Séamus Kirk (Louth, Ceann Comhairle)
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I call on the Taoiseach to make his statement under Standing Order 43. The following arrangements apply: Pursuant to today's Order of the Dáil, the statements shall be confined to the Taoiseach and to the main spokespersons for Fine Gael, the Labour Party and Sinn Féin, who shall be called upon in that order and who may share time, which shall not exceed 15 minutes in each case.

Brian Cowen (Laois-Offaly, Fianna Fail)
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I attended the meeting of the European Council in Brussels on 17 June. The meeting was unusual in that it took place on one day rather than the usual two-day format for our annual June meeting. That aside, however, in terms of its business the meeting was in many ways the first relatively normal meeting of the European Council this year. While we are still in the midst of ongoing economic and financial challenges, this meeting did not take place in an atmosphere of crisis, as was the case with other recent meetings. We had a busy agenda for our meeting, but I am pleased to say that we got through it well. Much of our discussion was taken up with economic issues, ranging from the Europe 2020 strategy for jobs and growth to enhancing economic governance and to regulating financial markets. I will concentrate on these issues in my initial remarks.

The European Council endorsed the Europe 2020 strategy for jobs and for smart, sustainable and inclusive growth. This strategy is intended to help Europe to recover from the economic crisis and to emerge stronger by boosting competitiveness, productivity, growth potential, social cohesion and economic convergence. In particular, we formally signed off on the five headline targets to underpin the strategy. The first of these targets, on employment, aims to raise to 75% the employment rate for women and men aged 20-64, including through the greater participation of young people, older workers and low-skilled workers and the better integration of legal migrants. The second target seeks to improve the conditions for research and development, in particular by raising combined public and private investment levels in this sector across the European Union to 3% of GDP. We have also agreed that we need a parallel indicator to measure research and development and innovation intensity and output.

Our third target reaffirms our commitment to reduce greenhouse gas emissions by 20% compared to 1990 levels; to increase the share of renewables in final energy consumption to 20%; and to move towards a 20% increase in energy efficiency. In this context, the European Union remains committed to taking a decision to move to a 30% reduction in emissions by 2020 compared to 1990, provided that other developed countries commit themselves to comparable emission reductions and that developing countries contribute adequately according to their responsibilities and respective capabilities. In other words, we need to work together in a co-ordinated fashion to safeguard the environment while recognising the economic and competitive challenges that we all face, as well as the need for fair and balanced burden sharing.

Fourth, we are committed to improving education levels across Europe, in particular by aiming to reduce school drop-out rates to less than 10% and by increasing the share of 30-34 years old having completed tertiary or equivalent education to at least 40%. Finally, our fifth EU-wide target is in the area of promoting social inclusion, in particular through the reduction of poverty, where we aim to lift at least 20 million people out of the risk of poverty and exclusion.

A further element of the Europe 2020 strategy will be the integrated guidelines for economic and employment policies, which were endorsed by the European Council and will now be formally adopted following an opinion of the European Parliament. These guidelines are intended to inform implementation of the strategy by the member states and, in due course, can serve as the basis for country-specific recommendations that the Council may address to member states, in line with relevant treaty provisions.

I am particularly pleased that, in our conclusions on the Europe 2020 strategy, we have agreed that all common policies, including the common agricultural policy and cohesion policy, will need to support the strategy, and that a sustainable, productive and competitive agriculture sector will make an important contribution. Deputies will recall that when I reported to the House on the March European Council, I mentioned that I had been very concerned about the absence of any meaningful reference to agriculture in the initial documentation on the strategy. The language agreed at our June meeting now reaffirms that the important contribution that agriculture makes to our economy, and in terms of employment, not just in Ireland but across the European Union, is increasingly being recognised.

The next phase of the Europe 2020 strategy will be the setting of national targets by member states in pursuit of the EU-wide targets which we have now agreed, the identification of the main bottlenecks to growth, and the preparation of national reform programmes to implement the strategy. This work will be advanced over the coming months, with the Commission now proposing that the national reform programmes be submitted at the same time as stability and convergence programmes in the spring. In parallel, the Commission will flesh out the various flagship initiatives envisaged within the Europe 2020 strategy for action at Community level, having already presented the first of these - a digital agenda for Europe.

