Oireachtas Joint and Select Committees
Tuesday, 13 November 2012
Joint Oireachtas Committee on European Union Affairs
Forthcoming General Affairs Council: Discussion
I remind members of the joint committee, guests and those in the Visitors' Gallery to please switch off their mobile phones. It is not good enough to leave them in silent mode.
The first item on the agenda is a discussion on the forthcoming General Affairs Council meeting with the Tánaiste and Minister for Foreign Affairs and Trade, Deputy Eamon Gilmore, whom I welcome on behalf of the committee. He will also attend the meeting next week. We are delighted to welcome him again to the committee. We understand he has a busy agenda for the meeting next week and look forward to being briefed on it.
Thank you, Chairman. I am pleased to have the opportunity to brief the Joint Committee on European Union Affairs ahead of this month's meeting of the General Affairs Council which will take place in Brussels on Tuesday, 20 November. The General Affairs Council will meet for a morning session, at which I will represent Ireland and be joined by the Minister of State, Deputy Lucinda Creighton. Agenda items include: the cohesion policy legislative package; presentation of the European Commission's work programme for 2013; follow-up on the European Council of 18-19 October; preparations for the special European Council of 22-23 November; and preparations for the European Council on 13-14 December.
An informal working dinner for General Affairs Council Ministers will be held on 19 November. President Van Rompuy will attend the working dinner when discussion will focus on the multiannual financial framework, MFF, and preparations for the European Council on 22-23 November.
As I look ahead to next week's Council meeting, it might be helpful also to update the committee on the last General Affairs Council discussions, which took place in Luxembourg on 16 October.
The Cyprus Presidency has substantially progressed work on the cohesion legislative package. The GAC has by now agreed a partial general approach on seven thematic blocks of the cohesion legislative package, including on elements of the European territorial co-operation regulation and country-specific recommendations. The EU's cohesion policy remains a clear demonstration of the solidarity between member states, enabling change and encouraging development in the regions. It is perhaps worth reflecting here that our experience of cohesion policy has been overwhelmingly positive.
The General Affairs Council next week will discuss some further elements of the cohesion policy legislative package and details of these elements will be confirmed by the Presidency shortly in advance of the GAC meeting. This legislative package aims to reinforce the strategic dimension of cohesion policy and to ensure that EU investment is targeted at Europe's long-term goals for growth and jobs. These partial general approaches do not prejudge the outcome of negotiations on other elements of cohesion policy or on the multiannual financial framework.
Next week's Council meeting will also include a briefing by the Commission on its work programme for 2013, which it adopted on 23 October. Each year the European Commission publishes an annual work programme outlining how the European Commission President's political guidelines for 2009 to 2014 will be implemented in the coming year. The Commission work programme 2013 contains a comprehensive outline of the Commission's priorities for 2013. The programme is divided into seven key areas of work: towards a genuine economic and monetary union; boosting competitiveness through the Single Market and industrial policy; connect to compete - building tomorrow's networks today; growth for jobs - inclusion and excellence; using Europe's resources to compete better; building a safe and secure Europe; and pulling our weight - Europe as a global leader.
In its work programme, the Commission puts particular priority on the implementation of existing legislation as well as on measures that contribute to tackling the current economic crisis. The focus is on strengthening effective economic governance and on increasing Europe's competitiveness, including making better use of the untapped potential of the Single Market. This focus ties in well with Irish Presidency priorities, and as such, serves Irish national interests favourably. The work programme contains proposals that will directly contribute to fulfilling the political goals agreed upon in the compact for growth and jobs. I am also pleased to note that the work programme anticipates progress on a range of trade agreements with third countries, including the United States and Japan, both of which are of particular interest to Ireland.
During the October meeting of the GAC in Luxembourg, President Van Rompuy joined Ministers via video link for a lunchtime discussion of preparations for the October European Council. At last month's European Council meeting in Brussels, leaders had a number of substantive issues on their agenda, including reflection on the possible future shape of Economic and Monetary Union, which underpins our shared currency, as well as taking stock of implementation of the compact for growth and jobs. Beyond those economic issues, Heads of State or Government also had a good exchange on our relationship with the Union's strategic partners, most notably with China, and they adopted a comprehensive set of conclusions on the developing position in Syria, Iran and in Mali.
