Brendan Howlin (Wexford, Labour) | Oireachtas source

There are dark clouds on the horizon, some of which I mentioned this morning. The United States has placed €6.8 billion worth of tariffs on European trade that will directly affect our exports. The United States is also engaged in a trade war with China that affects the global supply of components for manufacturing, with knock-on effects for manufacturing in Ireland. Most countries, including Ireland, are not doing enough to combat climate change. As we have heard, Turkey is taking aggressive military action in Syria, while Russian interference continues in several eastern European countries. These are very difficult and challenging issues.

As we all know, Brexit has cast a shadow over Ireland for more than three years and it will continue if the United Kingdom does leave the European Union as the issue of the future trading relationship will continue for years to come. Europe faces a range of other serious geopolitical problems. I was glad to see the European Council condemn Turkey's aggression in Syria and urge Turkey to end its military action. I also welcomed the ending of arms sales licensing to Turkey by all member states.

As I indicated during Taoiseach's Questions, I deeply regret that the European Council failed to give the positive sign required to Albania and North Macedonia on their future membership of the European Union. As I said, I met Prime Ministers Edi Rama of Albania and Zoran Zaev of North Macedonia in advance of the European Council. They are passionate about moving their countries towards EU membership and know that it could take decades. In one interaction one of the Prime Ministers said to an objecting Prime Minister that that person would have left politics by the time his country became an EU member state and asked them to just let them move on in that journey. Introducing reforms to embed democracy and the rule of law is a difficult journey for them and they should be given every encouragement. They have made great strides to strengthen the independence of their courts. North Macedonia even changed its name. These are major issues for them. Therefore, I very much regret the stand taken by France, in particular, but also by the Netherlands and Denmark to block their hopes of beginning the journey towards EU membership. Beginning the process would have been a sign of strength and confidence. Instead, countries in the Balkans are turning to Russia and China for assistance, something which will create long-term weaknesses for the European Union. We should not miss these opportunities. We cannot take for granted that these populations will remain positively disposed to the European Union forever. After decades of delay we saw how politics in Turkey moved towards much more hostile nationalism, which manifested recently in the unilateral military action taken against Europe's allies in the Syrian conflict.

The European Council also discussed the multi-annual financial framework. There is very little detail in the published conclusions of the meeting and I know that we are at an early stage, but I understand the figures will be discussed at the December Council. I am seriously concerned about rumours that the European Union will effectively cut its budget following Brexit by limiting it to 1% of economic output. That would be a mistake. Europe has serious problems with low growth in economic output, with low growth in job creation in many European countries as a result. What it needs above anything else is a stimulus. There is a limit to how long savers can cope with very low or even negative interest rates. Europe needs major investment in its infrastructure, even in developed economies such as Germany. According to expert opinion, we have only ten years to make real progress on climate change according. That requires significant investment.

Brexiteers argue that the United Kingdom would save money by leaving the European Union because it is what they classify as a net contributor. This gave rise to the infamous myth that the NHS would gain €350 million one week after Brexit. In fact, the idea of being a net contributor is a myth. No member state of the European Union is a net contributor. On a short-term accounting basis, some countries gain more or less in direct EU spending than they contribute to the EU budget, but every member state gains far more from membership owing to economic growth and trading opportunities than they would if they were outside the block. This realisation has dawned belatedly on some in the United Kingdom. The British Government's own estimate is that the British economy may grow more slowly, meaning €2 billion per week less in economic growth than would have occurred if the United Kingdom had remained in the European Union. The loss of potential economic growth far outstrips the cost of any net contribution it was making to the European Union. The taxes it would raise from €2 billion worth of economic activity per week would easily surpass the so-called £350 million payment to the EU budget. Unfortunately, Brexit thinking has not just affected the United Kingdom. Some other EU member states are also complaining that they, too, are net contributors to the EU budget using the same spurious bookkeeping analysis.

I am glad that the Taoiseach confirmed this morning that our Government is not one of those arguing for a smaller EU budget into the future. The size of the EU budget should depend on what we want to achieve and what is most economically efficient in achieving our objectives. If more spending at EU level raised economic growth and created more jobs, we should be open to a larger budget.

In particular, we do not have the time to hesitate when it comes to investing in climate. My socialist colleague, Frans Timmermans, has been nominated as Vice-President of the European Commission for a green industrial revolution. If we are serious about transforming our societies to reduce our dependence on fossil fuels, we must make major investments now. Some of those investments are best made through the European institutions such as the EIB, environmental changes to CAP, as the Taoiseach outlined, and some regional funding streams such as LEADER. I call on the Government to discuss the plans of Frans Timmermans for a green industrial revolution and to take seriously the call for additional funding to achieve real and meaningful action on climate change.

The European Council has appointed Christine Lagarde as President of the ECB, and I welcome her public commitment to take an evidence-based approach to focus on gender, climate and inequality. Europe and the eurozone need an economic stimulus and the ECB needs to play a role in facilitating and providing the mechanisms for that. Recent reports highlight the fact that quantitative easing done under Mario Draghi has reached near maximum capacity in buying bonds issued by member states. Current rules forbid the ECB to hold more than one third of any member country's bonds. Ms Lagarde has made a useful suggestion for EU governments to co-operate in a stimulus programme by creating an EU-wide market for investment in climate technology. I call on the Government to examine those proposals and advance them, if possible.

The Council also discussed the draft strategic agenda of President-elect of the European Commission, Ursula von der Leyen. I want to make it clear that the Labour Party does not support the proposal in the President-elect's programme based on what was called the European way of life. When I met Prime Ministers and party leaders from the European socialist parties, they made it clear that socialist members of the Council and the European Parliament will not vote in favour unless that position and terminology changes.

I have purposefully made very little comment about Brexit in this contribution because God knows we have made long contributions at other opportunities. I stress that this was a critical Council meeting for the Brexit discussions. When I met Michel Barnier last Tuesday, I thanked him personally for the solidarity his team and the EU 27 have shown Ireland. I also expressed my thanks for that solidarity when I met the European socialist leaders. The solidarity of the European Union has been critically important during the Brexit negotiations but how we go forward is not yet clear. Contrary to spin from the Conservative Party, the British Parliament has not approved the deal; it has simply allowed legislation to be debated. It has just got past the first hurdle. On the basis of saying the British Parliament has passed the deal, we could say that this Parliament has passed 200 Bills that are now in limbo.

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