Bertie Ahern (Dublin Central, Fianna Fail)

We will continue to keep the matter of the constitution under review. Deputy Kenny is correct that the referendum will not take place this year. I have made clear that we will publish a White Paper in September. I have made no decision about the Bill but I will consult the Opposition parties before moving on that. It will certainly not be before the summer.

The position is that the European Council will look at the constitution again during the Austrian Presidency. That period of discussion and reflection will probably take place closer to next summer. However, if the Austrian Chancellor believes it could be after Christmas, it may prove be the case. A number of countries will proceed with a vote while others will continue with a parliamentary ratification process, which will build up the number of states who have dealt with the matter.

We will see where we are at the beginning of the Austrian Presidency. Some 18, 19 or 20 countries will have dealt with it at that stage. A number of countries will continue with a ratification process. Luxembourg has decided to go ahead with a vote and Poland is likely to do the same from what Prime Minister Marek Belka has said to me. It is important for us not to lose momentum. We should continue on with the European project, explaining the issues and putting forward a White Paper for debate in the autumn. I welcome Deputy Kenny's support for this initiative.

On the financial perspective, I do not disagree with anything Deputy Kenny said. It is a fair analysis of the situation. Members are aware that I was anxious to meet the Prime Minister Mr. Blair because I knew the position he was taking from the COREPER meeting and from the newspapers I saw last weekend. It is diametrically opposed to our position. I will not fudge on that. I agree with Mr. Blair on many issues and we get on very well but I disagree with him totally on this. He does not accept the position that the rebate should be changed and argues that any negotiations on the rebate should be effectively funded out of totally changing the CAP.

He is not seeking a modification of the CAP — I could understand that argument but not accept it — but a fundamental redraft of the entire budgetary position of the Union. I told him on Wednesday that I did not believe we could do that by Friday night. It was not his stated position a month ago and I do not believe it will be the position in six months' time. The entire basis cannot be fundamentally altered. Deputy Kenny correctly noted the changes that arose from the 1992 proposals of the then Irish EU Commissioner for Agriculture, Mr. MacSharry. In Berlin in 1999, significant changes were made to the CAP. In 2002 breaking the link between subsidies and production and moving to a total basis made a fundamental change. I agree with the latter change and, since 1997, I have been on the record in this House as saying that I did not believe the CAP could continue as it was but that a realistic position would have to be taken. I made this point at every meeting I held with the IFA and ICMSA. I have support on this from Deputy Kenny's party.

It is unfair to express the view, as was done in recent days, that the CAP is old-fashioned, negative for Europe or an organisation for backwoodsmen or that reforms have not taken place. I said at this weekend's meeting that this is a dishonest way to present the issue. Regardless of the rows that take place on reform of the CAP, an agreement is an agreement. The third round agreement reduced the CAP budget to approximately 40% whereas it was over 70% in the late 1980s and early 1990s. In 1988, I was involved in the first round of negotiations with Mr. MacSharry as Minister for Finance and thethen Minister for Agriculture, Mr. MichaelO'Kennedy. As Minister for Labour, I addressed the social fund. The CAP then represented approximately 73%. It is now 40% and is likely to decrease further.

The British position is that the entire matter ought to be totally re-phased and the 2002 agreement and its ensuing restructuring should be disregarded only after which could discussions on the rebate begin. I believe this to be a dishonest presentation because, if the negotiating position of countries such as the UK was that there are no resources for other issues, why did they lead a campaign to limit the scope of the EU budget to 1%? I spelled this out at the March Council meeting of the Irish Presidency. Why stick to a 1% argument before the Commission's proposals are seen?

There is no logic in this but a debate was not held. The answer at the recent Council meeting was that logic would not be used nor a debate be held and, as agreement would not be reached, we should all go home. I do not accept this position, which represented a bad day's work for Europe. Deputy Kenny is correct, however, in that one has to move on in order to look for a more logical position. It is neither the first nor the last occurrence of such an event, which probably indicates that long meetings are not the best idea, even for European leaders.

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