The central focus of deliberations among leaders was on the means of strengthening economic and monetary union and most particularly on progressing towards so-called banking union. The framework for these discussions was provided by President Van Rompuy's interim report, Towards a Genuine Economic and Monetary Union. It was agreed that President Van Rompuy will continue his consultations with member states and others before bringing forward his final report to the December European Council, which will set out a specific and time-bound map for strengthening economic and monetary union. Importantly, leaders reaffirmed their commitment from June to break the vicious circle between banking and sovereign debt. Heads of State or Government also clearly reaffirmed the commitment to provide for the possibility of recapitalisation of euro area banks by the European Stability Mechanism.
With the single supervisory mechanism, a critical step in the creation of a banking union, leaders have now agreed a clear timeframe for its entry into operation as a matter of priority, with its legislative framework concluded by the end of this year. Work on the operational implementation of the single supervisor is to happen during the course of 2013, and this concrete timeframe is most welcome.
The European Council tasked the group of finance Ministers, including our Minister for Finance, Deputy Noonan, with drawing up the exact operational criteria that will guide direct bank recapitalisation by the ESM in full respect of the June decisions. This too is a positive outcome. Leaders also adopted conclusions on the implementation of various aspects of the compact for Growth and Jobs. Progress has been made in beginning to implement the various elements of the compact but it is evident that more needs to be done, and implementation is key. Taking forward the various aspects of the compact at EU level, whether concerning, for example, the Single Market, youth unemployment or expanding opportunities for external trade, will form an important aspect of the our work in the Presidency next year.
The European Council meeting on 22 and 23 November is expected to be focused almost exclusively upon the multiannual financial framework for the period 2014 - 2020. President Van Rompuy is aiming to conclude negotiations of the EU budget multiannual financial framework at this meeting. The MFF will be discussed informally at a dinner with President Van Rompuy, ahead of the General Affairs Council on the night of 19 November and again during the meeting of the General Affairs Council itself. The Cyprus Presidency has been leading on negotiations up to now. It recently put forward a new version of the MFF negotiating box, which for the first time contained proposed figures for different elements of the MFF. Among other elements, the Cyprus Presidency proposed significant cuts to agricultural and cohesion spending. However, its compromise proposals have not gained the support of member states. This happened because in some cases the amounts proposed were felt to be too large and in other cases, including ourselves, because it was felt the amounts were too small.
Negotiations will from now be led by President Van Rompuy and his team as we approach the meeting of the European Council after next week's GAC. President Van Rompuy will shortly table a draft compromise proposal which will form the basis of discussion at the General Affairs Council. It is expected that this proposal would seek significant cuts to the original Commission proposal, and in all probability cuts greater than those proposed by the Cyprus Presidency. This would be welcomed by some member states but opposed by others, including ourselves. In addition to the proposed global amount of cuts, there would also be a question of how those cuts would be distributed among the different headings of the MFF. There is no doubt that reaching agreement on the MFF this month will be a difficult task as member state positions are far apart. Some have quite hard-line positions, especially those who want the overall size of the budget reduced. Some have called for very significant cuts to the Common Agricultural Policy, CAP, and some want increased spending on cohesion. The gaps will be hard to bridge but I am convinced that with the right political will we can get there.
How will we approach the European Council meeting next week? As the members of the joint committee are aware, Ireland wants a properly funded and properly functioning European Union, with the right mix of priorities, fair allocation of resources and a focus on jobs and growth. The EU must have a budget that is fit for purpose. We are committed to supporting a vigorous, consumer-focused agricultural production base in Europe, with a commensurate CAP budget. The EU budget must also support the Europe 2020 strategy for jobs and growth while at the same time reflecting current budgetary consolidation imperatives in Member States. We will seek to ensure that adequate funding is available for investment in economic growth and the creation of employment and that countries in our position, especially regarding unemployment, can access all EU growth-enhancing programmes. These are our aims but we must be realistic; a deal will require compromise by all member states, including ourselves. Nevertheless, we will try hard to get the best deal possible.
Next week's Council meeting will also take the first step in preparing for the European Council scheduled for 13 and 14 December by considering the annotated draft agenda for the meeting. The annotated draft agenda was circulated last evening and sets out the key matters for consideration by leaders. The December summit is expected to centre around deliberation on President Van Rompuy's final report on strengthening economic and monetary union. This report, prepared in close collaboration with the Presidents of the Commission, the Eurogroup and the ECB should set out the specific and time-bound roadmap for moving ahead on the essential building blocks for a genuine economic and monetary union.
We will continue to engage with President Van Rompuy's team as they continue work on the final report, which I look forward to reading. It will, I am sure, seek to guarantee a strong and stable currency, something which is clearly in our own national interest as well in the interests of the euro area and indeed the European Union as a whole.
