Seán Kyne (Galway West, Fine Gael)
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I ask all those present to turn off their mobile phones because they can interfere with broadcasting equipment.

The purpose of today's meeting is to discuss Luxembourg's Presidency priorities. I welcome H.E. Mr. Patrick Engelberg, ambassador of Luxembourg to Ireland. Luxembourg's Presidency priorities are wide-ranging and ambitious. The Presidency seeks to deepen the concept of a social Europe and revitalise the Single Market with a focus on digital technology. Issues of great significance to Ireland are the Presidency's priorities for completing EMU and in the area of taxation. The Presidency, of course, has many other priorities. We look forward to exploring these in more detail with the ambassador.

Members are reminded of a long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses, or any official by name in such a way as to make him or her identifiable. By virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of the evidence they give before the committee. If they are directed by the committee to cease giving evidence in relation to a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any persons or entity by name or in such a way as to make him, her or it identifiable.

I invite the ambassador to make his opening remarks.

H.E. Mr. Patrick Engelberg:

It is a great pleasure and honour to present to the Joint Committee on European Union Affairs the programme of the Luxembourg Presidency of the Council of the European Union. It is Luxembourg’s 12th Presidency and the first since the Lisbon treaty fundamentally modified the functioning of the EU and the relations between its institutions and, of course, the role of the Presidencies.

Ireland showed us in 2013 that, despite these changes, a committed Presidency can make a difference. It is in that same spirit that we see this as a genuine opportunity to show our commitment vis-à-visEuropean integration and to the principles and values the European Union is built upon. Our approach is based on outreach and openness: listening to the citizens, supporting enterprises, and collaborating with partners and institutions with a view to acting in the general interest of the EU.

The Presidency will endeavour to put the citizen at the heart of the European project as the title of its programme suggests - A Union for the Citizens. The Luxembourg Presidency programme focuses on continuity and on the thorough implementation of the strategic agenda adopted by the European Council in June 2014. It duly takes the policy orientations of the President of the European Commission, the Commission’s annual work programme and the work of the Trio Presidency into account.

The Presidency programme is divided into seven key priorities covering the main challenges the European Union faces today. Given the post-crisis context, stimulating investment to boost growth and employment is an indispensable response to the main concern of the European citizens. The actions of the Presidency will build on the Investment Plan for Europe of the President of the European Commission and will focus strongly on putting a better regulatory framework for investments in place, in particular for SMEs. It will also promote the establishment of the Capital Markets Union in order to enable capital markets to play a bigger role in the financing of the economy. The Presidency will pay particular attention to two legislative proposals linked to the CMU - first, a proposal to ensure transparent, simple and high-quality securitisation in order to revitalise a market that has not yet returned to its pre-crisis levels and to address the risks associated with securitisation and, second, the review of the prospectus directive in order to facilitate access to capital markets for SMEs.

Luxembourg will emphasise and give a strong impetus to the social dimension of the EU. Social investment policies must go hand in hand with the European Union’s goal to create more sustainable growth. Measures against unemployment and the convergence of social policies rank high on our agenda. The Presidency will lend its full support to the Commission’s efforts to relaunch the social dialogue in order to ensure better economic and social governance at European level. The Tripartite Social Summit, which will meet before the autumn European Council, will be an opportunity for a constructive exchange between the social partners, the European Commission, EU Heads of States and Governments and Luxembourg’s and the Netherlands’ Ministers for Labour and Social Affairs.

Managing migration, combining freedom, justice and security will be a further priority. The Presidency will push for progress in the different fields covered by the Justice and Home Affairs Council, ranging from family law and data protection to internal security as well as immigration and asylum policy. The fight against terrorism and the agenda on migration are pressing issues for Europe as a whole and must be addressed quickly in order to provide adequate responses. Even if internal security is primarily the responsibility of the respective member states, we believe that the EU can provide added value, for instance, with the implementation of a European passenger name record or the reinforcement of external border controls, information exchange and operational co-operation.

Furthermore, it is the Presidency’s ambition to revitalise the EU Single Market by way of an improved recourse to harmonisation and mutual recognition. Particular attention will also be paid to the development of a genuine digital single market, which bears new opportunities for citizens and a forward-looking economy. The three pillars of the digital single market strategy proposed by the Commission supported by the Luxembourg Presidency and which, as we know, are of particular relevance in Ireland, are: better access to digital goods and services; the shaping of the right environment for digital networks and services to flourish; and maximising the growth potential of the digital single market. We believe that this project should be at the core of the Single Market strategy. As our Minister in charge of this dossier cited recently, we want to get rid of having 28 mini-markets and instead have one big market.

