Martin Mansergh (Tipperary South, Fianna Fail)

I thank the main parties in Opposition for their support for this legislation in the House for what has been an interesting debate on what is undoubtedly a technical piece of legislation.

To refer to the legislation itself, and I do not want to exaggerate this, and also the follow up on the 2010 agreement, it allows us to shave interest rates. That will only happen from the date those agreements are ratified by a two thirds majority and enter into force. Other than ratifying those agreements ourselves, there is nothing that we as an individual country can do beyond that to hasten when they come into effect but I understand the 2008 agreement will shortly come into effect.

Deputy Burton has a good understanding of how the IMF has evolved. Deputy Higgins evoked the idealism of the founding fathers, just as I heard some of my colleagues in my own party evoke the idealism of the 1920s and 1930s, but social conditions change and obviously the global conditions since 1945 have radically changed as well.

I share the strong criticism of the way the IMF operated in the late 1970s and late 1980s and a great deal of the criticism directed against the insensitivity at that time is justified but the IMF of today is a completely different type of organisation. As has been pointed out already and as I pointed out myself, it is headed by a French socialist, Dominique Strauss-Kahn, who is still mooted as a possible French presidential candidate.

There are many developing countries, and I have not heard any government of a developing country describe the IMF as an odious institution and one that ought to be abolished. Many developing countries would be extremely upset if that were to be mooted because the IMF of today is of real assistance to them. The Sinn Féin Members should get themselves up to date on the culture of the present day IMF.

Deputy Burton made the case for a Minister for Foreign Affairs. When a vacancy occurs the Taoiseach, and indeed any Taoiseach, often takes a Department to himself for a short period. There are two Ministers of State, Deputy Dick Roche, who deals with EU matters, and Deputy Peter Power, who is oriented towards development policy. If necessary, there is myself. I represented the former Minister, Deputy Micheál Martin, at two Foreign Ministers' meetings last May. There are people who can be called upon in that situation.

Deputy Michael D. Higgins raised the question of globalisation and anti-globalisation. For better or worse, and it is probably both although perhaps more for the better, we live in a globalised world. I do not think it is going to be possible to reverse that. It is a question of controlling and regulating matters so that the beneficial effects outweigh the destructive harm that can be done, and that we have seen, for example, in the global financial crisis of the last two and a half years.

The discussion broadened out to EU interest rates. Deputy Noonan referred to relatively lower interest rates being charged on the EU balance of payments facilities for certain eastern European countries. The average interest rate on EU assistance, under the European Financial Stabilisation Mechanism and the European Financial Stability Facility is designed to be similar to IMF lending conditions for developed countries. Following the granting of bilateral loans to Greece and after detailed discussions, member states agreed to the provision of financial assistance under those two schemes on the basis of strong policy conditionality and terms and conditions similar to the IMF. It is not appropriate to make comparisons to the assistance given to non-euro member states, because the balance of payments support was not set up to be the equivalent of IMF conditions.

I follow closely, in the international as well as the Irish press, the ongoing debates that are taking place in the EU, both about the short-term problems facing the euro and the longer-term problems. The Minister for Finance was at a meeting where that subject was addressed earlier this week. There is, perhaps, a tension between attitudes. The underlying motive of eurozone partners is to try to re-establish confidence in the euro and to prevent contagion spreading. There was, certainly, a short-term success vis-À-vis Portugal last week.

I am strongly of the opinion that the terms negotiated last November were those thought by our partners to be most conducive to restoring confidence in the euro. We have moved on two months since then. It is, perhaps, clear that the terms of the agreement have not had, from a euro-wide perspective, the positive impact that might have been hoped at the time. There is a perception, not least from this country, that the terms are onerous, although it has always been the Government's position that they are manageable. This is not to say that if more favourable conditions could be obtained we would not be interested in obtaining them. That debate is ongoing and there is a tension between being fairly rigid at the moment and yet foreseeing a different mechanism three or four years down the line if a similar situation were to occur. One has to be frank about the fact that the EU, and in particular the eurozone, has not yet come to a resolution of these problems. If progress is made from which this country can benefit, whether under this or the next Government, that would be welcome. I would caution against any party thinking or proclaiming to the public, particularly in an electoral context, or holding out the prospect of a major change or alleviation of conditions. I do not, at present anyway, see any prospect of that.

The mechanism is often presented as the result of a bilateral negotiation between Ireland on the one hand and our euro partners on the other. Our euro partners are, obviously, looking all the time at its knock-on effects. Other countries are vulnerable and the long-term consequences of short-term solutions must all be considered.

Of course, the IMF could be made an ultra-democratic institution. However, the country that provides the vast majority of the funds might no longer be interested in doing so if it felt that its influence could be overridden. When one talks about using the UN rather than the IMF model, one must remember that the UN is not a democratic organisation either. There are five permanent members of the Security Council that have a weighted and a veto power quite different from that of other member countries. The EU is, to a degree, different. There are, of course, voting weights in the Council of Ministers so there is also a weighted mechanism there, but the EU is, relatively, as equal and democratic an organisation as it is possible to be. When one has member countries of vastly different size, population and wealth one can only push equality so far. The United States itself consists of some states with very small populations. They are all represented equally in the Senate but by population in the House of Representatives. Balances must be worked out.

On whether one can have basic equality, whereby the smallest country would have the same weight as the United States, China and so on, unfortunately, regardless of whether this would be ideal or otherwise, it certainly is neither realistic nor pragmatic. We must work with the institutions we have. In respect of the World Bank and the IMF, Ireland operates in a constituency that is led by Canada and that consists of several but not all Caribbean countries. Consequently, we have a mix of representation there. Marginal changes are being made in balances to quotas and so on in order that poorer countries are better represented. No country is obliged to belong to the IMF or any other international organisation if it does not wish. However, in the world community as a whole, practically all countries are in it. Countries belong to such organisations because they perceive them to be of benefit to themselves.

Finally, I have no ambition to see this country go down the route of Argentina, Colombia or anywhere else. One should study the consequences of so doing and of not being able to borrow on markets. Ireland still is a wealthy, developed country and we simply must buckle down to adjust to our conditions. The word "hubris" was used and it is a word I would have used myself. We were too ambitious and did not listen to the voices that told us to go more slowly, notably the European Commission in 2001. While we all were highly indignant about its interference in Ireland's internal affairs, I am afraid the European Commission was right and we were wrong as we were going too fast. However, we still have a great deal going for us. If one asks the reason the Government is front-loading the adjustment, it certainly is not for the political advantage of this side of the House because there is absolutely none. It is because most people would like to get through these problems as quickly as possible and head towards recovery, rather than stagnating for long periods, which has been the experience of some other countries with similar problems in other parts of the world. I hope I have responded to most of the points raised.

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