The December European Council will also assess progress made concerning the single supervisory mechanism for euro area banks as well as on other banking-related legislative proposals. It will provide further orientations if necessary.
Leaders will also take stock of progress made under the compact for growth and jobs and under the various Single Market initiatives. This close and ongoing follow-up at the level of Heads of State or Government on these critical issues for the Union is something that I warmly welcome and encourage. The European Council will further provide guidance concerning the issue of EU enlargement. This consideration will be undertaken on the basis of the Commission's autumn assessment. Foreign policy issues will also be addressed by leaders as necessary and where they can add value. I appreciate the attention of the committee and I look forward to hearing its comments. Within the time available to us, I will be happy to respond to points or queries raised.
The Tánaiste must leave here by 4.35 p.m. We should have enough time for questions and each member will have three minutes. I thank him for his comprehensive overview. I have a couple of questions on the multi-annual financial framework. I would like an update on the deliberations that have taken place on two areas, the funding for the youth guarantee scheme and the development aid programme. I know that budgets are under pressure. Can he give me an update, and tell me what is being said about the European wide development aid programme? I call the second questioner, Senator Leyden.
I welcome the Tánaiste, his staff, diplomats from other countries and the media. I thank him for the comprehensive report. I shall not start second-guessing him because he has a busy schedule of meetings. I wish him continued success in that regard, particularly taking over the Presidency of the EU in January 2013. I also congratulate him on Ireland gaining a seat on the United Nations Human Rights Council next year, for a three-year period. It consists of 47 countries. I congratulate him, his diplomats, Bono and others who contributed to securing the seat. The seat recognises Ireland's position on human rights and we will continue to work on human rights. It gives Ireland an additional role and continues the work done by the former President, Mary Robinson, and others.
The Tánaiste welcomed the announcement by stating that Ireland's reputation had been restored. I do not think that it had to be restored as far as human rights are concerned. I remind him that Ireland won a seat on the UN Security Council in 2001. It was a great success, and there were no diplomats then, so Ireland's recent success is not unique.
I take exception to the attack made on Trócaire by the chairman of the Fine Gael Party, Deputy Charlie Flanagan. It is unfair because Trócaire does excellent work throughout the world, particularly in the Middle East.
On 1 January the Tánaiste will take up a seat on the human rights council and human rights are being abused in the Middle East. I hope that he will take the opportunity, when he attends the council's meeting and takes up the new position, to highlight the conflict. Israeli missiles have been fired into Gaza and Syria and the conflict is heating up again. The matter should also be on the agenda of the General Affairs Council meeting next week.
I join with Senator Leyden in congratulating the Tánaiste on securing the seat. I want to refer to the budget for the multi-annual framework. Obviously the negotiating box by the Cypriot Presidency last week did not garner enough support. I have already raised the issue of macro-economic conditionality of Structural Funds with the Tánaiste or the Minister of State at the Department of Foreign Affairs, Deputy Creighton. I am disappointed that the matter is still being discussed. It is a dangerous concept. It is unfair that good social projects in, for example, disadvantaged areas along the Border or in a Border county, could see funding or workers' pay suspended due to the wider economic problems here. I know that the EU Parliament and the Government oppose conditionality. How does the Government propose to work with others to remove conditionality?
There seems to have been little progress made on our own resources and there has not been agreement so far. The Commission, with the support of enough countries, seems intent to push ahead with the financial transaction tax. Does the Tánaiste foresee a situation where the contribution of one state is calculated using one method, such as the financial transaction tax, while another country, like Ireland, outside of the financial transaction tax, will have its contribution based on the current VAT model? What is the preferred method of own resources or contribution calculation for Ireland?
I probably sound like a broken record because I have talked so much about youth unemployment and the Irish Presidency at meetings of the committee. What about funding, part funding or a youth guarantee? The Minister for Social Protection has said that she will advance the matter during the Irish Presidency. Where does the Tánaiste think funding will be found? Figures sourced from the International Labour Organization show that the amount of Ireland's entire ESF money would need to be used to deal with youth employment. Other member states have linked the issue to a financial transaction tax that Ireland would not be part of. Does the Tánaiste see a youth guarantee working on an EU scale? Where will the funding be found? Has thought been given to creating a specific funding instrument? In broader terms, beyond following the Commission's plan in December, will the Government prioritise the fight against youth unemployment during its Presidency?