The Presidency will support efforts for better regulation to ensure a European level-playing field, facilitate competitiveness for businesses and protect the interests of the EU citizens. We will support efforts to implement the Regulatory, Fitness and Performance Programme, REFIT, seeking to identify and highlight the European added value. To improve the functioning of the Single Market and to stimulate growth, it would be useful to adopt common European rules in order to achieve legal certainty for market players, failing which, 28 national legislations would be applicable.

Boosting European competitiveness in a global, transparent framework is another of our priorities. Thus, the completion of the European Monetary Union as well as the fight against fraud and tax evasion will be two key areas of work for the Luxembourg Presidency. Transparency and the creation of a level playing field are key preconditions to ensure competitiveness. The Presidency aims at successfully concluding the negotiations on the proposal for transparency on tax rulings as proposed by the Commission.

The international trade agenda will be a key topic in Luxembourg’s programme with the signing of the CETA agreement with Canada and the negotiations on the Transatlantic Trade and Investment Partnership. As Luxembourg’s Prime Minister, Mr. Xavier Bettel, made clear recently, “during the Luxembourg Presidency, TTIP will not belong in a darkroom”. Therefore, a public debate will be organised by the Presidency in November in Brussels.

The Presidency will endeavour to promote sustainable development for the benefit of European citizens by supporting the transition towards a green, innovative and circular economy. The Presidency will steer the discussions in the EU at the 21st Conference on Climate Change, COP21, in Paris in December and will combine its efforts with the European Commission to ensure that the European voice is heard. Europe has to assume its responsibility to tackle the issue of global warming effectively. Luxembourg will help contribute to the establishment of objectives for sustainable development that will replace the eight millennium development goals.

The Presidency will seek to strengthen the European Union's presence on the global stage. We will endeavour to develop the existing relationships with its closest partners by updating the European Neighbourhood Policy. Furthermore, the Presidency will work towards the consensual adoption of an annual enlargement conclusion in December. The meeting of ASEM foreign affairs ministers in November will be one of the highlights of the European foreign policy agenda.

This year, 2015, which has been declared European Year for Development, will also be a pivotal year to bolster the EU’s credibility by taking decisive action in the field of development co-operation and humanitarian aid.

The Presidency will host the closing ceremony in December and, therefore, has a responsibility to inform and raise awareness among European citizens. It is with these key priorities that the Luxembourg Presidency will commit itself to moving the European integration project forward so as to ensure that our Union will be better equipped to face the challenges of our time. The past few weeks gave us compelling examples of some of these challenges. The tragic loss of life in the Mediterranean and the recent events in Calais highlight the necessity for a European response to the thorny migration issue. The terrorist attacks perpetrated very recently, which hit Ireland cruelly as well, along with those carried out earlier in 2015, require a strong and united reaction.

Luxembourg is proud to be able to make its contribution to the European project. Together with our European partners, including Ireland which is deeply committed to European integration, we will endeavour to tackle all the challenges the EU as a whole has to face to maintain the spirit of the EU. We will endeavour to find constructive solutions to address the concerns and interests of all member states.

I thank the joint committee for giving me this opportunity to present the priorities of the Luxembourg Presidency and I look forward to further good collaboration and questions from members. We are prepared for a Presidency that will not be routine.

Seán Kyne (Galway West, Fine Gael)
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I thank the ambassador for his comprehensive opening statement. The committee will be examining the Five Presidents' Report on the EMU in the autumn. The ambassador referenced the current situation in the Mediterranean, which perhaps forms part of the non-routine matters for the Luxembourg Presidency about which he spoke, and also managing migration, immigration and asylum policy. As there appears to be no end to the flow of migrants from various parts of Africa and neighbouring regions, what in the ambassador's view can be done? We are all aware of the comprehensive search and rescue operations that have taken place, in which Ireland and other countries have played a part. The more migrants that are settled in Europe, the greater the incentive for a continuous flow of migrants. I would welcome the ambassador's view, or that of his Prime Minister, as to the proposed solution in that regard.