Implementation of the Europe 2020 strategy is intrinsically linked to the issue of economic governance. In this regard, the President of the European Council, Herman Van Rompuy gave a progress report on the work being done by the task force to examine crisis resolution mechanisms and better budgetary discipline across the Union, which we agreed to establish at our March meeting. The President chairs this task force, on which Ireland is represented by the Minister for Finance, Deputy Brian Lenihan. In light of the report on progress so far, the European Council agreed several orientations for the future work of the group. These orientations cover strengthening the Stability and Growth Pact; paying greater attention to debt levels and overall sustainability in the context of budgetary surveillance; the annual submission of broad budgetary frameworks for consideration each spring under the so-called European semester, while taking full account of national budgetary procedures; ensuring member states' national budgetary rules and frameworks are in line with the requirements of the Stability and Growth Pact; and ensuring the quality of statistical data.

The process also needs to focus on macroeconomic imbalances as well as fiscal ones. The divergence in competitiveness positions within the euro area is one of the reasons for the financial instability we have recently witnessed. The European Council agreed on the merit of a scoreboard system to detect macroeconomic imbalances in future. This would form part of an early warning mechanism to help prevent their re-emergence. These are important principles that should guide the work of the task force in the coming months. We will consider the final report and recommendations of the task force at the October meeting of the Council.

It is important to stress that greater budgetary discipline across the Union is in all our interests. Some have sought to suggest that this implies a loss of sovereignty, but I do not accept this. Rather, it is a necessary sharing of responsibility. The work being done in this area clearly acknowledges the role and importance of national Governments, national parliaments and national budgetary processes. None of that need be at odds with the need for greater collective co-ordination of effort or greater cross-surveillance of decisions and actions.

The European Council also took several important decisions concerning the regulation of the financial services sector. In particular, we have called for the necessary legislative measures to be finalised so that the European Systemic Risk Board and the three new European supervisory authorities can begin working from the start of 2011. We have also pressed for rapid agreement on the legislative proposal on alternative investment fund managers and swift examination of the Commission's proposals on supervision of credit rating agencies.

During our meeting we also agreed that the results of ongoing stress tests of banks by banking supervisors would be published in July, in the context of demonstrating transparency and resilience in the banking sector. We agreed that member states should introduce systems of levies and taxes on financial institutions, both to ensure fair burden-sharing and to set incentives that will help contain systemic risk in the financial sector, as part of an overall credible resolution framework. Work to move this matter forward will need to address the issue of a level playing field, as well as assessing the cumulative impacts of various regulatory measures in the sector, while recognising that specific circumstances differ from one member state to another. I expect we will also return to this matter at our October meeting.

Consideration of regulation of the financial sector led us neatly to preparation of the Union's position for the G20 summit which took place in Toronto a week later. In this regard, we agreed that we would continue to press for a global approach to the introduction of systems of levies and taxes on financial institutions as part of an overall reform of the financial system. We also agreed on the need for a co-ordinated but differentiated approach to an orderly exit from the extra fiscal stimulus that many governments had introduced in response to the economic crisis. Finally, we agreed we would press for a review of IMF quotas as part of a broader review of IMF governance issues.

Following the G20 summit, a joint statement by the President of the European Council, Mr. Van Rompuy, and President of the Commission, Mr. Barroso, said that G20 leaders demonstrated clear common resolve to create strong, sustainable and balanced global growth and that there had been convergence around the Union's approach, combining growth friendly fiscal consolidation and following through on fiscal stimulus, tailored to national circumstances, with the G20 members agreeing concrete minimum targets for deficit reduction and the stabilisation and reduction of debt. While, as widely anticipated, the G20 did not reach agreement on the issue of bank levies, it nonetheless remains determined to keep up the pace for making the financial sector more resilient to crises and risk.

Returning to our discussions at the June meeting of the European Council, we reaffirmed our commitment to the UN millennium development goals ahead of the UN summit on this issue in September. We also agreed that we would review progress between now and 2015 on an annual basis at the level of Heads of State and Government. The Minister of State, Deputy Roche, might elaborate on this item in his contribution.

On climate change, we took note of the European Commission's latest communication which concluded that conditions do not currently exist to justify a step-up to a 30% target for emission reductions and that further analysis should be carried out. We agreed to return to this topic in the autumn, ahead of the next major climate change conference in Cancun, Mexico in December. We discussed a number of other issues in less detail.

We also endorsed conclusions from the Council of Ministers regarding implementation of the European pact on immigration and asylum. We agreed that accession negotiations with Iceland should be opened following the Commission's opinion on Iceland's application for membership of the Union. We noted that Estonia fulfils the treaty convergence criteria for membership of the euro and welcomed the Commission's proposal that Estonia adopt the euro on 1 January 2011, becoming the 17th member of the eurozone. Finally, we adopted a declaration on Iran outlining our concerns about that country's nuclear programme. I expect the Minister of State will say more about this issue.