I thank Senators Leyden and Reilly for their congratulations on Ireland's election to the UN Human Rights Council. It demonstrates the high regard in which Ireland is held by the international community. I pay tribute to my colleagues in government, and to members of the committee and the Oireachtas Joint Committee on Foreign Affairs and Trade, who promoted our case, to become members of the human rights council, through their various contacts with other states. I also pay tribute to the staff of my Department, the diplomatic or embassy network and Ambassador Anderson, our representative at the UN in New York. They all did an outstanding job in securing our election to the human rights council.
There have been a number of questions on the multi-annual financial framework and the level of discussions. We have the negotiating box from the Cyprus Presidency. We have, along with many other member states, expressed our opposition to the negotiating box. It falls short of the Commission's proposals that we had supported. We expect that President Van Rompuy will present a new set of proposals in advance of the GAC meeting next week, on 22 and 23 November.
As I said in my introductory remarks, it will be difficult to reach agreement. There are large gaps in views between member states. Some states have expressed a clear determination to drive down the size of the budget while other states, like ourselves, have argued that we need to have a European budget that is fit for purpose. In particular, we need a European budget that delivers on the objectives that the European Union has, particularly the implementation of the compact on jobs and growth. Clearly included in that matter is youth employment which is high in this country and in other European Union countries. The current level of youth unemployment is simply unsustainable for the European Union. We need a European Union budget that is capable of addressing the problem. A youth guarantee is one measure that we intend to pursue during the course of our Presidency. The Minister for Social Protection has set out her objective to pursue it through the Employment, Social Policy, Health and Consumer Affairs Council, EPSCO, and she shall seek agreement on a youth guarantee during the course of our Presidency.
While funding for the youth guarantee is not a matter for the budget discussions on 22 and 23 November, we need to ensure there is a budget to cater for it. Regarding the specific point on development aid provision in the budget raised by the Chairman, we are anxious that there is a final package for heading 4, to reflect our development co-operation policy objectives and interests and reflecting the values of our development co-operation programme. We support funding for initiatives that support food security and sustainable agriculture, the environment and gender equality. In the reductions proposed in heading 4, we do not support an across-the-board cut. The three largest instruments, the development co-operation instrument, the European neighbourhood instrument and the instrument for pre-accession, should be reduced by an equal portion if they are to be reduced. Smaller instruments, which are strategic in nature, should be exempted from cuts as any reduction would be more keenly felt than for the main ones.
Given the EU's position as the largest humanitarian aid donor, it is important that the instrument for humanitarian aid be protected from cuts. Regarding the issue raised by Senator Leyden, I value the work of Trócaire over many years in promoting development aid and in its direct work on its projects and the volunteers who work with Trócaire in many countries. My Department works closely with Trócaire, as it does with other NGOs.
Regarding macroeconomic conditionality, as raised by Senator Reilly, the need in principle to improve economic and fiscal discipline is accepted. We suggest the approach should be rational, appropriate and balanced, with safeguards against unforeseen circumstances. The modalities under which macroeconomic conditionality is applied to the cohesion and structural funds require careful attention.
In paragraph 71 of the negotiating box, we note that suspensions should be proportionate and effective to take account of the circumstances of the member states concerned. That is in accordance with Ireland's position. Where there is an understanding of the need to maintain fiscal and macroeconomic discipline, we have reservations about the modalities for implementation in respect of cohesion and structural funds. We want the approach to be rational, appropriate and balanced, with safeguards against unforeseen circumstances. We need to ensure the application of conditionality does not undermine the key aim of promoting growth, which is the best way of reducing fiscal deficits.
With regard to own resources, Ireland's position remains that is while we believe a system based on gross national income, GNI, is the fairest, simplest and most transparent and provides stability, we are willing to constructively examine all options. As already signalled, we will not be participating in the financial transactions tax, FTT. As stated in the Presidency paper, more information must be provided by the Commission for serious evaluation of the different proposals. I think I have covered most of the questions raised.
I thank the Tánaiste for attending the meeting. Picking up on some of the themes raised in his address, the Tánaiste touched on discussions taking place on the future shape of the European monetary and banking union. I ask the Tánaiste to comment on the current situation of Greece, and reaffirm that it is in Ireland's and Europe's interests to ensure Greece continues to be a member of the eurozone and that it is facilitated in dealing with its major difficulties. Some of the discussion that took place a year ago, regarding the idea of Greece leaving the eurozone, was misguided and dangerous. It is essential we find a way of facilitating Greece and allowing it to work through its difficulties while continuing to be a member of the eurozone. That should be made clear.
