Pat Breen (Clare, Fine Gael) | Oireachtas source

They are running for cover.

This Bill ensures that the debt rules contained in Articles 3 and 4 of the Treaty on Stability in the Economic and Monetary Union are given effect and that the Irish Fiscal Advisory Council is established on a statutory basis. As the Minister for Finance, Deputy Noonan, stated in the House on Tuesday last, when he moved Second Stage of this Bill: "This Bíll will allow us to ratify the stability treaty, in line with our fellow euro area member states, which is in the interests of this country and the euro area ". The Minister is continuing his journey all over the the European circuit, pressing the case for Ireland. Today, tomorrow and at the weekend he is at a World Bank annual general meeting in Japan. He is encouraging his euro colleagues to firm up details of the decisions which were taken last June at the EU summit to split Ireland's banking and sovereign debt. The President of the European Parliament, Martin Schulz, addressed a packed House last week. The ECB President, the EU Commission and the President of the European Council, Hermann von Rompuy, have all stood by the agreement of 29 June, which in itself is significant. Much has been said about the statement by the "gang of three" Finance Ministers that the ESM will not apply to legacy bank debts. I suspect, however, those comments are just their opening negotiating positions. We all know from our experience in Europe that unanimous agreement is very often achieved in cases where countries started out being diametrically opposed and I believe that will happen on this occasion as well. I have every confidence that the Minister for Finance and the Taoiseach will keep the EU 27 to the deal agreed in June.

The legacy of the collapse of Anglo Irish Bank and the issue of the promissory note continue to pose challenges for this country. A further payment of €3 billion is due in March. Recent comments by the Minister, Deputy Noonan, show he is anxious to have at least an indication before December's budget from the EU of its intent in dealinq with the Anglo Irish Bank promissory note so that he has all the information he needs when he sits down to frame the budget. However, even if there is a breakthrough before then there is no getting away from the fact that this budget will be the most challenging in our history. There is no easy way to plug a deficit of €3.5 billion.

I have argued in the past, as have many other Deputies on this side of the House, that we should be budgeting for a number of years in advance. That would do away with much of the kite-flying that has become a norm at this time of the year. The domino effect of the collapse of our economy and the onslaught of the global recession, which have created EU-wide uncertainty, have reinforced the need for fiscal rectitude and proper planning. At the start of the recession Europe had been struggling to get to grips with this crisis. Its response was to establish a treaty on stability and establish the European Stability Mechanism, which have steadied the ship. Ireland had already signed up to tighter fiscal rules in in the Maastricht Treaty in 1992 and the Stability and Growth Pact in 1997. It is clear these rules failed, however, because countries did not adhere to them. As a result, ordinary people are now paying a very high price.

The austerity measures forced on us because of our bailout arrangement have been painful and have had a considerable impact on our people. Notwithstanding, a glimmer of hope is emerging. The latest quarterly report from the ESRI shows that output grew last year for the first time in four years, expanding by 1.4% in GDP terms. The IMF's latest outlook paints a similar picture. I wish the Minister well in his deliberations in Japan where he will meet all the important players. He has a close political relationship with Christine Lagarde. I believe he will come home well equipped to prepare the budget and consider the outlook for the future.

The IMF report states that the Irish economy will grow by 0.4% this year and by another 1.4% next year, which is the best outlook for any EU country in a bailout. Take the Greek economy, for example, which is predicted to slump by 6%, or the Portuguese economy, predicted to slow by 3%, with similar predictions of slowdowns in ltaly and Spain by 2.3% and 1.5%, respectively. The same IMF outlook predicts there will be a modest pick-up in the global economy next year, with the emerging countries growing at four times the rate of the so called advanced economies. The saying is that a rising tide lifts all boats and this is very true of the global economy. While green shoots are beginning to emerge in this country, without a global lift in the economic tide recovery here will be held back. That is why it is extremely important for Europe to get its act together. Both the ESRI and IMF concur that Ireland's recovery will be limited if the global situation does not change. The IMF has warned European policy makers they must deepen financial and fiscal ties within the eurozone given that its debt crisis is the main threat to global financial stability. José Viñals, the director of the IMF stated: "The choice today is between making the necessary but tough policy and political decisions, or delaying them - once more - in the false hope that time is on our side."

Given that Irish people have already endured four years of austerity, time is of the essence. If, as already stated, Ireland is to move ahead, then a strong eurozone will be required. It is not, as many of those on the Opposition benches have stated, all doom and gloom in the context of Ireland's future. Our international credibility is at an all-time high and there is international recognition for our Government's work in restoring the economy. I am Chairman of the Joint Committee on Foreign Affairs and Trade and I am obliged to travel as part of my job. I meet politicians from various countries and they indicate their respect for Ireland in the context of what has been done here in the past 12 to 18 months. They also respect the confidence the Government has engendered. One need only consider the work the Government has been doing in order to restore the economy. The Taoiseach's photograph appeared on the front cover of Timemagazine last week under the headline "The Celtic Comeback". This is a testament to the positive image Ireland is attracting globally.

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