Seán Ó Fearghaíl (Kildare South, Fianna Fail)

Is maith an rud é go bhfuil an Tánaiste agus an t-Aire Stáit anseo mar go bhfuil sé fíor-thábhachtach, i gcomhthéacs an fheachtas atá os ár gcomhair amach, go mbéadh comhoibriú, de chineál nach raibh ann ariamh, idir an Lucht Oibre, Fine Gael agus Fianna Fáil i gcomhthéacs an reifrinn fhíor-thábhachtaigh seo. Ba mhaith liom a gheallúint go mbeidh Fianna Fáil ag gníomhú go fuinniúil sa bhfeachtas atá os ár gcomhair amach agus táimid ag tnúth le comhoibriú iomlán a dhéanamh leis an Lucht Oibre agus le Fine Gael sa bhfeachtas.

On behalf of Fianna Fáil I welcome the Bill before the House today. As well as supporting its passage through the House, we will be campaigning for a "Yes" vote in the forthcoming referendum. We do so as the party which brought Ireland into membership of what is now the European Union, supported the reform and development of the Union through the years and remains absolutely committed to the idea of nations working together to overcome common problems. As we said repeatedly before the Government eventually agreed to hold a referendum, if this treaty is a significant one - if it represents a significant step towards resolving the European debt crisis - then it is right that the people be consulted. Ours was the first party to call for a referendum and the only pro-EU party to do so before the Attorney General told her colleagues there was no alternative. While we are strongly supportive of this Bill, we are not uncritical of the treaty's limitations and the poor way in which it is being handled.

People are rightly suspicious of arguments for treaties which are based solely on past achievements rather than future prospects. However, understanding the need for this treaty requires an appreciation of why helping the European Union to address key failings is in our national interest. Equally, it is necessary to counteract the arguments of those who try to dismiss and demonise the Union, failing ever to acknowledge its profoundly positive record in this country. Even at this moment of deep crisis, the Union's record remains one of having enabled relative prosperity and peace that would have been impossible otherwise. No other economic, social or political model could have come close to enabling Europe to conquer the types of poverty and violence which previously defined its history. Only five years before the Coal and Steel Community was established, thus launching the European project, the Continent experienced a deep and severe subsistence crisis, with widespread grinding poverty and simmering conflict. Ours is a pro-EU party because we recognise this record of profound progress and because the Union provides the only credible context in which a small, peripheral country such as Ireland can succeed.

Many people are suffering today because of the impact of the recession. Unemployment is far too high and living standards are under pressure. However, we must remember the simple fact that both living standards and employment rates remain significantly higher than they would be if Ireland were outside the Union or the euro. Membership gives security to those seeking to invest and opportunity to those who want to export. Hundreds of thousands of jobs are in this country because of our membership of and record in the European Union. Let us not forget that the Union remains an immense force for good in areas such as equality, education and working conditions. People can summon up all of their ideological fury to condemn the Union as some elite conspiracy to do down ordinary people, but the reality is that it has done more for the people of Ireland and Europe than any left or right-wing ideology. We have not seen our people conscripted into a European army. We have not become a nuclear state. We have remained in control of key national policies. The rights of ordinary people have been dramatically strengthened. Not one credible piece of evidence has been produced to suggest that Ireland could have achieved current living standards and employment levels outside the EU. The Union's relentless opponents have spent 40 years failing to acknowledge the clear and unambiguous progress it has enabled. Until they are willing to present a more balanced picture they will continue to be more interested in promoting only their own interests. All of the evidence is that it is in Ireland's vital national interest that the Union be strong and successful. This is the core sentiment we must bear in mind in this debate.

The treaty cannot be separated from the context in which it was proposed, namely, the deepest recession experienced in Europe since the Second World War. The mounting crisis in 2008 to 2010 saw the Union completely failing to engage. It continued to seek to work within pre-crisis policies and the idea developed that the troubles being faced by individual countries were fully their own responsibility. This is the approach which led to unreasonable requirements on Ireland concerning bank debts. It also was the approach which caused the Irish and Portuguese bailouts to be required. The insistence that existing rules would remain unchanged undermined confidence and led to the situation nearly spiralling out of control last year. It is increasingly clear that the Irish bailout would not have been required had the policies in place today been there in 2009 and 2010. The ECB's support of the financial system would have directly countered the panic which forced the taking on of unreasonable levels and types of bank debt. A more secure financial system and the existence of bailout funding would have directly reduced pressures and the dramatic increases in borrowing costs. The narrative that all problems have had as their cause the failures of individual countries was deeply wrong and it is long past time for it to be corrected.