My second question concerns the situation in the United Kingdom, which the Tánaiste touched upon in terms of the discussions taking place on the multi-annual financial framework, MFF. There is an increasingly strong stance coming from some members of the British political system with regard to a referendum on Britain's membership of the European Union and its participation or non-participation in a banking union. We have been successful at riding two horses at the same time, maintaining a close relationship with Britain and deepening political integration with the European Union. The strong statements coming out of the British system are challenging continued deep participation in the European Union. I would appreciate the Tánaiste's views on where that stands and the choices it may present to Ireland in the future. In support of a point made by the Tánaiste with regard to the MFF and the sub-heading of global hunger, having seen the way the money is spent when I visited Malawi, it is of great importance that Ireland supports the value of the sub-heading and ensures the European Union's role in maintaining an increase in nutrition and in fighting global hunger is not affected as a result of these negotiations.
I join the previous speakers in thanking the Tánaiste for attending the meeting. I warmly congratulate the Tánaiste on his success in getting a place for Ireland on the United Nations Human Rights Council. It is a great achievement and represents another chapter in the enhancement of Ireland's international role. It is great for the country.
I am happy to hear the Tánaiste reiterate the Irish position that jobs will be central to our Presidency and that job creation is central to our agenda in the next General Affairs Council meeting. It merits repeating that youth unemployment is the greatest crisis of our time. It is in the region of 30% here and as high as 50% in other countries. It is unacceptable that this continues. Is the Tánaiste optimistic that we will get the kind of funding and direct initiatives, on a Europe-wide basis and specifically here, to enhance our ability to deal with youth unemployment? It is dealt with on two levels, at the level of reskilling and retraining and at the level of job creation. The latter is slightly difficult, as it must come from a number of fronts, including the private sector. There must be a direct involvement in creating jobs. Does the Tánaiste think we will get product? Over the course of the Presidency, will there be an initiative of some substance in that area? We are all with the Tánaiste in identifying it as the greatest priority for our country and our Presidency going into the General Affairs Council meeting.
I am happy to know that work has been agreed and is continuing on effective governance in the financial sector.
Ultimately, that might have a satisfactory spin-off for this country and assist the work of the Minister for Finance.
The Tánaiste made interesting and relevant points on the multi-annual financial framework, MFF, which is of significant concern. We support the position he has taken on maintaining the absolute amount. He does not need to be reminded that the Common Agricultural Policy is critical in achieving the 2020 objectives, our employment goals and the regeneration of the economy. As he said, there are member states which want to reduce the absolute amount devoted to the Common Agricultural Policy. Does he think he has built a sufficient set of alliances among like-minded states to hold the position, or as close an amount to it as possible? Having held the overall amount under the Common Agricultural Policy, does he think he will be able to hold the power of discretion for the Government on the spending of our share of the fund? We know best how to apply it to meet the requirements of domestic agriculture rather than have something prescriptive that might not fit in an Irish context. Let me reaffirm that we are very happy with the priorities identified.
I welcome the Tánaiste and reiterate the congratulations expressed by others. I had three questions but two of them have been touched on. I reiterate Deputy Paschal Donohoe's concerns regarding the budget being used by certain member states to whip up an anti-EU feeling. Deputy Joe O'Reilly commented on the CAP budget, but the Tánaiste has stated some member states have called for significant cuts to agricultural and cohesion funding. I wonder whether they recognise the role the Common Agricultural Policy plays in guaranteeing food security, protecting rural communities and preventing Europe moving towards a system of factory farming, which would be more likely to happen in the absence of a strong Common Agricultural Policy.
On the Social and Cohesion Funds, the trend in recent years has been to support initiatives in regions as opposed to individual member states. Obviously, there is a cross-Border role, but is the Tánaiste concerned about what that trend would mean for us in the future, including the west and Galway, in particular?
I will comment on the point made by Deputy Paschal Donohoe on Greece. Difficult discussions are under way aimed at helping Greece to return to the path of sustainability. It is fair to say one year ago there was much public and political discussion about whether Greece would leave the eurozone. That is not on the agenda and is not being raised as a serious prospect. It is important to recognise that progress has been made and that it is clear that Greece intends to stay in the eurozone and that the European Union as a whole and the eurozone wants Greece to stay in it. It will work with Greece to ensure that happens. It is also interesting to note the discussion which has taken place in the past couple of days on whether it will take eight or ten years for Greece to work through its difficulties. Not so very long ago there were voices in this House stating we should do what Greece was doing. We now see the wisdom of not having doing so. We are looking at a situation where it could be eight to ten years for Greece to work through its difficulties. We are talking about exiting our programme next year. The most recent discussions with the troika were in that space. It is very important that there is solidarity with Greece. The European Union is about solidarity and members states showing their support for others. That will be part of the discussion. I am glad, therefore, that the speculation about Greece exiting the currency has come to an end, as that will probably help to ensure stability.
