Brian Cowen (Laois-Offaly, Fianna Fail)

I attended the meeting of the European Council in Brussels on Thursday and Friday, 19 and 20 March. I was accompanied at the meeting by the Minister for Foreign Affairs, Deputy Martin, the Minister for Finance, Deputy Brian Lenihan, and the Minister of State with responsibility for European Union affairs, Deputy Roche. The agreed conclusions have been laid before the Houses.

The global economic and financial crisis inevitably provided the backdrop to our discussions, as we discussed issues such as stimulating economic recovery and the need for improved financial regulation. However, we also covered other topics, such as energy security and climate change. Policy in each of these areas can bring tangible benefits to Ireland, but by our participation within the Union, we are exercising not only our capacity to shape European issues, but also to influence global issues. Whether on the G20 summit, which will take place tomorrow, Thursday 2 April, the future development of the International Monetary Fund, IMF, the Copenhagen climate change conference later this year or our relations with European countries to the east of the Union, Ireland is helping to shape the Union's policies and how it influences global responses where they are possible.

I will first turn to the economic and financial crisis. In advance of the Council, there was considerable discussion of the different attitudes to economic stimulus. This discussion has continued in the lead up to the G20 summit, with different perspectives on the appropriate scale of the Union's efforts, but we must not lose sight of the relatively generous social protection payments in Europe that are of direct and immediate effect. The scale of the total EU stimulus, both national and central measures, is estimated at about 3.3% of GDP or €400 billion.

There was a shared view that the primary focus of stimulus efforts must be on preserving jobs while ensuring that measures adopted do not amount to distortions of trade or protectionism. As a small trading nation, Ireland depends on access to open trading markets refereed by trusted institutions. A move towards protectionism would hit us harder than most, so we welcome the commitment to keeping markets open on the road to recovery.

We discussed the linkages between the financial and banking crisis and the real economy and the impact on people's lives. The Council welcomed good progress by the European Investment Bank to boost the availability of financing to the small and medium enterprise, SME, sector. We have seen the fruit of that work in recent days with arrangements between the EIB and Irish banks to provide additional lending facilities for SMEs in this country.

On the international financial front, the Council agreed that IMF resources should be substantially increased so that the fund can help members in difficulties. In terms of specific crisis support, EU member states indicated that they are ready to provide on a voluntary basis increased IMF lending capacity of €75 billion. The Council also welcomed the Commission's intention to make a proposal for doubling to €50 billion the overall ceiling for loans for medium-term financial assistance to member states that have not adopted the euro and are experiencing or are threatened with difficulties in their balance of payments. This strengthening of the IMF and the Union's own capacity to act reflects the interdependence of countries and markets, but also the readiness of the EU to ensure that mechanisms to support countries in difficulty are sufficiently robust.

The Council also agreed to accelerate work on more effective mechanisms to regulate financial institutions operating across borders. Building on the De Larosière report, ECOFIN will take this work forward to enable a more detailed discussion at the European Council in June, followed by legislative proposals in the autumn.

The Council agreed the Union's approach to the G20 discussions tomorrow. The Union aims to lead international action to promote a swift return to sustainable economic growth, keeping markets open, strengthening the international institutions such as the IMF so that they can manage and prevent crises, improving the regulation of financial markets to avoid the errors of the past and supporting developing countries in responding to the crisis.

As part of the measures to stimulate economic activity across the Union, the Council agreed on a financing package of €5 billion for certain infrastructure projects. This agreement is very important for Ireland. We have secured funding of €110 million for the east-west electricity interconnector between Ireland and Britain. In addition, there is potential to obtain funding relating to the North Sea grid component of the offshore wind energy initiative and we will also be able to pursue new funds agreed for rural development and rural broadband.

