Seán Ó Fearghaíl (Kildare South, Fianna Fail)

Ba mhaith liom buíochas a ghabháil leis an Rialtas as ucht an díospóireacht tábhachtach seo a bheith againn inniu. I wish to reflect the sentiments expressed by Deputy Ross in respect of the initiative taken on the advice given by the Attorney General, Ms Máire Whelan, who has done the State some service.

Yesterday at 3 o'clock, the eyes of Europe once more turned towards Ireland. Supported by the enduring strengths of our Constitution, the people, despite Government efforts to avoid it, have finally been given the opportunity to give their opinion on the future direction of the EU. It is a chance for the people to affirm our role in a Union that has transformed a war-torn continent onto the most peaceful and prosperous community in the globe. As it has since we guided Ireland into the European Economic Community in 1973, Fianna Fáil will support efforts to move Ireland and the European project forward.

Since the agreement of the outline of the fiscal compact in December, Fianna Fáil has consistently called for a referendum to be held. The democratic deficit that is gnawing away at the heart of Europe cannot be ignored despite desperate and ultimately failed Government attempts to avoid a referendum, which have weakened our position in the eyes of the electorate and our EU partners.

We will vote in favour of the treaty as a step towards facing up to the fundamental challenges facing the eurozone. However, we believe it does not go far enough and that the ECB's role needs to be reformed, fiscal union needs to be established and pan-European banking regulation needs to be set out. The fundamental design flaws of the euro need to be addressed in order to get Europe's and Ireland's economies moving again. Our policy of constructive engagement with Europe has benefited Ireland immensely and will continue to do so into the future. The benefits of free trade, infrastructural investment and unprecedented movement across the Continent are central parts of Irish people's lives today. The greatest assertion of Irish independence from Britain was the day we joined the EEC and broke the cords of economic reliance on the UK that had bound the country since 1922. Those who cynically play the nationalist card in the upcoming referendum should recall that independence is more than mere slogans.

Our engagement with the EU is founded on shared values of solidarity, human rights and democracy. It is an engagement that involves - like any good friend - criticism where necessary. We are profoundly critical of the limits of the fiscal compact, which is just one step in a far longer journey in addressing the crisis we all face. However, as the proverb goes, every journey starts with a single step and we will not indulge in cruel populism, demagoguery and snake-oil salesman solutions to problems that demand honest action. The responsibility that falls on us as public representatives deserves more than that.

It is important for us to consider the context of the treaty, its details and the potential future repercussions on Ireland. The European project stands at a crossroads. Internally, it is assailed by a currency crisis, a stagnant economy and rising unemployment. Externally, it faces a volatile globe with rising economic powers which threaten to sideline it and condemn Europe to increasing irrelevance. Europe needs to take decisive choices on what direction to take in order to address these problems. This treaty is just a step towards the decisive action necessary. The economic future of our country is bound up with the choices the EU as a whole makes in the critical coming months and years. Ultimately, no amount of action plans will solve the unemployment crisis if the broader European macroeconomic situation remains dire. All pathways to work will lead nowhere if the EU continues to lurch from crisis to crisis as it has done.

The 1992 Maastricht treaty created the common currency after years of grave volatility in the markets and an utterly transformed Europe after 1989. It aimed to face up to the dramatic seismic fall of the Berlin Wall and the collapse of the Soviet Bloc that had been a dark shadow over the free Europe since the end of the Second World War. It was envisaged by Jacques Delors, Helmut Kohl and François Mitterrand as a core part of a new framework for a new Europe. However, from the inception of currency, it suffered from fundamental design flaws. Monetary union requires fiscal union. The Stability and Growth Pact of 1996, which aimed to establish rules to co-ordinate budgetary policies across the common currency area, was wholly inadequate in this regard. The fiscal compact treaty on which we will vote on coming months is basically a ramped-up version of the Stability and Growth Pact from 16 years ago, which built on the Maastricht treaty of 20 years earlier. After the Stability and Growth Pact was consistently breached by Germany and France, it was clear that it needed stronger enforcement rules. More recently the economic governance six-pack passed by the Council and European Parliament took steps towards this in December. The fiscal compact treaty is not a radical departure or a shocking loss of sovereignty. It is not the quantum leap required to solve the crisis at hand. Essentially, the treaty attempts to reduce the chances of poor fiscal policy in one country affecting another country. The rules, as well as budgetary oversight, co-ordination and multi-year budgeting, are in place to enshrine such good fiscal policy by making imprudent fiscal policies harder to enact. The compact is an international treaty outside of the EU treaty framework. It will enter into force following ratification by at least 12 euro area member states. It is open to these countries and to EU countries currently not members of the EU area alike. Unlike the Lisbon or Nice treaties, it does not require agreement of all EU member states, including Ireland, to go ahead. Ireland now has a choice not a veto on whether it wishes to move forward with our EU partners.