Ireland and Britain, our nearest neighbour, joined what was then the EEC at the same time. Britain has always been a very important partner for Ireland in the European Union. We have very often found ourselves on the same side of discussions and arguments. As a consequence, we have a very special relationship. There is a certain degree of debate in Britain about its future in the European Union. It is very much in our interests that it remain a fully engaged member of the Union. In bilateral discussions we have with it, we express the hope it will continue as a member. The European Union is very important for the United Kingdom and the United Kingdom is a very important member of the European Union.
We are anxious to ensure the provisions in respect of hunger will be maintained. We have our own development body. Development aid policy is very much focused on hunger and nutrition. We were a leader in what has become known as the SUN - Scaling Up of Nutrition - movement. We want to see these funds maintained in the budget.
On the issue raised by Deputy Joe Reilly on youth unemployment, the sequence is that we expect there will be a package of measures which we hope will include proposals in respect of the youth guarantee and youth training to come from the European Commission in December. The discussion on the funding of these proposals will follow and we will continue to press for an adequate weighting in the Cohesion Fund allocations for unemployment, particulary youth unemployment, measures.
On the Common Agricultural Policy, we are very conscious that 85% of the funding allocated to Ireland through the European Union comes through the Common Agricultural Policy. Clearly, it is a major financial priority for us to ensure we secure the right outcome. We are working closely with other member states with an interest in the Common Agricultural Policy to ensure we secure the best outcome in the negotiations, including maximising the flexibility under Pillar 1 in respect of direct payments. Deputy Seán Kyne, who mentioned the importance of the Common Agricultural Policy in respect of food security and rural communities, would strongly agree with this. Since we have placed a very strong emphasis on the European Union budget, its objective to address job creation and growth, the food sector is of significant importance in that context. As we have seen in the past couple of years, growth in food and agricultural production in terms of its potential for economic development and job creation is of major importance. It is not a case of either-or.
I asked about the regions.
I apologise. We will work to ensure there is maximum Irish access to cohesion funding at regional level. It is not just a national policy. We are keenly aware in the negotiations of the need to maximise our access to those funds. We will watch the statistics relating to the relative prosperity of the regions carefully. More developed regions need to continue to be able to access cohesion funding, particularly to tackle issues like unemployment and disadvantage. Obviously, that is part of the discussions that are taking place at two levels, the first of which relates to the budget itself. The second tier of the discussions that are under way relates to the distribution of the budget that will be agreed.
The Tánaiste is very welcome. It is great that he is here in advance of next week's meeting of the General Affairs Council. I will begin by speaking about youth unemployment. We learned today that this country has a youth unemployment rate of 34%. The Tánaiste mentioned that the equivalent figures for Greece and Spain are approaching 50%. The Seanad was honoured last week to be addressed by Professor Pissarides, who is a Nobel economics laureate, on the subject of youth unemployment in a recession. I was struck by some of his wise words in the context of the decisions we have to make, the opportunity we will have when we assume the Presidency of the EU and the funding commitments we have to make. He was cautious about the youth guarantee because he felt it was expensive. As far as I know - I might be wrong in this regard - countries like Finland and Sweden which are taking this approach are investing approximately 5% of GDP in this area. Professor Pissarides said that he feels that a four-month timeframe for employment or training is too short, given the scale of the problem. Ireland has a long-term unemployment problem at this stage. I would like to hear the Tánaiste's comments on that. Is he open to taking this approach on board? Can he see a way of influencing Europe in this regard?
It is interesting that Professor Pissarides believes we have a massive opportunity to persuade the powers that be in the troika to split the budget between investment spending and recurrent spending on things like public service and Civil Service salaries. He feels that a component of the budget should be dedicated to investment spending in certain areas. For example, this week we welcomed the European Investment Bank's decision to provide €50 million in funding towards public private partnerships on school projects. He pointed to all the evidence in the IMF research of the multiplier benefit of public investment programmes, job creation projects and education and training. The Government has committed to some job creation projects, particularly in the green economy. I would like to hear the Tánaiste's thoughts on the decisions we need to make. As Deputy O'Reilly just said, youth unemployment is the greatest crisis of our time. It is a scourge that leaves a mark and a scar on people for a very long time. I would like to hear the Tánaiste's views on how he expects to influence what is done in this area. We have to be careful not to take the youth guarantee on board without being sure it is the best thing for Ireland and for Europe.
