Dáil debates

Thursday, 17 January 2019

Government's Brexit Preparedness: Statements

 

2:35 pm

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour) | Oireachtas source

The British Parliament has voted overwhelmingly against the withdrawal agreement. We are now in a period of acute uncertainty. Many of the possible options require time to develop, time that we do not have. There is little over two months to go until the end of March. It is not possible for Westminster to legislate and prepare for a second referendum in that time. It is not plausible for a substantive renegotiation of an agreement that took two years to bring to fruition in the first instance. The EU-27 might permit an extension of Article 50, but that is not guaranteed. The UK may not ask for such an extension, if its Government decides to negotiate a future relationship from outside the EU, while simultaneously pursuing other international trade deals. In short, nothing can be taken for granted.

That is the context within which we have to judge the success or failure of the current Fine Gael-Fianna Fáil Government arrangement. It is not the only context. The EU is important to us for reasons of trade but it is also important for the higher social and environmental standards it has brought us. The current international situation is precarious in terms of both trade and social conditions.

The UK’s vote to leave the European Union was not an isolated event. It is part of a series of unprecedented and dangerous developments around the world. The United States now has the most controversial President in living memory - a man who has undermined the normal functioning of the American political system and worsened already polarised politics there. Much-needed healthcare reform has been reversed under this US administration, leaving tens of millions of people without health insurance cover.

Meanwhile, several member states of the European Union are being led by right-wing nationalists who are xenophobic, homophobic and anti-liberal. They are also anti-socialist. Their policies have undermined workers' rights and protections.

Populists have risen to the fore in several countries, making wholly unrealistic promises and advancing a tyranny of the majority that ignores minority rights and democratic dialogue.

On the trade side of the equation, the US has engaged in protectionism unlike anything seen in decades. The Chinese economy is slowing down, which is affecting the whole world economy. The German economy is slipping into a second quarter of technical recession. Germany is the engine of the European economy and if it falters that will impinge upon the Irish economy all too soon. The whole European economy still has enormous challenges, including underemployment, especially in southern Europe, migration, climate change emissions, inequality between the different regions of the European Union and a failure to complete the euro currency union in a way that supports rather than punishes weaker euro countries.

In this wide ocean of events, there is a common metaphor that Ireland's small open economy is like a ship which must inevitably rise and fall on the tide of world events and the ups and downs of the global economy. This perception of Ireland's geopolitical position is often used as an excuse. Laissez-faire– do nothing – is too often the Government's policy and that is wholly inadequate and wholly inappropriate as a response to the waves that are now crashing upon Ireland's shores. It is true that Ireland's population and economic output are only a tiny fraction of that of the European Union or the wider world, but size is not a reason for inactivity. I will continue with the ship analogy. Is Ireland shipshape? Is our infrastructure in top repair and working as well as it should? Are we steering in the right direction? Does the captain of the ship even have a clear map or destination in mind? I am afraid the answer is "No".

Just last week I returned to Rosslare Europort to see what preparations are under way and how prepared the port will be to handle trade in the event that transport of goods across Britain to the Continent becomes blocked or prohibitively expensive. There is preparation for the introduction of customs, new agriculture inspections and Garda facilities, but the current timeline is for those to be delivered between three and five years' from now. They are still at design stage. No application has been submitted to the planning authorities. That is wholly inadequate when the storm may hit in little over two months' time. It seems that the risk of a no-deal Brexit has not been taken seriously. I heard the Tánaiste say again today that it is highly unlikely to happen. Let us hope that he is right, but nobody operates a Government or even a company on that basis that something will never happen.

Some people have scoffed at the surprise shown by the UK's Brexit Secretary when he discovered the volume of goods that cross between Dover and Calais, between Britain and France, and the importance of that link to the UK economy. In November last year, the Financial Times reported various scenarios concerning capacity on that route and it determined that capacity could drop to quarter of its current level, in the best case, or an eighth of its capacity in the worst case. Does anyone in this House think that sealed containers of Irish freight are going to be given free access, to skip the queue at Dover and make their way to Calais without delay? On the contrary, the most likely scenario is that Irish goods vehicles using the so-called landbridge through Britain will be put to the back of the queue, of least priority to the United Kingdom, which will be struggling to keep its shops and pharmacies stocked in many plausible Brexit scenarios.

Recently, I engaged with the pharmaceutical industry about the availability of short-life medicines in the event of a no-deal Brexit. Companies tell me they have spent months seeking clarity from the HSE but it is only in recent days that there has been a flurry of activity. It is another example of too little, too late. There is a real sense of complacency and lack of initiative at the heart of the Fine Gael Government preparations. One could ask if there a reason for this inactivity. I have tried to think about it and the only plausible answer is that there is an ideological aversion to a strong state being used as a strategic influence on the economy. The Government's inaction displays a profound lack of understanding of industry and commerce. Business owners know that sometimes one has to make investments just in case of a bad turn of events. The cost has to be absorbed, so where possible such investments should be ones that will benefit businesses in any future scenario. The bottom line is that Fine Gael has not committed to major investment and will not unless and until the crisis is upon us.

All around Europe, there is a compelling case for investment in ageing and inadequate infrastructure. Ireland needs investment in the electricity grid to increase capacity for smaller towns, to make it possible for larger industries to be situated there. We need investment in renewable electricity generation to avert climate change and the fines this country will receive for failing to meet future emissions targets. We need investment in our roads, rail and ports to allow greater volumes of trade from our ports that link us directly to France and other continental destinations. Even if Brexit never happens, all of this investment would pay dividends in terms of quality jobs, sustainable regional development and environmental sustainability, but in the context where Brexit poses a risk to tens of thousands of jobs and people's livelihoods, it is irresponsible not to have made major investments to reinforce the economy in those areas. The investment in Rosslare Europort has been an afterthought. I see the Tánaiste raise his eyebrows.

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