Fianna Fáil does not believe in a two-speed Europe and considers the United Kingdom's decision to step outside this treaty with grave concern. The unity and solidarity of the EU across all member states is vital to its future success. Verification of the treaty is required to qualify for the European Stability Mechanism which replaces our current funding arrangements under the European Financial Stability Facility, EFSF, in January 2013. The ESM is the permanent funding mechanism designed to stave off future sovereign debt crises. If Ireland decides to vote against this referendum and we are unable to return to the sovereign debt markets after the end of the EFSF, we will not be eligible of the ESM. A "No" vote would be a self-fulfilling prophesy in preventing a return to the markets. The bond markets will inevitably react harshly to the removal of the security net of the ESM.

Fianna Fáil has set out clear views on what action must be taken to get the European and Irish economies moving again. The treaty is not enough to solve the eurozone crisis. It is one step towards a comprehensive set of policies. An overhaul of the eurozone design framework is needed to address the fundamental problems facing the eurozone. The three main problems are the limited mandate of the European Central Bank; the lack of uniform financial regulation, including a pan-European bank resolution regime; and the lack of a more ambitious fiscal union, in particular one which involves transfers between member states. Dr. Alan Ahearne correctly describes the treaty as an indispensable bridge to the policies necessary to confront the crisis. Creating a framework to co-ordinate fiscal policy in countries sharing the euro currency allows for greater macroeconomic policy efforts throughout the eurozone.

Ultimately, a combination of fiscal and monetary measures is required to tackle the crisis by attacking the basic design flaws in the euro. Fiscal union is the only real solution to the crisis as well as generating economic growth and job creation. Without financial transfers the dominance of Germany and other northern European countries would be copper-fastened and the union would be placed under immense pressure because weaker countries cannot devalue their currencies to compensate. Fiscal union with eurobonds that pool sovereign debt will strengthen all member states' economic performance.

The ECB's mandate should be reformed to a model similar to the US Federal Reserve in which the ECB can expand monetary policy by buying debt from member states. Strong unified financial regulation throughout the union, reflecting the reality of international finance under the remit of the ECB, will be vital to ensure the banking crisis that we have endured does not recur. These changes are necessary to put the euro on a solid footing and secure the future of the European Union in a rapidly changing world.

The Government has wasted immense energy and political credibility in its attempts to avoid a referendum. In the eyes of the electorate, it is seen to be running away from going to the people on a difficult topic and to only grudgingly accepting a referendum now on foot of legal advice. In the eyes of our EU partners, the efforts to accommodate a Government that consistently emphasised the need to avoid a referendum have been utterly useless. No doubt a sense of shock and surprise spread throughout the corridors of Brussels yesterday evening. When the Tánaiste commented last July to the Institute of International and European Affairs, IIEA, about how the Government was determined to re-build our relationships and restore our standing within the European Union, did he mean haranguing other governments into changing the treaty to avoid votes, only to find out that, ultimately, it had to hold a referendum anyway?

Since the agreement of the outlines of the treaty in December 2011 Fianna Fáil has called for a referendum. We believe that without democratic legitimacy the steps necessary towards addressing the critical problems of the Union will be doomed to failure. The people must be consulted and the democratic values upon which the Union was founded should always be at the heart of major policy decisions. In the long term, the European project cannot survive if ordinary citizens do not have an active role in shaping its future. After the initial defeat of the Lisbon treaty in 2008, significant pressure was placed on the Government to press ahead with other routes to advance the treaty without another referendum. That was the wrong route to take. Hiding from the people in the ivory towers of Merrion Street or the Berlaymont building is no way for democratic states to work together. We took the right route and held another campaign. We made an effort to engage constructively with the people and ensure that the views of the people guided our way forward. The Government of the day should never avoid the people as any short-term gain is always at the greatest of long-term costs.

I regret the attitude taken by Cabinet Ministers towards the referendum. The views expressed by the Minister for Transport, Tourism and Sport, Deputy Varadkar, that a referendum would not be very democratic or that it would turn into a referendum on extraneous issues do not represent the sort of positive open engagement that this campaign needs to win. The people will not be impressed by a half-hearted Government forced into a referendum fighting a rear-guard action. The Government must transform its negative attitude towards referendums, a core part of Irish democracy, and run an campaign of open engagement easily accessible information and positive but not uncritical EU participation.

Just as we call for a referendum to allow the people a choice, we also call for a campaign that is not dominated by fear mongering on one side and charlatanism and conspiracies on the other. Europe is more than a "Goldman Sachs conspiracy", as my good friend, Deputy MacLochlainn, has stated previously. His party, which claims to be pro-European, has voted against every European treaty since 1972. The people deserve honesty on all sides in this debate and not self-serving clinical political points with no real interest in solutions.

This is a high stakes referendum for Ireland which will have profound repercussions economically and politically. More important, it is also a chance at this juncture in history for a country on the geographical fringes of Europe to once more affirm its role as part of an unprecedented political community, a community which has turned a Continent ravaged by genocide and conflict between rival states into a transnational organisation unrivalled anywhere in the world and one that has allowed Ireland to break free from our historic reliance on the United Kingdom and drive on immense social and economic progress. Fianna Fáil will argue for a "Yes" vote as a step towards the actions we need to take to provide financial stability and establish a framework for jobs. We will argue for a "Yes" vote for our continued role at the heart of Europe. As is right and proper, the people will have the final say on whether we move forward on this treaty. I look forward to engaging them in the coming months.

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