I compliment the Tánaiste on his success in securing a position for Ireland on the UN Human Rights Council. I congratulate him and his Government colleagues on the tremendous effort they are putting into the whole European project at present. I refer particularly to the position they are pursuing in the context of Ireland's need for a healthy budget. The disparate views that emerge within the EU lead me to despair from time to time. Some of the member states in question are in the eurozone and others are not. If those disparate views are ultimately to be accommodated, we will end up with a mishmash of views, opinions and policies that will achieve neither one thing nor the other.
The Chairman and I recently attended a meeting in Brussels that was addressed by Mr. Barroso. He must have repeated the word "solidarity" at least ten times in the course of his speech. If there is one element that is lacking in every issue that affects Europe at present, it is solidarity. I think the Tánaiste will agree with that. Everything he and his colleagues try to do seems to be frustrated after a few days when somebody makes an offhand remark that creates ripples in the pond and is not of a cohesive nature. I would like to draw particular attention to the budget in this regard.
The Tánaiste mentioned the Greek example. It should have been obvious to our betters in the European scene two or three years ago that it was not possible for Greece to emerge from the extent of the burden it was facing in the time allotted at that stage, especially in light of the nature of the Greek economy. It was obvious to many people that it was not possible. Would it not have been better to recognise at that stage that the system needed to be changed and made a little easier for those who were having difficulty?
The last point I want to make is that we do not seem to be progressing in the same direction. Everyone in Europe does not seem to be facing in the same direction. There are those who want less of Europe and those who want more of Europe. There are those who want integration and those who want out. We cannot make progress in such circumstances. If one state of the United States sought to secede from the union - I do not foresee that happening - I do not think the union could continue to be cohesive. It does not work that way. It is a question of unity of purpose.
I warmly welcome the Tánaiste and the departmental officials. I join others in acknowledging this country's good news on the human rights agenda. It is indicative of the Tánaiste's commitment to delivering for this country that we have secured such a prestigious opportunity to show our compassion at international level.
I would like to raise an issue that is of great concern to me. Like many Members of the Oireachtas, I find the news coming from Uganda particularly odious. The Tánaiste will be aware that the Speaker of the Ugandan Parliament has said that the Parliament intends before Christmas to pass anti-homosexual laws that would impose the death penalty on homosexual people. As the Tánaiste is aware, homosexuals in many African countries - particularly Uganda - suffer from severe discrimination and persecution. The proposed legislation in Uganda would represent a serious escalation and persecution of vulnerable people in those societies. I suggest that pressure is required from the international community, particularly from Ireland and the rest of the EU, to prevent this Bill from passing in Uganda. I would like to ask the Tánaiste if he intends to raise this matter at the EU or with our European partners. He is aware that the Governments of the United Kingdom and Sweden have said they intend to cut off aid from Uganda if this legislation is passed. This seems to be a reasonable proposal that would apply maximum pressure on the Ugandan Government. It is simply perverse for Ireland and other EU countries to supply aid to a country that is guilty of gross human rights breaches. Is the Tánaiste in a position to describe how he plans to approach the matter at EU level? Does the Government have any plans to suspend Irish aid to Uganda if this legislation is not withdrawn?
I wish the Tánaiste well in these negotiations. We would all agree with his statement that Ireland is in favour of a properly funded and properly functioning EU with the right mix of priorities, a fair allocation of resources and a focus on jobs and growth. As the Tánaiste said, the EU needs a budget that is fit for purpose. I agree that it is time to break the vicious circle between banking and sovereign debt. While there may be some disagreements across all parties in the House, at the end of the day we all genuinely appreciate that these negotiations are vitally important for Ireland and for countries right across Europe.
The multi-annual financial framework is set to be slashed by €50 billion yet we are told it will be used to stimulate growth and create jobs. Many people would see a contradiction there. I recognise there is pressure from other countries to cut the budget, that is understandable. If the MFF is used to promote growth and yet it appears it will be cut, what message does that send? Demand for this funding will be greater now than ever.
