Paul Kehoe (Wexford, Fine Gael) | Oireachtas source

I propose to take Questions Nos. 28, 29 and 32 together. The College of Commissioners adopted the European defence action plan on 30 November last. This is simply a proposal from the Commission. It has not been discussed or agreed by the member states or the European Parliament. As such, it has yet to go through the wide ranging and extensive EU procedures before any part of it becomes a reality.

The aim of the plan is to explore how EU policies and instruments can ensure that the EU's industrial and skills base will be able to deliver required defence capabilities in view of current and future security challenges. As part of this plan, the Commission has proposed the creation of a European defence fund. In addition, the plan aims to offer supports to small and medium sized enterprises, SMEs, start-ups and other suppliers to the defence industry. There are also proposals in the plan to increase transparency in relation to defence procurement under the existing EU procurement directives.

The purpose of the defence fund is to promote research and innovation and contribute to the strengthening of the European defence technology and industrial base, and to further stimulate the development of key defence capabilities. The Commission has proposed that the fund would have research and capability windows.

In the research window, it is proposed that €90 million in funding will be made available for collaborative defence research projects over the period 2017-20 in what is known as the "preparatory action". The Commission also proposed that, post 2020, a European Defence Research Programme will be established which will require funding of €500 million per annum. It should be noted that this has yet to be negotiated as part of the post 2020 multiannual financial framework.

Under the capability window, the establishment of a fund is proposed. The fund would facilitate member states in purchasing capability platforms together through the pooling of national contributions, where possible supported by the EU budget. The Commission estimates that this fund would be in the region of €5 billion per year. It is important to highlight that this would depend on individual member states agreeing to initiate joint projects which they would co-fund from national resources. To date, no such ambition on pooling resources across the union has been realised.

For certain member states in the EU, defence is a significant contributor to their economies, representing an industry of €100 billion with 1.5 million direct and indirect employees. Ireland does not have a defence industry, however this does not mean we do not need to equip our defence forces with advanced defensive systems or that we will not benefit from this action plan. The action plan puts forward a range of proposals designed to deliver additional capabilities for the common security and defence policy, CSDP, and to support and regulate the defence industry as another sector of the Single Market.

I am satisfied that the proposals in the action plan fully respect the EU treaties and the Lisbon protocols and pose no challenge to Ireland's traditional policy of military neutrality. There is also a clear recognition and reaffirmation that defence remains a member state prerogative. Decisions about expenditure, military capabilities, research and technology are matters for member states.

See this speech in context