The €110 million funding contribution to the interconnector project is a major achievement. This project is an essential piece of infrastructure for the country for a number of reasons. It will connect our grid to a much larger market, helping to reduce the cost of electricity. It will help energy security by establishing an important new supply route. It is essential for our plans to increase electricity production from renewables, particularly wind energy, as access to larger markets will make it more economical. The EU is supporting this project because it will add to the integration of EU energy markets. This, in turn, is very much in Ireland's interests, improving both supply and efficiency.

The Council's discussion on climate change focused on the UN summit at Copenhagen later this year. The EU continues to give leadership through our unilateral commitment to cutting emissions by 20% and our willingness to do more if others are prepared to play their part in a fair global deal. It is likely that this work will form a key part of Sweden's Presidency, which begins in July of this year.

The Council also adopted a declaration launching the eastern partnership to promote stability, good governance and economic development in those countries to the east of the Union's borders — Armenia, Azerbaijan, Georgia, Moldova, Belarus and Ukraine. The partnership will be formally launched on 7 May in Prague. The Czech Presidency has invited all Heads of State and Government to attend.

I wish to conclude my remarks to the House with some comments about the Lisbon treaty. As we know, there is agreement on the need to reform the Union and the Lisbon treaty is the agreed way of doing that. I spoke earlier of how the agenda at this Council reflected very much our domestic agenda, but of course it is only through our participation in the Union that we can shape the necessarily international response to many of the current challenges. So we need a Union that is effective. For example, on energy, even were the Union not supporting the interconnector, we would want to see our energy market more integrated with the rest of the EU because that is in our interest both as generators and consumers of electricity.

During the Council, I was invited by the Presidency to provide colleagues with a brief update on progress in fleshing out the commitments made to Ireland at the December European Council regarding the Lisbon treaty. I made clear that we are continuing to work towards the June Council as the point at which we would hope to secure agreement on guarantees for Ireland. I reminded my colleagues of the importance of the commitments given last December, including agreement that should the treaty enter into force, the number of Commissioners would not be reduced. I stressed that these guarantees promised in December must be legally robust in order to reassure the public about the treaty. While I respect the fact that other member states do not wish to re-ratify the Lisbon treaty, I made it clear that, for my part, the legal guarantees will have to be attached to the EU treaties at the next possible opportunity.

Presuming that we reach a satisfactory outcome over the coming months, I believe we will have a good basis for consulting the Irish people again later this year. I informed my colleagues that the Government has begun discussions with the Council Secretariat and legal service and remains in close contact with the Czech Presidency to which I expressed my thanks for its support.

We are very much on track for the timeline we envisaged in December, that is, agreement on the guarantees by mid-2009 preparing the way for a referendum before the end of the term of the current Commission. Recent poll figures suggest a favourable disposition among the public towards Europe. It may reflect greater recognition of the importance of the EU to Ireland in these economically challenging times, but I can assure the House that we will not be complacent.

This House and its Members will have an important role to play in ensuring that the public fully understands the issues before it. I recall the commendable work of the Sub-Committee on Ireland's Future in the European Union and I acknowledge that those Opposition parties in favour of the Union and a Europe that can deliver for its people have approached these issues in a constructive manner.

Recent events have, I believe, underlined how vital membership of the Union is to Ireland. However difficult people may find today's challenges, we benefit immensely on a daily basis from our guaranteed full participation in the Single Market and our membership of the euro. These are real strengths, without which our future would be far more difficult. If there is one message that came from the Council meeting, it is that we are stronger when we work and act together. The Council again demonstrated that member states can find the compromises necessary in pursuit of the shared goal of a return to sustainable economic growth and the minimisation of the impact on jobs of this current crisis.

For the information of the House, I had a prearranged meeting with the President of the Commission at the margins of the Council at which we discussed the current economic situation and the situation pertaining to the Lisbon treaty. I also wish to inform the House that I have told President Barroso that I will support his re-appointment as President of the Commission later this year. I believe he has displayed the right balance of leadership and consideration and that the Union will be well served by a second term with President Barroso at the helm of a strong Commission.

See this speech in context