In regard to the criteria for determining which regions fall into which category for cohesion spending, the Minister mentioned the Cyprus Presidency. Does it represent a good deal for Ireland's regions in terms of accessing EU Structural Funds? Does the proposal from the Cypriots take sufficient account of the economic stagnation across Europe? For those regions that come under a transition category, are there any other mitigating factors in the criteria that will allow regions, some of which are in Ireland, to access more funds or a higher co-financing rate? A brief from the Department to the committee on the options available and where we stand would be helpful. There is a concern in regard to the formula. The position has changed greatly right across Europe. Are we dealing with the realities of today or the realities of the past? Perhaps the Minister would comment.
The Minister referred to the banking and fiscal union. The Constitutional Affairs Committee of the European Union Parliament which appeared before the committee last week suggested that a referendum may be needed on the issue. Does the Government have any advice on that issue?
I will begin with the issues raised by Senator Healy Eames. I reiterate that there is no issue which is more urgent for Europe and ourselves than the issue of youth unemployment. The level of unemployment here at 14.8% is too high and we must get it down. That is the reason the singular focus of Government is towards growing the economy and the creation of jobs. There is a particular problem of youth unemployment which we share right across the European Union, about which there must be an urgency to address. This is not an issue on which we can afford to spend an inordinate amount of time holding seminars and hearings, undoubtedly worthy of comment, on what is the best way to deal with it. There is an urgency about dealing with it. I do not think there is a single silver bullet approach that will deal with it. We have to deal with it at a number of levels. The compact for jobs and growth agreed by the European Council in June is part of addressing the issue. The €120 billion committed to the compact, completion of the Single Market, the completion of trade agreements with countries outside the European Union, such as the US, Japan and Canada, all have enormous potential for growth in the EU economy as well as the measures we are taking to promote employment by attracting inward investment.
The Commission will present the youth transition proposals in December. I expect the youth guarantee scheme will form part of the proposal and it is an issue we want to pursue during the course of the Irish Presidency. These measures are specifically geared to addressing youth unemployment. I am not sure I would agree with Professor Pissarides in his view that one can make a distinction between recurrent spending and investment spending in this context, particularly in the area of youth unemployment, much of which is around issues of apprenticeship, training and further education. It is not possible always to make the distinction between recurrent spending and investment.
We live in a knowledge society. In regard to infrastructural projects, the stimulus package agreed by the Government during the summer is aimed at schools projects, health centre projects, and the recent decision on the national children's hospital. All of those, in addition to addressing service needs, are about the generation of employment. There are areas where the potential for growth and employment is as much about knowledge as about infrastructure.
In the European Union context we are talking about a seven-year budget. That is a false choice that is being presented. It is not easy to make that distinction, particularly where youth unemployment has to be addressed. We need to be careful not to sacrifice the urgency of dealing with the youth unemployment problem for some debate which has its-----
We are not in disagreement with that.
Deputy Durkan made a point about solidarity. The European Union is built on the concept of solidarity. I tend to take the more positive view. The decisions made in June and October are clear demonstrations of solidarity. The decision to proceed with banking union and the decision in October in regard to timelines to complete the legislative framework by the end of the year is a positive signal in regard to solidarity.
To respond to Deputy Keaveney, we have suspended aid payments to the Ugandan Government for reasons other than the one raised by the Deputy. The issue of the legislation which is being considered in Uganda on gay people is a matter we have already raised with the authorities there. I raised it directly with the President of Uganda and with a number of members of the Ugandan Government. I expect it will be pursued at European Union level.
Deputy Crowe raised the issue of the multi-annual financial framework. We need to reflect on what is in the glass when talking about the multi-annual financial framework and the European Union budget. The Cyprus Presidency proposed a €50 billion reduction on what had originally been proposed by the Commission.
However, we need to bear in mind that the Commission originally proposed €1,033 billion for the European Union budget for the period up to 2020. By any standards, this is a sizeable sum of money. While it is our position that we support the Commission's proposal and oppose reductions to it, we also need to recognise that the taxpayers of Europe provide a substantial sum of money for a common European Union budget to be used to promote initiatives for jobs and growth, support agriculture, the regions, innovation, research and education and training, develop infrastructure throughout Europe and do the many things we need to do in common in Europe.
We are pressing for the regions to receive funding. Declines in GDP, increases in unemployment and high levels of youth unemployment are factors and criteria that should be taken into account on the basis of the most up-to-date figures available rather than on sets of figures dating back some years.
I thank the Tánaiste for his attendance. On behalf of the joint committee, I express appreciation for his answers to members' questions in this informative session. We wish him the best at the forthcoming meeting of the General Affairs Council.