Last year's series of emergency summits and last-minute deals escalated the sense of crisis and directly damaged economic confidence. The mid-year deal for Greece, which was extended automatically to all current and potential countries accessing bailout funding, was only ever a stop-gap solution. While the Government was busy praising itself for getting a deal which it did not negotiate and was four times what it had asked for, others began to discuss longer-term measures. The Tánaiste will recall that in August, it became clear there would be flexibility on providing additional funding for support programmes but only if the legal basis for fiscal control was strengthened significantly. The process by which this treaty was developed was easily the worst for any treaty between European states in the last 50 years. It was rushed, there was a lack of proper debate and no effort was made to achieve unanimity, even though the final text is overwhelmingly based on already agreed policies. Through this process, the only stated negotiating objective of the Irish Government was for something good to come out and that treaty changes should be avoided if at all possible. As a result of this flawed process, the treaty Members are debating today is important but not nearly comprehensive or ambitious enough. It is part of the answer to Europe's crisis but nowhere near the full answer, as the Tánaiste indicated in his contribution.

This is the first time any Government has brought a proposal for a European treaty to the Dáil without first publishing a White Paper. Past White Papers have served as a definitive statement of each treaty's implications in an Irish context. While they may have been read by relatively few people - even some politicians may not have read them - they have provided an essential foundation for debate. As far as Fianna Fáil has been able to ascertain, during the five months since leaders agreed the main provisions of this treaty, the Government has neither sought nor published a single piece of analysis of its understanding of the detailed provisions of the treaty. The ridiculous situation obtains in which the Government states it has been advised that a constitutional amendment is required to ratify the treaty but has not explained the reasoning for this requirement. No detail has been provided to the Dáil or to the public as to what is perceived as so significant in this treaty that a vote is being held against the Government's clearly and repeatedly expressed earlier views. The Bill's explanatory memorandum is a one-page effort, which simply states a referendum is required for ratification but nothing else. This is a very bad start to a serious debate about a measure that is an important part of the wider agenda of restoring growth and job creation to Ireland and Europe. In effect the Government has ignored its duty under Standing Orders and precedent to provide Members of the Oireachtas with briefing sufficient to ensure a fully informed debate.

I acknowledge the ongoing and valuable hearings of the Sub-Committee of the Joint Committee on European Affairs on the Referendum on the Intergovernmental Treaty to which Members have alluded. However, given that Members are holding this debate before it has finished taking evidence or even begun drafting a report, the Government clearly is not overly concerned with paying more than lip service to its work. Thankfully, the gap left by the Government has been filled by independent experts, who have been active in providing detailed analyses of the economic and legal implications of the treaty. Their work, most of which has been published, provides a solid independent basis for considering the treaty and reaching an opinion on it. As I stated previously, Fianna Fáil's position from last year has been that any European treaty should be brought to a referendum, irrespective of whether a legal loophole to avoid a vote could be found. The effort to avoid one would have been legally risky and would cause lasting damage to pro-Europe sentiment. It would have made it close to impossible to go back to the people with the more significant changes which are desperately needed and which will come in time.

After the final text emerged, Fianna Fáil sought independent legal advice as to the exact significance of what had been agreed. Although it is a lengthy piece of advice, it can be summarised. While the treaty involves little that is new in policy terms, it does have significant implication in terms of the legal standing of fiscal rules. The treaty significantly strengthens rules which for the most part already are part of European law and ratified by this and other countries. This is, of course, its primary purpose in terms of the restoration of confidence in fiscal management within the eurozone. In terms of the form of ratification, the relationship between national and international law is not the same in every country. The only way in which the Oireachtas could safely ratify certain of the commitments in this treaty is through a constitutional amendment. This is particularly true of the requirement that the fiscal rules not be open to easy amendment within national parliaments. The fact that this is an intergovernmental treaty between EU member states rather than a full EU treaty is legally extremely significant. It clearly deprives certain elements of the treaty of the protection from challenge afforded by previous amendments. At an EU level, there remains a question as to whether the institutions can play all of the roles ascribed to them in the treaty but this is not a matter Members can discuss at this point. While the comments last December by British Prime Minister Cameron to the effect that the other member states could meet but could not use those institutions may not have been helpful, there is little doubt that someone will take a case on this issue. It has been reported that a Member of this House is to take a legal challenge to the European Stability Mechanism, ESM, treaty. Fianna Fáil does not believe this will succeed and the people of this country should earnestly hope it does not. It manifestly does not come within the terms of the Crotty judgment, as it imposes no limitations on the free exercise of the powers ascribed to different institutions by the Constitution. Instead, it provides a mechanism in which others are willing to give countries much needed funding. The willingness of governments to stretch the competencies of the Union to include providing loans to member states has been an extremely welcome development. The ESM treaty is one that Ireland should wish to ratify and see operational as soon as possible, hopefully with a much larger amount of money available to it.

