Shane Ross (Dublin South, Independent) | Oireachtas source

In defence of my colleague, I am not sure his activities in Bulgaria and the Eastern Bloc were particularly multiple and indeed I think he was probably too young to be involved at that time.

It is indicative of the European attitude to us and the problem we have here that there is so little criticism of Bills of this sort in this House. That is not the Deputy's fault, but the reality is that the Opposition here is to some extent emasculated by virtue of the fact that the main Opposition party negotiated many of the deals to which we refer today and the Government is equally emasculated by having acquiesced in these deals after its parties claimed they would do the opposite when they were out of power. If Europe looks at proceedings in the Dáil today, it will not regard the Bill as being threatened or under any serious political analysis because there is such an extraordinary consensus in this House about the willingness of Members of this House to rubberstamp whatever comes from Europe. That is the unhealthy political situation in which we find ourselves. However, ironically it does not strengthen the Government's hand that there are so few elected Deputies who are willing to put a critical mind to legislation of this sort, which might as well have been written - and was indeed written - in the Bundestag. It is a pity we do not have more criticism of this.

We know this Bill will be passed very easily and will cause no concern in Europe. However, we should take the opportunity of Bills of this sort - there have been plenty of them - to play for Ireland and not for Europe. We need to ask not whether it is in the interests of Europe but whether it is in the interests of Ireland. It is time for us to stop taking our scripts from Germany and take our scripts and our lead from the people of Ireland. I was in the City of London the day before yesterday and I got the same reaction as I get throughout Europe when I am there as I am sure other Deputies do. They say, "You guys in Ireland are doing a great job with your economy". While they do not call us the poster boys for austerity, they say they are very pleased with Ireland. What does that mean? It means we are doing what they want us to do. I always suggest they should ask the people of Ireland what they feel about austerity because they do not like it. However, the governments in Europe along with its establishment civil servants - Eurocrats - love us. That is not where we want to be.

I cannot understand the craven attitude of our Ministers, including Labour Party Ministers, when they go to Europe. Instead of implementing a European agenda in the upcoming six months, they should be causing merry hell in Europe and putting Ireland first. They should put Irish demands first on the table, which is not an acceptable policy in Europe, but who cares about that? We are in a desperate situation and need to take radical measures and have radical attitudes.

When one looks at the Bill, one has to ask how in the name of God the Greeks are getting away with this. As the previous speaker said, it has had three bailouts and I predict there will be more to come. Every time the Greeks eyeball the German Chancellor, she blinks. Every time we eyeball the German Chancellor, she pats us on the head and we go off purring. Why can we not take the attitude that we are not a petty people and are not to be trifled with? I do not suggest we go down the Greek road that had extremely ugly street consequences - I do not believe in any of that. However, when it comes to a Bill such as this, we could have not completely disposed of our critical faculties. We could ask why we are giving this to the Greeks and whether Ireland, a bankrupt country, should realistically get involved in bailing out another bankrupt country, which is the purpose of the Bill. I know we have stepped out as a guarantor of some of the debts, but I believe we are still liable for those that were incurred prior to our own bailout. However, that attitude does not seem to occur to the Government. I might address the whole default write-off if I have time later.

I do not understand why I had to read in the newspaper this week that the French Finance Minister had a cosy little meeting our Minister for Public Expenditure and Reform, and Minister for Finance. Out came the French Finance Minister to say France was supporting a banking deal for Ireland - the promissory notes. He was not more specific than that and it is a very easy thing to say - everybody supports a deal for Ireland until it reaches the specifics, but it is the sort of deal that matters. Then some journalist, trying to create mischief, asked him whether the corporation tax was on the table. He said, as a friendly gesture, that corporate tax was not on the table at all. This was to save any embarrassment to Irish Ministers. There was obviously a sigh of relief around the table among Irish Ministers when that was said because it could be sold as something about which we did not need to worry because it was not there.

However, Ireland should have put corporation tax on the table because we forget that tax is still one of our preserves. It is one of the areas where we still have autonomy. What would the French, Germans, Dutch and Austrians, who do not want to give us any deal on the legacy debt, say if we said we were putting corporation tax on the table and announced that we were going to reduce it because we decided that the rate of 12.5% was too high?

