Heather Humphreys (Cavan-Monaghan, Fine Gael)

I welcome this opportunity to speak on the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union. It is very important that we have this full discussion so the misinformation and scaremongering in which some people are engaging is dispelled and put to bed. I heard some of the previous speakers who spoke against the Bill stating we need to spend, spend, spend in order to create employment. As Deputy Donohoe said, show me the money. Where do they think we are going to get this money to spend? They are living in a deluded world - in fact, one could call it Alice, Joe or even Richard in Wonderland. Let us come back to reality.

It is important at the outset to define stability. Stability can be defined as firmness in position or the strength to stand and endure. We all recognise stability as a good thing. It is something everybody is looking for in this life - in their work, their family life and their relationships. How often have we been told that children need a stable home to flourish and thrive? Stability brings balance and harmony to our everyday lives. When we build a house, we always look for a stable foundation because, without it, we will have no base and eventually the house will fall. Therefore, we all agree that stability is a good thing in all aspects of our life and, in turn, we need stability as a nation.

Through austerity measures, a lot of weight and burden has been placed on the Irish people but, unfortunately, we need austerity for the sake of stability. More than ever, we need stability to move on. The stability of the economy encourages investment and we need investment to allow us to recover and regain our economic sovereignty.

The treaty reinforces existing EU rules to require EU Governments to live within their means by cutting excessive deficits and debt. The stability treaty requires us to put a set of rules in place that states Government budgets should be balanced or in surplus, with any structural deficit set at a lower limit of 0.5% of GDP. The idea is that if we run budget surpluses during periods when the economy is strong, we can afford to support the economy by running deficits when the economy is weak. Averaged out over an economic cycle, Government budgets should, therefore, be broadly balanced. This is good for economic stability and long-term growth. It means that when the economy is weak, Government supports spending in the economy by borrowing and, when the economy grows strongly, Government takes money out of the economy to repay public debt. This makes sense because it is basically good housekeeping rules.

The treaty also allows countries to breach the deficit rules during exceptional circumstances and borrow more heavily to protect employment through stimulus packages. An example of this would have been the foot and mouth crisis some years ago, where such a treaty would have allowed Ireland to break the borrowing rules to protect the economy.

As well as cutting excessive annual deficits, the treaty also reinforces existing EU rules that require countries to bring their overall public debts down to safe levels, judged as being 60% of GDP. Economic research shows that debt levels significantly in excess of this benchmark are bad for jobs and economic growth. It is important to note that countries with debt levels in excess of the 60% target, such as Ireland, will have 20 years to bring their debts down to the target level. On the other hand, good budget rules give investors confidence about the future. High public debt levels will increase the perceptions of risk around Ireland, making credit more expensive for businesses and job creators, and increasing interest rates for home owners.

Would anyone invest in a business that did not have a clear set of rules within which it operates? One of the first things a person would look at is the business's memorandum and articles of association and its audited accounts. This is the same for investors in Ireland Inc. We must have a clear set of operating principles which we adhere to and we need to demonstrate that we act in a responsible manner.

There is a strong link between the stability treaty and the European Stability Mechanism. If we do not ratify the treaty, we will not have access to the ESM. We do not plan to need this fund but it is like an insurance policy - you might never need it but it is there when you want it. Having this protection will make us a much more attractive destination for international investment. However, if we do not ratify the treaty, markets will become much tougher and all of the progress we have made to date could be put in jeopardy. There have been several positive job announcements recently, including the announcement of 1,000 jobs in PayPal in Dundalk which will have positive benefits for parts of my constituency in Cavan and Monaghan. Ireland would not have won these jobs were we not a part of Europe and the eurozone. The current unemployment crisis would have been far worse had we turned our backs on Europe.

The agriculture and agrifood sectors are the backbone of our economy. They account for 300,000 jobs and are playing a vital role in our economic recovery. It is well recognised that our agriculture and agrifood industry needs Europe. I commend the IFA on clearly stating its support for the treaty. The IFA President, John Bryan, stated that any withdrawal by Ireland from a central role in Europe would have negative consequences in the short term and could potentially lead to Ireland's isolation in the longer term. Members of the IFA executive council decided unanimously that it would be in the best interests of Irish families, the business community, including the agrifood sector, exports and jobs to vote "Yes" on 31 May. Successful CAP negotiations in the coming 12 to 18 months will be vital to Irish agriculture and the IFA president has said, "Influence and goodwill in Europe are necessary conditions to ensure the best outcome in these crucial negotiations". I support the motion and earnestly call on people to vote "Yes" on 31 May.

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