H.E. Mr. Patrick Engelberg:

I thank the Vice Chairman for his questions. One might get the impression from the priorities of the Luxembourg Presidency, which I have just outlined, that we are slightly disconnected from what is going on in the world but that is not the case. The Luxembourg Presidency is charged with finding a solution to the relocation and reinstallation of refugees. We appear to be making some progress. The latest report I read on the matter shows that thus far, 23 countries have signalled to the Presidency that they are willing, on a voluntary basis, to take some refugees. However, the final numbers in this regard have not yet been determined. On a national basis, Luxembourg has agreed to take 515 refugees, which includes the relocation of approximately 260 refugees, with the remainder to be reinstalled. This equates to approximately 0.1% of the Luxembourg population. This is a first response to the emergency. We are fully aware that this will not solve the problem and that we need to find a more durable and sustainable solution to this crisis. Collectively, we are still faced with a huge problem, originating in those countries from which the refugees are arriving. Additional solutions designed to stop people drowning in the Mediterranean are required. While Luxembourg is providing support in this regard solutions must be found with the countries of origin. There are currently in place a number of programmes to assist in the strengthening of structures in countries where these structures have almost disappeared. The aim must be to find long-term solutions. Luxembourg will be supportive of all that can be designed in this context. We must be prepared to face a long-term endeavour.

Seán Kyne (Galway West, Fine Gael)
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The United Nations representative for economic development and migration, Peter Sutherland, appeared before the committee a number of months ago, at which time he suggested that there should be processing centres in the countries of origin or a country within the North African area. Has the Luxembourg Government given any consideration to that proposal?

H.E. Mr. Patrick Engelberg:

It could be considered by the Government but it would require the co-operation of the countries of origin. Some are already equipped to help us but others might not be. It is definitely one of the solutions we should be exploring.

Seán Kyne (Galway West, Fine Gael)
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I thank the ambassador.

Bernard Durkan (Kildare North, Fine Gael)
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I welcome the ambassador and thank him for attending the committee to lay out the stall of the Luxembourg Presidency. I wish him and his Government every success during the course of that Presidency.

I welcome also the seven matters of priority mentioned, including stimulating investment to boost growth and employment, the importance of which we are aware of in Ireland. We hope that Luxembourg is successful in that regard. On the second priority, deepening the European Union's social dimension, following the recent serious economic downturn, there is an urgent need to address the social issues in any way that is within our capacity. It is most important to recognise that this is necessary.

The ambassador has already responded to questions from the Vice Chairman on the third priority of managing migration, so I will move on. On revitalisation of the Single Market by focusing on digital dimensions, which is an excellent objective, I hope that we capitalise on it to the best of our ability. The ambassador also mentioned boosting European competitiveness in a global transparent framework, which is welcome.

The common consolidated corporate tax base, CCCTB, is an issue that is likely to be dealt with in the course of Luxembourg's Presidency. Ireland has received a great deal of criticism over the past couple of years on the basis that it, allegedly, operates an unfair system in terms of facilitating foreign direct investment companies here. It goes without saying that a 12.5% tax was applied to all manufacturing undertaken here by foreign investors. The allegation was made that some companies in other jurisdictions were re-routing their profits through Ireland. There is no proof of that. Ireland is not at the centre of the European market. It is an island nation on the periphery of Europe. The only way off this island is by aeroplane or boat. It is not possible to drive to the centre of Europe from Ireland. There are issues in this regard that need to be borne in mind in the context of the debate that will take place around the levelling of the playing field, which we hope will happen. Ireland is often accused, including by some senior politicians at the centre of the European Union, of operating at an unfair advantage. I refute that. We have had a system in place that is open and transparent and is necessary to ensure we can compete on a level playing field.

The debate around the economic crash is ongoing at the centre of Europe, in particular in relation to Greece. I am not familiar with all of the ingredients of that debate. We get our information via the media, in so far as we can. I believe there is a necessity at this stage for realism around what the European Union and members states engage in. We are on the world stage. A procrastinated debate is demeaning to the European Union and to member states. It should not continue indefinitely. There are procedures in place to deal with this type of situation.

In the case of a member state falling into economic difficulty, there are economic stress tests that take place. They are well known. Those who read economics will know this, and I apologise to all economists in the House, but it is not rocket science; it is quite simple. In effect, it is a due diligence report that indicates the capacity of a company or a country to bear up to its economic or fiscal responsibilities. It should be possible to identify a route and a path within that, keeping in mind the necessity to recognise the ability of the individual country's economy to stand up to the pressure generated by the situation that has developed, which we in this country unfortunately had to face and not without considerable stress and hardship. Moreover, it has not gone away and will not for a considerable time. I emphasise the importance of the focus for the good of the European Union, for the good of the people of each member state of the Union and for the good of those countries that already have made sacrifices and those which continue to be obliged to make sacrifices, while appealing to all concerned to address the issues fairly and honestly and not in a political way to seek advantage of the situation.

