Enda Kenny (Mayo, Fine Gael) | Oireachtas source

I am pleased to have the opportunity to speak to the House today on this topic, which is of major significance and importance to us in the context of our national, bilateral and international interests. We are now approaching a critical juncture.  In just nine weeks, on 23 June, the UK electorate will answer the question that is being put to them in their referendum; it is a straight choice on whether the UK should remain as a member of the European Union or if it should leave. This referendum result is, of course, solely a matter for the UK electorate to decide but it must be recognised that the answer they give is of enormous interest and importance not just to us, the UK's nearest neighbour, but also to the wider European Union and international community.

I will set out a few essential elements of the Government's approach.  As the UK’s closest neighbour, Ireland has a unique perspective and interest in the outcome of the referendum. We will remain a member of the EU irrespective of the referendum result. We want the UK to remain part of the European Union and to work with us to make it better. We will continue to build on the strength of the British-Irish relationship that has benefited from our common membership of the European Union, especially in the Northern Ireland context, and as co-guarantors of the Good Friday Agreement. We will continue to articulate our position and promote engagement and understanding on the issues. We will deepen our analysis and understanding of the risks associated with a Brexit and ensure that any necessary contingencies are put in place.

At home, in London and in Brussels, we will continue to engage with our partners and work to ensure that we meet all of our objectives. From the Government’s perspective, there are three distinct phases to this. Phase 1 was the period from the UK election result to the conclusion of the new EU settlement deal and the setting of a date for the UK referendum. Phase 2, the current phase, is the lead-up to the date of the UK referendum. Phase 3 will commence once the referendum result is decided.

In respect of phase 1, the discussion of the UK's position within the EU has gained in intensity since Prime Minister David Cameron’s Bloomberg speech on the issue in January 2013.  In 2014, our national risk assessment named Brexit as a strategic risk for the first time.  This helped to stimulate public debate on the issue while also informing the Government's need to intensify preparations. In May 2015, the Conservative Party formed a new UK Government and Prime Minister Cameron set about delivering on his commitment to negotiate more favourable arrangements for continuing British membership of the EU and to hold a referendum on the issue.

During this time, the Irish Government has been very active in our engagement with the UK Government and with our EU partners in outlining our concerns and our interests in this matter, in working for an acceptable deal at EU level and on assessing the implications in the event of a UK vote to leave the European Union. In early 2015, I reorganised my Department specifically to prepare for this issue and established a new division in my Department to focus specifically on relations between Ireland and Britain, including bilateral issues that arise in the context of the EU-UK debate.  During this phase, work has been under way across Departments to identify the key strategic and sectoral issues that could arise for us if the UK were to vote to leave the European Union.  My Department’s EU division has also been centrally involved in these discussions and was responsible for preparations and input to the EU negotiations that resulted in the agreement in February.

Both I and my Government colleagues have emphasised at every opportunity that Ireland has a unique relationship with the UK, which is recognised widely, including within the UK itself. We have made it clear that Ireland's best interests are served best by the UK remaining within the European Union. It is a position that I have emphasised on numerous occasions, including when I spoke at the CBI annual conference in Belfast in March last year, at the British-Irish Association in Cambridge last October, at the CBI annual conference in London last November and more recently at an event organised by Irish interests in London this January. I met Prime Minister Cameron six times on a bilateral basis since 2013 and have ensured that our discussions cover our position and our concerns.  Those conversations have also been continued in the context of our frequent meetings at European Councils.  The Minister for Foreign Affairs and Trade, Deputy Charles Flanagan, and our other colleagues in Government have had extensive engagements on the issue with their UK counterparts. I have also discussed Ireland's concerns with Northern Ireland's First and Deputy First Ministers and the Scottish First Minister. EU and UK issues have been discussed by the North-South Ministerial Council.

The position of the Government and our strong preference for the UK to remain as a member of the EU remains unchanged. It is a view widely shared across the Irish political spectrum and by the great majority of business, non-governmental organisations and academic or media commentators here. Essentially, we have set out four reasons we wish the UK to remain a member of the EU.  These relate to the economy, Northern Ireland, the Common Travel Area and the effectiveness and credibility of the European Union itself.

The importance of the Irish-UK economic relationship is apparent in the €1.2 billion in goods and services that we trade every week.  Last year, 41% of our total agrifood and drink exports went to the UK.  They export more to Ireland than they do to China, India and Brazil combined, making us the UK’s fifth largest market.