Over the last 12 months, Fianna Fáil has repeatedly raised European issues in this House. Its concern has been to push for actions which are ambitious enough to tackle the crisis. Fianna Fáil's leader has set out a detailed position on the specific measures which the party believes should be promoted. Its basic position is it will support any measures which can genuinely contribute to achieving two overriding objectives, namely, saving the euro while returning the eurozone to the path of growth and stability and protecting the democratic legitimacy of the European Union. Fianna Fáil believes the future relationship between Ireland and the European Union must be fundamentally based on supporting measures to achieve these objectives and the party has assessed its position on the fiscal treaty in the context of these objectives. As for the euro, it is important to state it is under pressure but is worth saving. The positive case for Ireland is that it has directly enabled incredible growth in employment in many areas. It has aided increased exports of between 30% and 60% to different global regions. Moreover, these jobs have actually been the most secure in the recession and form part of the strongest parts of our economy. The negative case is the adjustment which would be required were Ireland to leave the euro would be much more dramatic and severe than even the tough adjustments under way at present. Ireland would face higher borrowing costs, a much worse business climate and a direct danger to employment in major parts of the economy.

In respect of democratic legitimacy, while the holding of a referendum is vital, so too is the fact that nothing is being proposed that undermines the accountability of the Union and its member states to their citizens. In fact, the co-operation and transparency provisions of the treaty enhance accountability. Fundamentally the eurozone actually is economically strong. The problem is it has failed to address three core design flaws in monetary union. First, the mandate and powers of the European Central Bank, ECB, are too narrow. Second, it needs a unified system of bank regulation and a single resolution regime. Third, it needs a more substantial fiscal union, particularly strong fiscal rules and increased funding for investment and I note this treaty delivers an important part of this third point.

Sharing a single currency directly limits each participant's ability to act by itself. Co-ordination and agreed controls are an absolutely essential part of not only a currency union but also of long-term shared growth. The fiscal rules authorised in the Maastricht treaty and finalised by the Council during Ireland's 1996 Presidency, lack all credibility. These were repeatedly flouted when it was not necessary to do so and a convincing case developed that a much stronger legal basis was required in order to regain confidence that they will be implemented. The six pack measures, which were agreed in 2010 and which are now in operation, give much greater depth and substance to the fiscal rules. They have introduced a new level of transparency and oversight, which makes the type of manipulation of debt and deficit figures practised by some countries in the past almost impossible. They have also helped restore some confidence among investors. The most pressing need is to ensure these measures cannot be undermined for short-term reasons. This is the core of the treaty. It is a reasonable and proportionate demand, particularly in light of the experience of the past decade and a half.

In respect of how the fiscal rules are presented, the Government needs to watch its tendency to over-spin and over-politicise everything. It is simply wrong to claim that Ireland would have avoided a profound recession if these rules had been in place. The details of the Government parties' economic analyses and projections in 2002 and 2007 show that they believed Ireland had a strong structural surplus and a secure growth rate of 5% per annum.

The main attack on the treaty is that it somehow entrenches permanent austerity here and throughout Europe. No matter how much the slogan "austerity treaty" is trotted out, it will still not be true. For this attack to be credible, we would have to see an alternative whereby there would be more money available to be spent on public services and to avoid tax increases. No such scenario has been provided. In fact, the accumulating evidence is that this treaty represents the road of the least austerity. That is a point which must be emphasised. The treaty will reduce the interest rate we are obliged to pay to borrow money in order to fund the deficit and refinance debt. If it does so to a comparatively modest rate of 1% over the medium term, this will represent a net saving to the State of over €1 billion per year.

The challenge to the opponents of the treaty is that they should put aside their sloganeering and show the people some basic respect by setting out the detail of their alternative. In other words, they should "show us the beef". From where do they propose we should borrow money and how can the reduced interest rates which will emanate from the treaty be matched elsewhere?