H.E. Mr. Patrick Engelberg:

I thank Deputy Durkan for his contribution and for his encouragement. I will come back to two topics he raised, the first being the common consolidated corporate tax base, CCCTB, transparency on fiscal matters and fiscal rulings. Generally, the Luxembourg Presidency decided it would put on the agenda all the financial and tax questions that have been raised in the recent past. Although it might not be obvious to some member states to expect this of Luxembourg, we thought that first it is our duty as a Presidency and that second we believe strongly in the level playing field and that the same conditions and same level of information should apply to all. The finger is pointed at some member states because they allegedly seem to have certain systems which are then presented as being disruptive. Luxembourg also often faces criticism or attacks and we thought the best thing to do would be simply to put it into the open, have a general discussion on it and not to be looking at one country or another. This is why we wish to make progress on CCCTB, on base erosion and profit shifting, BEPS, and on other items as well. However, to be productive and to avoid creating a system where we might harm ourselves or even collectively as the European Union, we are very much in favour of aiming at OECD standards rather than European Union standards. This is because OECD standards would be much broader than would European Union-only standards.

On Greece, obviously this is an extremely difficult and delicate situation, which has not been made easier since last Sunday. All the resources seem to be mobilised this week to find a solution. Emergency meetings at the level of the European Council have been called and there will be another one on Sunday. In addition, there will be another meeting of the Finance Ministers on Thursday. I read this morning that President Obama has called the Greek Prime Minister in order to understand the situation and also perhaps to advise him that good progress should be made. It obviously is a huge issue and problem that does not merely concern Greece, the eurozone or the European Union as the whole world is looking at us. The Deputy is absolutely right; the European Union must get it right because, otherwise, we will lose credibility. One message that was made clear yesterday to Prime Minister Tsipras is that we are running out of time. Certain of our fellow leaders made stronger comments than others, while some of them gave the impression they might be a little more flexible on finding a solution. While that certainly is a good state of mind, Luxembourg as a country on a national basis could probably accept a further degree of flexibility than it would be able to propose as a Presidency. That is also what my Finance Minister said very strongly yesterday. Whatever solution is found, one must bear in mind what other countries in similar situations endured and accepted measures, which then eventually helped them to rebound and improve the finances of those countries. Obviously, while one cannot compare totally one country with another, in looking at what sort of solution can be found for Greece, one also should bear in mind what has been accepted by other countries in similar situations. Let us then see what will emerge this week. Sunday has been presented as the last possible day to find a solution, after which we probably will be in a different world. I also read that President Juncker has stated he has a Grexit scenario ready in his drawer. While it is not a perspective anyone is contemplating with anticipation, the Deputy is absolutely right that at some stage, we must take a decision, which, obviously, Greece must do also.

Joe O'Reilly (Cavan-Monaghan, Fine Gael)
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I welcome the ambassador and thank him for setting out the priorities of the Luxembourg Presidency, which members strongly support. They also wish Luxembourg well with its Presidency. The Vice Chairman started his discussion with the ambassador by asking about the specifics concerning migration, to which the ambassador in turn replied. Similarly, what might he say by way of specific measures regarding terrorism? I acknowledge it is an extremely difficult and complex area, requiring a multifaceted approach. That said, the ambassador should set out what are his thoughts and those of the Luxembourg Presidency on specific actions, both by way of controls, etc., and societal changes to eliminate or reduce terrorism as a risk.

I will turn to another issue that has not been referenced by my colleagues and, therefore, merits reference. The ambassador correctly identified the forthcoming conference on climate change in Paris as being of enormous importance. His submission further mentioned Luxembourg's desire to make Europe an even greater player on the global stage. How successful does the ambassador think Luxembourg could be in getting our international partners to buy into the notion of climate change, solutions to climate change and to the question of carbon emissions? How persuasive, as a moral force, could the European Union be in this regard in respect of its international partners and perhaps otherwise? What things could be done to achieve this goal, which would be a great and necessary use of global influence given it is a reasonable proposition that we in the European Union accepted? In the context of climate change, the ambassador should comment briefly on the areas of solar and wind energy. While Ireland has a considerable number of wind energy options and turbines under development, I do not believe sufficient solar energy has been developed. Does the ambassador wish to comment on that and on the wave energy issue? Lastly in that context, the ambassador should comment on the state of nuclear energy and the current position with regard to dealing with the waste therefrom. Does he envisage nuclear energy providing part of the solution into the future?