What would they say if we said we were going to reduce it in order to undercut what is going on in Europe and attract more multinationals to Ireland, thus creating employment and a buzz in our economy? While I agree that is not something one could easily sell politically to my colleague, Deputy Boyd Barrett, it would certainly make Europe sit up and think. I see no reason we should apologise too loudly or openly about the fact that some of our multinationals are not paying the full 12.5% tax because throughout Europe the headline rate is not adhered to by anybody. There are so many special deals being done under the table it is difficult to work them out. If we were to agree to a reduction and it was to result in the creation of more jobs, economic expansion, growth and exports, what would be wrong with that? It would certainly scare the bejesus out of Ms Merkel, President Hollande and others who are putting pressure on us in this regard. There are no sanctions open to Europe if we stand up for ourselves - this is not a threat but a realistic proposal - on the issue of corporate tax and do not rubber stamp Bills like this when they come before us.

The issue of default has grabbed the attention of those who want to emphasise that there is a radical alternative to the Government's policy. Default is a word that jars with people. Greece has made progress. It has won every battle it fought with Europe by denial, defiance and default. We must be realistic when debating Bills like this, which are models of the sort of limited solutions which come from Europe. In other words, they embody lower interest rates - I think what is provided for is 100 basis points lower - and extended maturities but duck the big issue, namely, a write-off of the debt. This is the issue we must face.

During a recent meeting of the Joint Committee on Finance, Public Expenditure and Reform, Deputies Boyd Barrett, Fleming and others - Deputy Mathews was also at that meeting - asked the Governor of the Central Bank about "write-offs", which is code for "default". The Governor replied first with the same old line, which we have heard again today, that the result would be unpalatable. He could not spell out what would happen because we do not know that. The Governor was then asked the great old canard of what will happen to the ATMs. Despite what we have heard from every Government spokesperson and apologist about the terrifying prospect of default and what would happen to the ATMs, Professor Honohan said the ATMs would continue to operate. If this is the view of the Governor of the Central Bank, let us hear a little less on the issue from others. The ATMs will remain open even if there is a write-off of the debt. However, we do not know what else might happen.

It has become fashionable again in the past few weeks to speak about Argentina's default. No one is suggesting that default would be easy or that a write-off would be palatable. A negotiated write-off would, possibly, be acceptable. Argentina is not the only country that defaulted. We do not hear so much about Iceland or Russia, which were high profile defaulting countries in recent years. Iceland returned to the sacred markets within two years. Russia prospered. The point at which it defaulted marked the lowest point in its economic fortunes. After that, it began to recover. We must consider reviewing all these deals and stating write-off is the road we prefer.

A deal will be done on the Anglo promissory notes and in good time. I believe a deal has been already done and that the only issue is timing of the release of that information so as not to make it look like a done deal too quickly. I may be wrong and do not wish to criticise in advance but if the Government strikes a deal which involves extension of the period of the loans to 30 or 40 years and a reduction in the interest rate, it need not bother coming in here and heralding it as a great triumph because saddling the next or future generations with debts which we should be paying now is no triumph. To saddle our children and grandchildren with debts which we should endure is not a great victory, although it will, of course, be portrayed as a great political victory. While it will be politically convenient for the Government to announce that it will not pay the €3.1 billion this year, which will result in a more benign electoral environment, saddling future generations is not the solution. There is a solution, which is to seek a large write-off of the capital.

There is a flaw in this Bill which in my view will be difficult to resolve, namely, the guarantors to Greece and the EFSF money involved is fragile and limited. If we continue lending money with guarantors of this type the system is in danger of collapsing. It is bad enough for Portugal and Ireland, who are already in bailout programmes, to be guarantors or involved in lending money under these schemes but we should not be including other countries in massively fragile situations. Is it realistic to include Spain, which is on the point of a bailout, Cyprus which has also been bailed out and Italy, which is in a precarious situation, as solid nations that can afford to be involved in a rescue of this type? The solution is to seek write-offs rather than bailouts, thus rescuing drowning citizens.

I wish to mention the issue raised by Deputy Ó Cuív and responded to by Deputy Lawlor. This was the issue of hope and confidence, and I would like to see more hope in what is being said today. With regard to the issue of the Bank of Ireland preference shares purchased, Deputy Ó Cuív is correct. To sell a stock on a 10% coupon when one is borrowing on the markets at 4% does not seem on the surface to be particularly intelligent. It also seems that to excuse it by saying it is all about market confidence is a bit unrealistic. Ireland was mugged in this deal. They took us for a ride and the evidence is that the day after the 10% preference shares were bought, the same people who bought them and a mass of others were queueing outside the Department of Finance attempting to do exactly the same to AIB stocks.

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