I said at the outset that this was, in some respects, the first normal meeting of the European Council for some time. There is no doubt that the current international financial and economic situation remains uncertain and the markets volatile, but we cannot allow ourselves to be in thrall to the markets or slaves to that volatility. Going into the June European Council, I was strongly of the view that we must send out a clear, positive message showing the member states moving forward, collectively and individually, in a measured, responsible and effective manner. Such an approach is not only appropriate and necessary in its own right, it is also the most appropriate response to the markets.

We must continue our efforts to bring our public finances back into balance, which is essential to safeguarding a return to sustainable economic growth. We need to work more closely together, recognising our mutuality of interest, in overseeing our broad budgetary parameters and approach. We must show that in Europe, and especially within the eurozone, we will work together, decisively and effectively, to protect our currency. We need to reform our financial institutions, both to ensure that they contribute to the costs of recovery and to ensure we do not allow a repeat of the financial crisis. Above all, we must show we are in control, that we are prepared to act and that we will take effective action. I am satisfied that my concerns going into the meeting were shared by my colleagues around the table and that the actions, decisions and conclusions of that meeting show we are prepared to act, collectively and effectively, in our common interest.

I take this, my first opportunity, to wish my colleague, Deputy Barrett, well in his new role as Fine Gael spokesperson on foreign affairs.

Enda Kenny (Mayo, Fine Gael)
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I propose to share time with Deputy Barrett.

Darragh O'Brien (Dublin North, Fianna Fail)
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That is agreed.

Enda Kenny (Mayo, Fine Gael)
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I thank the Taoiseach for his commendation of Deputy Barrett. I am sure the Deputy will fulfil his duties with his usual high level of dedication and commitment.

This was an important meeting that the Taoiseach attended as Head of Government on 17 June. I already referred during Questions to the Taoiseach to the five main headlines that were referred to by the Heads of Government, namely, research and development, job creation, reduction of greenhouse gas emissions, the importance of education as we face the future, and promoting social inclusion. The Taoiseach remarked in his contribution that some have sought to suggest that the European Union's involvement in the budgetary process would represent a loss of sovereignty. I am pleased that matter has been cleared up.

The presentation and preparation of the budget by the Government, in the context of what we discussed this morning, would be very helpful. An examination of the most pressing issues facing the Government, including the amount of money to be taken out of the economy, cutbacks, the priorities to be accorded to different Votes and so on, would be helpful to the Minister for Finance in the preparation of his budget. In terms of Europe's involvement in looking at Ireland's budgetary proposals, there should be an interaction not only with the Government but with the Parliament. The European Parliament has gained in importance in terms of its co-decision making capacity with the Council of Ministers. Europe's assessment of our Government's budgetary proposals should be made available to the House as well as the Government.

The reaction from the Government must be to put our own house in order. The OECD report indicates a stark situation where 370,000 jobs may be lost in a four-year period. If we add to that the numbers who have left and who will leave because of difficult economic circumstances, it makes for a very difficult position. The FÁS report on the labour market indicated a loss of 87,000 jobs in 2010 and a further 22,000 loses in 2011. This is exacerbated by the fact that male unemployment is now at 16.5%, twice the rate of female unemployment. Some young people who sign on for jobseeker's allowance from an early age are still drawing social welfare in one form or another well into their 50s. This is not how it should be. In the context of this document and Europe facing this problem, a great deal more could be done by the Government over and above putting several hundred people on training courses. For our part, we have pointed out a range of measures related to investment in real infrastructure which would allow for assets deemed valuable in terms of attracting local and international investment to thrive and provide real jobs. Such measures would at least in part answer the call to deal with the issues discussed at the Heads of Government meeting on Ireland's behalf.

It has been a daunting prospect for Europe and every country to react to the scale of the international crisis. We have argued previously about the extent of the impact on Ireland and whether it was a home grown crisis. Nevertheless, the situation is that Europe has responded in a way which sets out clear guidelines for countries to avoid breaching the Stability and Growth Pact and, for those which have done so, how to get back on track. These issues are of serious import for every country.

I am unsure if the Government would escape another referendum or treaty by engineering a European IMF situation. I do not foresee this as a possibility. The measure adopted by the Heads of Government at the Council was worthwhile in terms of setting up the emergency fund which may be drawn on if necessary. This was probably the only possible response given the circumstances in which Europe found itself. The reports being prepared under Mr. Van Rompuy will be important and meetings in October and December will deal with other elements of this.