Finally, with the Vice Chairman's indulgence, we are very proud in Ireland of having reached an unemployment rate of 9.7% while, of course, not being happy with that percentage. This is because nothing better achieves social equalisation, social fairness, the liberation of people and a fair society than giving everyone the dignity of work and the ability to participate in the economy through the opportunity to work. This is the great social equaliser and is the catalyst rather than any kind of paternalistic injection of benefits. While we are proud of the position we have reached in that regard, as we want to go further and reach full employment, we have another few percentage points to go. In that context, the commitment of the Luxembourg Presidency to developing the whole jobs area is important, as is its commitment to developing on the €315 billion proposed investment by the Commission in this regard.

Could the ambassador be specific about where he sees those jobs and what he thinks the Luxembourg Presidency can achieve practically? If people outside here are watching this meeting, the one thing they would want to get from Luxembourg’s Presidency is jobs. Although every objective the ambassador spoke of is important, nothing takes precedence over job creation and giving everyone the dignity of work. Nothing is a greater scandal in the EU than youth unemployment. That is the great scandal of our age. People who have retired are back at work and there is massive youth unemployment across Europe, which needs to be addressed. I look forward to the ambassador's comments. I am asking him to flesh out some of his thoughts, the specifics of how the objectives will be implemented.

John Halligan (Waterford, Independent)
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I have been in Berlin with some colleagues meeting members of the German Parliament and Government. Does the ambassador think there should be a write-down or cancellation of the Greek debt, or, as some of us would prefer, that the debt should be parked to give Greece some time to organise its economy? Most of us believe that the Greek economy is a failed entity and has been failing for many years. There is a question as to whether it should have been allowed into the eurozone in the first place because it had a failed banking system and economy and an inability to collect tax. If a government cannot collect tax in an economy, it is bound to fail, and that is exactly what happened in Greece. There is a view that, having had a military dictatorship for many years and come through periods of intense and absolute corruption, which the German and French governments have acknowledged, it is a bit unfair to come down heavily on the current government on the basis that it has been in power only since January and needs some time to stabilise its finances and economy.

I have been to Greece on many occasions and have met Syriza and other parties there. The view there is that the people have taken this out of politics. Many have said to me there is nothing worse that can be done to them. There are 300,000 houses without electricity, there is 60% youth unemployment and 30% unemployment overall. A friend of mine, who happens to be a Jesuit in London, has just returned from Greece where he spent three years. He tells me that people here do not realise that some areas outside Athens are as near as one can get to Third World status. He met a businessman – this is very relevant – who had 1,700 employees but lost his business and everything. My friend was in this man’s house. He had no electricity and very little food for his family. He asked what more Europe could do to him, how could it get any worse for him. I felt, based on the people I had met in Greece, that there would be an overwhelming "No" vote, whether or not it was right to vote that way. As an outsider, does the ambassador believe that the Greeks need compassion?

Economists all over the world, including American and German economists, whom we have met, have said the Greeks cannot pay this debt. They cannot pay €360 billion or €380 billion. They do not have it. For the past six or seven years, the EU has been asking Greece to increase tax and reduce spending, which will make the economy crumble further. What would be the Luxembourg Government’s view of parking the debt?

Migration affects all aspects of the European community. It is a very complex issue. Many of the people migrating into Europe are running away from terrorism and feel they have no choice but to leave the country they are in. They are also fleeing economic misery. It is all very well for us to talk about the number of migrants coming into Europe and how they might overflow across Europe but we do not know how we would feel if we were in the same situation and had to leave our country because of terrorism or an economic collapse. The attitude in Europe appears to be that nobody knows what to do, how many each country should take, if any at all, and how to deal financially with the hundreds of thousands it is estimated will come through Europe over the next few years. There is no question that will happen because there seems to be no end to the instability in Libya. We are faced with huge migration and the question of what to do about it. We cannot simply corral hundreds of thousands of people and leave them. We have to find some system for dealing with them, economically and politically.

The main issue, however, is Greece and whatever happens there over the next couple of days can have far-reaching consequences for all of us in Europe.

Joe O'Reilly (Cavan-Monaghan, Fine Gael)
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Do Standing Orders allow me to comment on an aspect of the question that my good friend and colleague from the Council of Europe, Deputy Halligan, has asked? I would like to comment on part of his question. Is that allowed?

Seán Kyne (Galway West, Fine Gael)
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Yes.

Joe O'Reilly (Cavan-Monaghan, Fine Gael)
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While all the points Deputy Halligan makes are very valid, in respect of Greece, until the new government came into office Greece had been making significant progress in the preceding years as shown by its bond yields and general standing internationally. Would Deputy Halligan accept that great progress was being made until this government arrived in Greece? I say that with respect to Deputy Halligan.