This trade sustains approximately 200,000 jobs each side of the Irish Sea. The UK is the third largest investor in Ireland after the US and Germany. In 2012 and 2013, investment by Irish businesses in projects in Britain helped to create and sustain almost 2,800 jobs.

Overall, studies show there would be an adverse impact on both the British economy and, in turn, on the Irish economy were the UK to decide to leave the European Union. The ESRI report on the potential risks associated with a Brexit noted that a 1% decrease in UK GDP leads to a 0.3% decline in Irish medium term GDP or GNP. Clearly, the beneficial economic relationship enjoyed by our two countries would be at risk in the event of a vote by the UK to leave the European Union. Research has shown that Irish-owned enterprises and SMEs in sectors such as agrifood could, in particular, face significant challenges. In addition to trade, issues could arise for the energy sector in areas like security of supply and the single electricity market.

There has been some suggestion that a UK exit could give Ireland a marketing advantage in foreign direct investment terms, but we have to be realistic. We would also face intense competition from other EU member states and the ESRI research suggests that we would not necessarily see major gains. It has also been suggested that opportunities might arise for us in the financial services sector, but it is important to note that capacity issues may well arise here. In considering negative impacts, research also suggests that Northern Ireland would be the most adversely affected region of the UK.

The EU has made an important contribution to sustaining peace and prosperity in Northern Ireland and has provided a broader context for relations on these islands. Much-needed funding, including through programmes like PEACE and INTERREG, will provide almost €3 billion in the six years to 2020. It is also the case that North-South co-operation is simply much easier when both jurisdictions are members of the same Union.

Our governments are co-guarantors of the Good Friday Agreement and our officials and agencies work together every day in many small and big ways to support the social, economic and political transition of Northern Ireland coming out of the difficulties that it experiences. The trust that enables that kind of close co-operation was forged at least in part through years of working side by side in Brussels since 1973.

The fact that we and Northern Ireland make up the island of Ireland is also a key consideration for us in the context of the EU-UK debate. The common travel area, which has been in existence since Irish independence, is an important feature of the close relationship between our two countries. It allows free movement between Ireland and the UK and ensures that Irish citizens and British citizens are treated on a par with access to social welfare. It is an arrangement that is valued on both islands and I believe that both governments would work hard to preserve its benefits in the event of a UK vote to leave the EU. It is particularly important as regards the Border between North and South, which has in practical terms been effectively eliminated.

This cannot be guaranteed, however. We should be aware that the common travel area has only ever operated where both Ireland and the UK were either outside the European Union or within it. Any uncertainty that is created around the seamless flow of goods, services, capital and people between our two countries would not be welcome. These would be key issues for Ireland both bilaterally with the UK and also in the context of new terms and conditions for the EU’s relationship with the UK, but the precise outcome would by no means be clear.

Our close relationship with the UK is also an important feature of our engagement on EU issues. The UK is an important voice at the table in Brussels and we want that voice to continue to be heard. We are allies on many of the key issues facing the EU, above all on economic issues, and we share a broadly similar vision for Europe. We want to see a Union that is globally competitive, with a fully functioning Single Market, including in the digital area, internally efficient and outwardly coherent on trade, innovation and world affairs, including migration. We also want a Europe that respects and draws strength from the differences between member states.

The withdrawal of the UK would change the balance of opinion within the Union on these and other issues in a way which could damage Irish interests. More broadly, it would weaken the Union internationally and at home, in terms both of substance and reputation, at a time of serious challenges.

I must emphasise that whatever the outcome of the referendum, Ireland will continue to be a committed member of the EU and the eurozone. That is what our people have said on many occasions and it is repeatedly borne out by opinion polls. We value our access to a single market of over 500 million people and the benefits our exporters derive from EU trade agreements with other countries.

Our EU membership is a key asset for Irish business, as IBEC underscored last week in a valuable report, and in attracting inward investment. Irish agriculture continues to benefit greatly from the CAP. More broadly, we are conscious of the significance of being part of a Union with other like-minded democracies which share our values and interests. There is no doubt, however, that the Union we most want to see is one with the UK in it.

A Cheann Comhairle, I know I am over my time, but I have some other issues to raise here if the House agrees. I can read it here, or put it into the record if you wish.

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