It is also being argued that the treaty ends the ability of the State to invest in growth. This is also not true. There are many routes to funding growth available. The only thing that is ruled out is the use of a structural deficit to do so other than in times of deep recession. The latter is no more than common sense. Is there anyone who can credibly claim that Ireland needs the power to run unsustainable levels of borrowing during good times? That is effectively all that is being prohibited in the treaty.

The treaty will have one specific and immediate benefit in that ratification will qualify Ireland for future access to the European Stability Mechanism, ESM. In the absence of a central bank which acts as the lender of last resort, the ESM is now the essential enabler of market access at affordable interest rates. The ESM is the most important development of the past year and a half and its absence in the early stages of the crisis caused real difficulties. Opponents have been stating that this is effectively a blackmail clause. In reality, what it involves is a demand that countries respect common rules if they want access to common funds. It would be at best arrogant for any country to turn to the rest of Europe and say "We want your money but we will set our own rules". We believe the official German position on treaty changes is too rigid and is causing significant damage. However, the demand that the fiscal treaty be ratified before accessing ESM funding is perfectly reasonable and proportionate.

The treaty includes a number of provisions relating to the co-ordination of policy and greater oversight. Few of these are novel and all are reasonable. They in no way challenge the basic construction of powers between states and the Union. There is a serious issue with regard to the manner in which the special council for eurozone leaders has been developing. Its dynamic is poor and its agenda is far too selective. The failure of countries such as Ireland to speak out against the highly destructive and insulting behaviour of some leaders is a very bad start to what will now be a regular series of intergovernmental meetings.

After December's summit, the Taoiseach announced that there had been no discussion of corporate tax issues even though the communiqué explicitly stated that it had been agreed to proceed to harmonisation through enhanced co-operation. Others have begun sabre-rattling with regard to the introduction of a financial transactions tax within the eurozone. These are red-line issues in respect of which this country can never succumb and no one should be in doubt that this referendum confers no legitimacy on the harmonisation agenda.

My party will continue to support actively the ratification of the treaty. We have held our position on the treaty despite the Government's behaviour last year in the context of bringing a new level of petty political partisanship into European matters. This was most clearly shown by the failure to respect the tradition of consultation among the pro-European mainstream until the referendum became inevitable. The almost 400,000 people who voted for Fianna Fáil in the most recent general election are an essential part of the potential majority that will be required to pass the referendum. As matters stand, opinion polls show that over 75% of Fianna Fáil voters are in favour of the treaty. That is a level of support which is far higher than that which exists among Labour voters.

We will campaign on a positive message which emphasises the importance of the treaty as part of a wider agenda. We will continue to push actively for Ireland to be more active in calling for vital measures such as the fundamental reform of the mandate and policies of the ECB. At a time of great difficulty, we believe the people of Ireland and Europe are dissatisfied with the timidity and failures of Europe's leaders but that the Union remains a focus of their hopes for the future. They understand that a return to growth and job creation requires a central role for a more active and powerful European Union and this is what lies behind the high levels of support currently being seen in the opinion polls. Regardless of how the Tánaiste tries to spins matters, it is obvious that the campaign is being rushed because of these polls. This may not affect the outcome - hopefully that will prove to be the case - but it undeniably increases the risks involved. It goes directly against the recommendations of researchers and the Referendum Commission and breaks another promise of the Government, namely, that more time would be provided in respect of preparation for the holding of referenda.

The date that has been chosen for the referendum also gives rise to a substantial risk that the future of the treaty will be in doubt as a result of developments elsewhere. The Tánaiste is wrong when he says there is a growth agenda which can satisfy Francois Hollande's demands. We know where the latter stands in the opinion polls in his country at present. Mr. Hollande has clearly stated he will not ratify the treaty until growth issues, such as the ECB mandate, are addressed. His election to power - if it happens - may not overturn our vote but it would introduce unnecessary risk.

The treaty cannot be the end of reforms to address the economic crisis. It must be a starting point, a foundation for forcing more important measures onto the agenda. It is a necessary and reasonable mechanism which will reduce the costs of borrowing to fund public services in this State. It is not a major innovation but is rather a confidence-building measure at a time when such confidence is urgently required. My party strongly supports the Bill before the House, particularly because it will enable a referendum to be held. We will be campaigning for a "Yes" vote, based on positive arguments and a belief that working with a stronger Europe is the best route back to growth and job creation.

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