Seán Kyne (Galway West, Fine Gael)
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I do not want a debate between the Deputies but Deputy Halligan may reply quickly.

John Halligan (Waterford, Independent)
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There is no question but that it is the case. However, we have to judge the quality of life of the people in a country.

Joe O'Reilly (Cavan-Monaghan, Fine Gael)
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There are huge issues.

John Halligan (Waterford, Independent)
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There are massive issues and I have been the first to acknowledge that it was a failed economy, with terrible corruption. I am not a fan of Syriza by any stretch. I have met its members. I am making the point that it has been in government only since January. How unfair would it have been for us in opposition to say of our Government after four months in power that it was ruining the country, something I have never done? I think Syriza needs that bit of time.

H.E. Mr. Patrick Engelberg:

I thank Deputy O’Reilly for his questions on climate change and other issues. His first comment was about getting international support. At this moment, it looks quite encouraging as big global players are already making offers to reduce their own carbon emissions. In its EU Presidency Luxembourg will play a role but it will be one of internal EU co-ordination, with the Commission. The French are very active because they are chairing the conference in Paris and want it to be a success and seem to be successful.

Solar and wind energy are encouraged in Luxembourg. Our government is a coalition with the Green Party and we have a Green Minister for the Environment, which reflects the general awareness of the Luxembourg public of environmental issues. These policies are encouraged. We have a lot of wind energy, not quite as much solar energy because we seem to have a similar climate to Ireland’s, but we do want to push this during our Presidency. Nuclear energy is a bit more complicated because Luxembourg is not in favour of nuclear energy and for the concrete reason that one of the biggest nuclear energy plants in the EU is across our border.

The Cattenom nuclear power plant in Franceis the subject of major political debate in Luxembourg, to the point that our Government decided years ago that we would not want to use electricity generated from nuclear power.

The issue of unemployment was mentioned. We all admire Ireland's record on fighting unemployment since the crisis. This is also the first priority of our programme. Unemployment and access to work is what European citizens care about. This is why we think it is the first major issue we should tackle to make the European Union relevant. If we are not able to set a framework where employment is created in the EU, our citizens will wonder what value the EU is giving them.

I mentioned the digital economy, which we view as a transversal element of the economy. To make it possible, people must have digital skills. We need to educate our youth and also enable people to enter the digital economy in the first instance to find work and then avail of the social dimension to it. More and more people are excluded from economic changes and access to services and goods because they do not have the necessary skills to be able to enter the digital dimension of society. We therefore also need to do something about this and to invest in skills and human capital.

Deputy Halligan raised the question of Greece. I indicated earlier that the Luxembourg Government would be able to accept more in its national approach than it would table as a Presidency. We could eventually live with a certain write-off of the Greek debt despite the fact that we have extended more than €400 million in this context. As one can imagine, it is not our preference. We would rather contemplate a restructuring of the debt and giving the Greek people more time to pay their debts and reorganise their economy in order that they can put themselves into a condition where they can envisage reimbursing those who lent them money rather than deciding the countries would write off part of the debt. As I said earlier, it is very important to us that when we come up with a solution for Greece, it should respect what has been done by other countries which had been in similar situations and were able to tackle their national economic problems.

On the question of migration and refugees, we believe we need to take a long-term approach to solve this problem. The Deputy is absolutely right that many people are leaving their countries of origin because they are fleeing war, civil war, dictatorships and terrorism. As long as the root problems which give rise to immigration are not tackled, we will face more and more refugees trying to come to Europe. It is easier to cross the Mediterranean now than during the winter months and we will face more waves of refugees. We try to find solutions to relieve countries such as Italy and Greece who are at the forefront. It is not easy. We, unfortunately, had to acknowledge ten days ago that there were difficulties at European Council level in coming up with solutions. We, as the country hosting the Presidency, have been asked to look into a scheme to deal with the first emergency problem which is to deal with the 40,000 plus 20,000 refugees, but we are fully aware this is not the solution to the problem. The processing centre will help us to select those who can be classified as refugees and allowed into the EU in order that we can try to find a solution for them. Given the situation in the countries we are talking about, the numbers will still be very important.

Aideen Hayden (Labour)
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First, I thank His Excellency, the ambassador, for being with the committee today. I apologise for having to absent myself as I was obliged to leave for a vote in the Seanad and, unfortunately, we do not adjourn for votes in the Seanad. I also apologise if I am repeating questions that my colleagues have asked.

I am not going to go over the ground that has been covered on Greece, but does the ambassador think the steps the EU has made toward a more robust banking union will reduce the risk of contagion in the event of an unfortunate Greek exit from the eurozone?

