount of money from the EU, or farmers and various other interests groups who received regional funds and INTERREG funds and so on did, we gave the EU extremely valuable fishing rights. The value of catches by foreign boats in Irish fishing waters is greater than the net monetary benefit we have received from the EU since joining. We would get these rights back if we left the EU. The United Kingdom will recover the rights to its waters. If Northern Ireland leaves with the United Kingdom, as it will, will it have control of sea fishing rights there and what will happen in regard to the South of Ireland? The EU has not just been benevolent to us. We gave them our fisheries. We must be realistic that in future Ireland will be paying in more than it gets out. What is our interest in doing that? What benefits will we receive from the EU if we stay in? It is very hard to say. I cannot see what they are. We are not going to get more money. There will be new dimensions to the Border between North and South. We would have the advantage, were we to leave at around the same time as the British, of getting our fishing rights back and the possibility of getting our currency back.

In terms of the single currency, it was huge folly for us to join the EU. We are in deeper than the British because we have the euro while Britain was sensible enough to avoid it. We are now caught in the eurozone trap. Getting out would require the co-operation of the EU authorities, the eurozone authorities, Germany, the principal country in the eurozone, and the Bank of England in regard to sustaining a devaluation in that context. There are very good advantages in getting back a national currency. Without it, we are stuck with the euro, which is likely to get more valuable in regard to sterling and that will hit our exports and encourage competing imports during the coming period. It was utterly foolish for us to join. We experienced the delights of the eurozone when Mr. Trichet, then president of the European Central Bank, said that no Irish bank must be allowed to go bust and forbade the bondholders being burned in regard to Anglo Irish Bank or the Bank of Ireland and so on. That was the result of European Central Bank policy and we have suffered very much from it in recent years. To restore the national currency is fundamental. The two pillars of the nation state are the sword and the currency, as Romano Prodi, former president of the European Commission, said. The sword is a monopoly of legal force in an army and a police force, while the currency can enable a state to have control over either its rate of interest or exchange rate. We gave up that fundamental pillar of the nation state by joining the euro on the assumption the British were going to do so in a year or two and we have suffered the consequences. One of the big advantages of leaving the EU would be that we would get our own currency back. There would be costs and problems if we were to do so but there will be problems if we stay.

One problem that has not been mentioned is that by staying in the EU without the United Kingdom we will find it much less easy to sustain things like our corporation tax rate or our national interest in regard to fishing rights and other areas where British and Irish positions have been rather similar. Members are aware of the pressure exerted by the EU in terms of subverting or eroding our corporation tax rate which is so important for attracting foreign industry. In this regard, the United Kingdom has been on the same side as this State. Trying to resist those pressures without the United Kingdom alongside us will be much more difficult and cause us many problems. That is another relevant factor.

The Chairman asked a question regarding positive aspects of the EU.