The Heads of Government did not discuss the situation which arose with the blockade of Gaza by Israel. I am pleased to note some progress has been made in this regard and that on the basis of decisions now being taken general assistance and some construction materials will be allowed into Gaza under supervision. I trust this will be the beginning of a process that can become more flexible in time and lead to a situation where a position of 90% unemployment can be addressed to a greater extent. I share the Taoiseach's view in this regard and I thank the Government for the clarity of its response. I wish to leave the remainder of my time to Deputy Barrett.

Seán Barrett (Dún Laoghaire, Fine Gael)
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I welcome the fact that Europe has agreed to the adoption of the 2020 strategy. However, strategies are one thing but their implementation is another. I look forward to the Taoiseach's publication of the national reform programme, which will set out our individual targets in the various areas. I recommend strongly that we should use our committee structure to establish these targets. We should put forward proposals for debate in each of these areas such that people on committees can use such a structure to invite the views of various interested bodies and have their input in the preparation of such plans. We under-utilise the talent that exists not only on the backbenches in these Houses, but among the public. I refer also to the willingness to be of assistance if structures are put in place. I have spoken on many occasions here about the need to have a proper committee structure and I hold strong views on the matter. The number of committees should be dramatically reduced. We should have eight or nine strong committees covering various important areas and they should be properly resourced and given the powers and opportunity to facilitate an input from the public, whether accountancy firms or whoever.

I hold the same view with regard to legislation. We send Bills to committee and no one knows what is going on. Amendments are introduced because of pressure applied once a Bill is published. All of this could be avoided if the heads of a Bill were sent to a committee in the first instance. It would be preferable to let the committee seek the views of the various interested parties and, before a Bill is finalised and presented to both Houses, the input would have already been received from these groups. At that stage, the Bill would pass through the House a good deal quicker on Committee Stage and there would not be long, drawn-out Committee Stage procedure.

I urge the Taoiseach to be mindful that committees cover the five areas set out. Let us consider job creation. Naturally, we are all in favour of job creation. How do we create jobs? I refer to the area for which I was responsible until my recent appointment. I was the Chairman of the Joint Committee on Climate Change and Energy Security. The Taoiseach has heard me making noises previously about our failure to put in place the various structures and legislation to enable us to develop a natural resource which, some day, please God, will see Ireland as a net exporter of energy. I refer to the interconnection with Great Britain through Northern Ireland to Scotland links and ultimately with France and the north-eastern part of Europe. I refer to the vast potential into which we could tap. We have a natural resource and we should be leading research into the development of wave power and offshore wind power. Jobs will flow as a result and there will be cheaper costs for industry in terms of the production of goods through cheaper electricity and so on. Ultimately, it is a matter for all of us, not only the Government, through proper structures having an input into these national, realistic plans. I believe a commitment exists to achieve this if we are given the opportunity to do so.

I am beyond my 60th year now. In my time, my mother and father had to find the money to send me to secondary school. Thankfully, we now have so-called free second level education. It was a great struggle for my parents and I believe many parents were in the same boat. However, there is now a great opportunity for people to get at least a second level education. I refer to my generation. Numerous men and women with whom I was familiar never had such an opportunity simply because their parents could not afford it. Access to education is the most important thing for Europe, whether first, second or third level. This is a fundamental principle that we must defend. We must use the opportunity not only to continue with the same type of leaving certificate and apprenticeship training.

I visited the Dún Laoghaire College of Further Education which is renowned for apprenticeship training. I refer to the difficulties caused as a result of the downturn in the construction industry. Why should someone who wishes to be a carpenter or plumber have to find a sponsor? Why should one not be able to leave school with a desire to be a plumber and proceed to third level education and become a plumber? During my training, I will be taught how to manage books and form my own business. That should be part of business training. Why should I need to be sponsored by people? If something goes wrong and I cannot find a sponsor, what do I do? If one wants to be a doctor, one does not have to find a doctor or surgeon to be a sponsor. This is why we are way behind in looking to the future and changing our current system, although it should not be changed for the sake of it. We should encourage entrepreneurs who have skills with their hands and not only their brains. Some people have significant manual skills and they can move from one task to the next. I, unfortunately, do not have that talent. However, many do and they should be trained to be entrepreneurs in their own right. By doing so, we will eliminate the black economy where it is case of, "Give us €50 and we'll forget about it". We must face up to these issues and be realistic. I hope in drafting the plan through the Joint Committee on Education and Science, we will use the opportunity to discuss how we should change and consult. Students, particularly those who have been through various types of colleges, and not only the education authorities should be consulted about where improvements are needed.