In the course of his statement the ambassador said: "Measures against unemployment and the convergence of social policies rank high on our agenda." That is a very welcome statement. From my experience there has been a certain amount of concern that the Europe 2020 strategy has fallen off the agenda and, in particular, the measures to deal with poverty seem to have been dropped from the lexicon. Given that more people are experiencing poverty than at the beginning of the strategy, I welcome the ambassador's commitment to the convergence of social policies. I assumes His Excellency approves of the additional measures being taken to deal with poverty, which I think impacts on all of Europe, including Greece.

The ambassador mentioned the importance of the establishment of the capital markets union. We are in favour of and made observations on this policy. An issue that concerns Ireland is the definition of what constitutes an SME. An SME in Ireland is quite a small company in comparison with what an SME would be in some of the larger European countries. We are concerned that difference across the Union would be recognised in that area.

My final issue relates to Brexit. As I am sure the ambassador knows, the idea of Britain exiting the Union is of enormous concern to this country for a number of reasons, both in terms of history, our shared border and our status as English-speaking islands on the periphery of Europe. There are many other reasons, not least our extensive trading relationships, as to why we would regard the British exit as a matter of significant importance to us and a debate in which it is very important that Ireland engages. What role does His Excellency see the Luxembourg Presidency playing in terms of the negotiations around the UK-EU relationships? In that context I wish to address two themes in this address, the first of which is revitalising the EU Single Market, which has been identified as a priority for the negotiations around Brexit.

Mr. Engelberg mentioned more efficiencies and more cohesive regulation and spoke about European added value. To what extent does he see this assuaging British concerns that Europe is overly bureaucratic? Does his concept of European added value involve more or less bureaucracy? He mentioned more social cohesion, which I would welcome, and the importance of committing to moving on the European integration project, which seems to imply moving towards the ever closer union, as expressed in the treaty. This is an issue which Britain has flagged as a concern and it wishes to have treaty change with regard to this choice of words. On the one hand Mr. Engleberg seems to be assuaging British concerns but on the other, Luxembourg's priorities for the Presidency seem, to some extent, to fly in the face of some of Britain's concerns, particularly with regard to social cohesion and bureaucracy.

Seán Kyne (Galway West, Fine Gael)
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With regard to the UK, the committee produced a report last month, with which we will deal in private business. It will be sent to the institutions and I am sure Mr. Engelberg will receive an official copy of it, if he has not already done so. Mr. Engleberg mentioned the public debate in November on TTIP. What is the Luxembourg Government's opinion on the investor state dispute settlement, ISDS, arrangements? From what we hear, some of the larger states have concerns about it. Several weeks ago we had a cross-committee hearing where the Minister for Jobs, Enterprise and Innovation expressed the view that we need to be vigilant about ISDS and we need to debate it.

H.E. Mr. Patrick Engelberg:

I thank Senator Hayden for her questions. On Greece, we did well to have the right instrument to make our banking sector more robust and cut the link with the sovereign, but the Greek problem is much broader. Let us not to prepare for the worst but if there were an eventual default in Greece, the eurozone and EU banks would be affected. We do not know to what extent because we do not know what provisions have been made. I expect provisions have already been made in various countries. The instruments we have in the eurozone should help us overcome it but, nevertheless, it would be a difficult moment for the entire banking world and not only in the EU because we know the US and China are looking at the situation in Greece with great concern. It would have a global impact.

Luxembourg has made social measures its second priority because our country is very much based on social cohesion. We have placed it so high on our priority list because we believe it is important to have a strong social cohesion policy nationally and we feel it is necessary in the EU to show citizens we also care about this aspect and not only about austerity policy, which has been important and essential to introduce new discipline in our finances. We also need to take care of the needs of European citizens. This does not mean we focus only on welfare benefits or giving more money. As we discussed earlier, it also means investing in education, human skills and human capital and creating jobs. The best way to alleviate poverty is to make it possible for those who are excluded from the labour market to access decently paid jobs. This is the best solution we can propose to fight poverty.

I take Senator Hayden's point on SMEs in Ireland. They are comparable to SMEs in Luxembourg where the companies are also very small. One of our main arguments on Capital Markets Union is it will allow us a means to access financing via the capital markets and not only via lending from the banks, which at times has proven to be more difficult. I imagine this point on the variety of structures of SMEs is taken into account in the ongoing reflection. Luxembourg is very much involved in and committed to Capital Markets Union, but we know it will be a medium and long-term endeavour and not something which will be done by the end of the year.

