Michael Mulcahy (Dublin South Central, Fianna Fail)

I welcome this Bill in so far as it amounts to Ireland's effort to help a fellow eurozone member, namely, Greece. I welcome the Minister's speech and I agree with it entirely. It is quite clear, however, that more needs to be said.

The first issue I would like to raise is the issue of scrutiny of all that has transpired in recent weeks. The Lisbon treaty promised greater scrutiny of EU matters, especially by national parliaments, and contained specific protocols in respect of scrutiny and subsidiarity issues, yet this debate is the first on this issue, either in the Chamber or in any Dáil committee. I have to put my hands up as a member of the Joint Committee on European Affairs and the Join Committee on European Scrutiny. This matter has been trundling along for some weeks, beginning on 11 April when finance ministers across Europe agreed to the terms of the formal support to be given to Greece. On 14 April the Government agreed with this and approved the preparation of legislation. On 8 May the European Commission signed the loan facility agreement. I appreciate that things happen quickly in international financial markets. However, the lack of scrutiny on this issue to date has been inadequate. We must look at more in-depth scrutiny of other vital EU issues as they move along. I hope colleagues can agree with me in supporting that general point.

The terms of this assistance to Greece have been set out by the Minister and the Minister of State. It consists of €110 billion over three years. This will represent a very difficult time for Greece, much as it represents a difficult time for Ireland. We know it will require a large downward adjustment of the debt to GDP ratio in Greece from 2013 onwards. Greece will be required to keep primary balances in surplus to at least 5% until 2020. It will involve a cut in Greece's public sector wage bill and pension outlays, an increase in excise taxes and further increases in VAT. These are very similar to the measures we have seen in our budgetary and fiscal adjustment. These budgetary issues have stretched across Europe to reach many member states. There is hardly one country in or outside the eurozone that is not having to make substantial adjustments in its budgetary position.

I welcome the establishment of a European financial stabilisation mechanism, which represents an early scrutiny of the budgetary cycle. It was referred to by the Minister of State and it is very important. Some people made the point that it might represent a loss of sovereignty as the European Commission and perhaps the European Parliament would be involved in internal budgetary matters. What use is sovereignty if one is bankrupt? What use is sovereignty if people are going to be rioting on the streets and discommoded? It was implicit in the single currency that governments would stick to their proposed maximum 3% budget deficit per year. It is a sorry state of affairs that the opposite has come to pass in Ireland. The Irish Government ran substantial surpluses for most of the early years of this decade. We were not running deficits. There was a surplus of €2.1 billion in 2004, €1.9 billion in 2005, €5.3 billion in 2006 and €500 million in 2007. We had a collapse in tax revenues in 2008 and there was a deficit of €13 billion, while there was a €19 billion deficit in 2009. The point I am making is that in the good times, unlike in other countries, we were actually running budget surpluses and so were strictly adhering to the EU criteria.

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