Brendan Howlin (Wexford, Labour) | Oireachtas source

Indeed. I hope Members can hear if not see me up here. I wish the Taoiseach well in his first face-to-face European Council meeting. It is really important that he meet his colleagues face to face because personal relationships are extremely important in European Council affairs, as the Taoiseach knows very well.

This is, as he rightly says, a Council meeting that will be focused exclusively on money. The last time there was a negotiation for a multi-annual financial framework, we in this country were at the heart of it. I listened with interest to the contribution Deputy McDonald made, and she was right to an extent. It had nothing to do with the multi-annual financial framework in terms of supporting us during our economic crisis. The disastrous mistake was made at the heart of Europe when predominantly conservative governments that dominated, and still dominate, the European Council required the socialising of banking debt, a process that was obviously not in Europe's interest, caused great hardships and was not supported by the International Monetary Fund, which would have assumed that banks would be allowed to fail, that the pillar banks would be protected and that bondholders would take the consequences. That is an argument for another time.

The euro area now faces an unprecedented crisis, as the Taoiseach rightly says. It is expected that the GDP of the area will shrink by 8.7% this year and the GDP of the EU as a whole by 8.3%. GDP in Europe has collapsed by a massive 17% in the first six months of this year. A 17% recession in GDP terms in six months is unprecedented. The plan is therefore of critical importance. As the Taoiseach has outlined, it has a number of components.

The multi-annual financial framework is unchanged from the February, pre-crisis presentation. It consists of €1.074 trillion. There are rebates for a number of countries, including Denmark, Germany, the Netherlands, Austria and Sweden, with the new recovery fund of €750 billion to be paid through MFF programmes: loans, guarantees and grants. Of course, the devil will be in the detail. As I said in my last contribution, offering loans to countries such as Ireland right now is of little value. We can borrow at less than 0.25% interest, and did borrow €6 billion last month. Our short-term treasury bills are in negative interest rates. Access to cheap borrowing is not what we need. We need to ensure we have grants. I would be interested to hear what exactly the Government expects to achieve in financial terms. Perhaps the Minister of State, Deputy McConalogue, will indicate that. What will be the Government's objective when it sits down with its colleagues in the coming days?

The allocation of the recovery and resilience facility, RRF, will be critically important. Its stated objective is that the money will go to countries and sectors most impacted by the pandemic. As the Taoiseach indicated in his contribution, 70% of the money is to be committed next year and the following year, in 2021 and 2022, with the balance of 30% being allocated in 2023 and the whole sum being disbursed between now and 2026. Some 30% of the overall fund is to be devoted to climate-related issues. This is a really exciting prospect for us. We could potentially be the offshore wind engine of Europe, and the Commission is excited about this. We need to get on with that. I hope the Government will be very ambitious in the expenditure targets it sees for offshore wind and hope it will recognise, if I may be parochial for a second, Rosslare Europort as the ideal location for east coast wind. There are already significant proposals that need support to bring that about.

Just by way of an aside, I wish to mention the additional conditionality, which I welcome because it is really important, particularly in the context of the presidential election in Poland on Sunday, in which President Duda was re-elected. The maintenance of the rule of law and of European values will be one of the criteria used to determine eligibility for European funding. It is not good enough for any country to abandon the fundamental principles of the rule of law, freedom of expression and the separation of powers and expect to be part of the European family when it comes to the divvy-up of money.

From 2026, repayments will have to be made, an issue the Taoiseach touched upon. What is set out in President Michel's plans is a plastic waste tax, which I think we would welcome, although I think we have all been looking with horror in recent months at the billions of pieces of single-use plastic and disposables we have been generating, whether masks, gloves, shields or gowns.

Billions of pieces of disposable waste are being generated right now, which is a cause of concern. Others referred to the digital levy President Michel touched upon. He envisages this will be introduced by the end of next year, which is not in the distant future. I would be interested to hear the Taoiseach's view on how that is to be brought about and what his attitude to it is.

On the €5 billion Brexit reserve fund to be created and, to quote President Michel's, "to counter unforeseen consequences in the most affected Member States and sectors". That is very welcome. Some €5 billion is a significant sum but it is not that significant if it is to be divided up between a number of countries. We will see the details of how that is to be distributed in due course.

The Commission member, Paolo Gentiloni, in an article in the Financial Times, pledges to revive plans for a digital tax on big tech companies. In May, despite legal changes we have made in the past ten years in this country, the Commission warned that features of our tax law, together with that of Cyprus, Hungary, Luxembourg, Malta and the Netherlands, still facilitated "aggressive tax planning". We cannot have a situation where we are perceived to facilitate aggressive tax planning by anybody. Some have categorised us as a tax haven. We need to be very clear. We have made substantial changes but other changes need to be made. I strongly support the OECD process because we cannot change the conditionality of the competitive advantage of Europe vis-à-viscountries like Israel or Singapore by having a uniquely onerous tax regime. However, we need to ensure that multinational companies pay their fair share of tax and that has not been the case. Let us acknowledge that and let us bring - I hope with a new President in America - the whole base erosion and profit shifting, BEPS, process to a successful conclusion.

I am concerned generally with the propensity of the Commission in recent times to use Single Market rules designed to protect competitiveness in the Single Market as Trojan horses to attack states' taxation regimes. That has come into sharp focus in the Apple judgment today. We need to have an open and frank discussion about that and the Taoiseach might facilitate that at a future date.

My final point relates to PEACE PLUS. I was involved in negotiating the PEACE IV programme as part of the last multi-annual financial framework. It was not easily won, let me say. There was no enthusiasm from the UK at that time to support it. It opposed any increase and any measure and wanted the overall budget decreased. We fought that but without the UK, has the Taoiseach a commitment that there will be an ongoing peace fund to tackle the difficulties that will continue to be faced by people North and South of the Border on the island of Ireland, particularly in the context of Brexit?

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