On Brexit, Senator Hayden is right to point out some of the themes and issues in our programme are more likely to suit making the EU leaner, more fit, less bureaucratic and more efficient and other parts of our programme might be less attractive. That is how it is. Luxembourg has its own EU agenda, because we are a very committed and engaged member state and we want to make progress on European integration. I did not mention that Luxembourg is in favour of an EU public prosecutor, which is also something not desired by other member states.

Aideen Hayden (Labour)
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The British will love Mr. Engleberg for that.

H.E. Mr. Patrick Engelberg:

As much as some countries have their views and sometimes express them very forcefully, others have different views and this is what the EU is about. It is about shaping compromise. At the end of the day, we will not have one or the other in the short term. At the EU Council ten days ago, Prime Minister Cameron presented the four main topics they would like to discuss with EU member states. This discussion has been launched and we have a rendezvous clause for December. Luxembourg is not formally involved in this through the Presidency, in the same way as we are not formally involved with Greece or other topics. The Presidency is no longer what it used to be. We now have a permanent President of the European Council and President of the Eurogroup. The institutions have various competencies and roles. Faithful to our tradition of trying to find solutions, make deals and progress the European project, we will be very active behind the scenes and we will try to build bridges between the positions. It is the same with Brexit, although I should not call it Brexit as it is about renegotiation and reform of the EU. There have been a number of high-level contacts between Britain and Luxembourg in recent weeks. We are very aware of the issues the British want to raise with us all and we assured them that, as always, Luxembourg will be an honest broker and will try to help everyone find proper solutions.

Luxembourg like other countries is very concerned about certain aspects of TTIP, particularly ISDS. We very much expressed the view that dispute settlements are still for national parliaments and systems. In May, Luxembourg was among five countries which proposed an alternative to what was on the table.

The proposed alternative was a more permanent tribunal of independent judges dealing with dispute settlement, rather than something that could be seen as less transparent and impartial. Otherwise, Luxembourg is very much committed to progressing the TTIP negotiations. Earlier this year, we were quite optimistic that we could achieve something before the end of the year. This optimism seems to have vanished a little now. Nevertheless, we want to move it forward as much as we can by the end of the year.

John Halligan (Waterford, Independent)
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The difficulty with TTIP initially related to the proprietary negotiations that took place. Some 96% of the people involved in those negotiations represented corporate bodies, and the European Parliament, the Council of Europe and the Human Rights Committee in Europe, for instance, were excluded. Even in America, many democrats and almost all of the trade union movement - like the trade union movement across Europe - have grave problems with TTIP because of the accountability issues relating to the negotiations and the amount of information being given to people. It is interesting that MEPs across different parties in Europe are saying they feel they have been excluded and their parliaments are being excluded. Quite bluntly, the ordinary everyday person does not know what TTIP is, and very few others do, because a lot of the negotiations are taking place in secret, which is the difficulty with TTIP and something that needs to change dramatically. As I said, even elements within the American Government have reservations about how it is being dealt with across Europe.

H.E. Mr. Patrick Engelberg:

It is indeed sometimes interesting to notice that all the problems with TTIP raised in Europe find their echo in the US. We are not the only ones having problems with certain aspects of it, such as transparency and secrecy, as Deputy Halligan mentioned, and investor state dispute settlement, ISDS, as the Vice Chairman mentioned. There are similar concerns in the US. That is true. My impression is that the Commission understands this message on transparency and openness and has now adopted a much more open and transparent approach. I think it has been understood that this is the biggest obstacle to public acceptance of TTIP. All of the 28 member states and the Commission believe that TTIP is a positive instrument to boost trade between Europe and the US so long as certain guarantees and conditions are met. Deputy Halligan mentioned some and the Vice Chairman mentioned another, which is ISDS. It is also interesting to note that the debate is not exactly the same in different countries. Some countries seem to be more sensitive to certain aspects of it. Public opinion in Luxembourg is also quite sensitive to the matters of transparency, democracy and accountability, and what ISDS could mean if we had gone along with the first version of it.

Seán Kyne (Galway West, Fine Gael)
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Commissioner Malmström appeared before the committee earlier in the year to discuss TTIP and talk about the transparency issues, and she gave a full account. She also attended the plenary session of COSAC in Riga a number of weeks ago. I thank the ambassador for his presentation and his engagement on a wide variety of issues. I wish him every success during the six months of Luxembourg's Presidency. He has very pressing matters to deal with in respect of the Mediterranean and Greek crises, which will somewhat overshadow others, but there is a wide variety of priorities. I thank him for his attendance.