I am a great believer in the European system. Thanks be to goodness in these difficult times that we are part of the Union. By sharing its resources, it can get us all out of the mess we are in. Let us all contribute to maximising the great resources we have, particularly our natural resources. Our major contribution will not only be securing energy for Europe through interconnectors but also by becoming an exporter of that energy. I look forward to debates on this issue.

Joe Costello (Dublin Central, Labour)
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I congratulate Deputy Barrett on his elevation to the Front Bench and on his appointment to the Joint Oireachtas Committee on Foreign Affairs.

The June summit concentrated on the ten-year European 2020 strategy for jobs and sustainable growth and on a package of proposals to help create financial stability in the markets of member states, which was appropriate because they are critical issues. Like Deputy Kenny, I was disappointed that the Taoiseach did not mention the Gaza conflict or the Israeli-Palestinian crisis, considering an Irish ship was hijacked and impounded in Ashdod by the Israeli authorities and nobody knows what has happened to its cargo. I thought the Taoiseach would have raised this but perhaps it was raised on the margins of the summit and he might mention this in his reply.

The summit was one of the most important European Council meetings in recent times as the Heads of State, including the Taoiseach, agreed broad parameters for the next decade and the decisions taken were far-reaching and important. I have a gripe about the manner in which we conduct our business in this respect. Today, three weeks after the event, we are discussing what happened, the conclusions and decisions but this is a worthless, empty exercise. There was no opportunity prior to the Taoiseach's trip to Brussels to tease out the issues in the strategy, engage in debate, elicit the views of the Oireachtas and hold the Government to account for decisions it was about to take, which we are elected to do. I do not say we would necessarily have failed to endorse the strategy but Members might have liked to have matters emphasised or dealt with differently. The Taoiseach referred to the omission of agriculture in the original proposals. He stated Ireland had worked to ensure the sector was covered and that all common policies such as the Common Agricultural Policy will be integrated in such a manner to become part of the overall strategy. The manner in which we conduct our business is unacceptable in any circumstances. In the context of the provisions of the Lisbon treaty this was not envisaged for member states. There is a great deal of work to be done in this regard in order that we do not have ourselves back in the House in these circumstances where the horse has bolted and we are debating in a vacuum.

The Lisbon strategy had as its objective the creation of the EU as "the most competitive economy in the world". Sadly, this did not transpire and many EU economies are in crisis with debilitated banking sectors and sharply increasing unemployment. Ireland is an extreme example of how a healthy economy can rapidly deteriorate and collapse and of how full unemployment can suddenly become 13% unemployment in a few years. Poverty levels throughout the Union did not improve over the ten years of the previous strategy. A total of 80 million citizens are living in poverty or at risk of poverty. It is proposed the number will be reduced by 25% in the new strategy to take 20 million people out of poverty. That target was also set in 2000 but it was not met and the position is as bad as it ever was. That was the acid test of the Lisbon strategy and it has failed.

The objects of the new European strategy for this decade are remarkably similar to the previous strategy. It proposes to boost competitiveness, productivity, growth, social cohesion and economic convergence and it sets out a vision of Europe's economy for the 21st century, while asserting the Continent can emerge stronger from the crisis, even though there was supposed to be no crisis at this stage. However, while the strategy and its objectives are laudable, as with its predecessor, how will it be ensured it does not go the same way and fail as dismally?

If Europe 2020 is to succeed, member states must co-ordinate their actions, act collectively, reform their financial governance structures and, above all, be honest with each other and provide correct data to EU institutions. They must impose regulation and supervision on the financial markets. However, it is difficult to ascertain how individual member states will implement these proposals, if at all. At the same, EU institutions must exert surveillance and monitoring over financial institutions and the economic policies pursued by member states.

The European Union must ensure that the budgetary policies of member states are in accordance with agreed principles and parameters and that the Stability and Growth Pact is implemented effectively, rather than simply being disregarded as has been the case up to now.

Without effective implementation and constant monitoring, Europe 2020 will go the way of the Lisbon strategy. It must be implemented as quickly as possible, with the agreement of the member states, and the principle of subsidiarity must not be breached in the process, while the sovereignty of each member state must not be undermined. I agree with the Taoiseach that what we are doing at present is a necessary sharing of responsibility. We are not, in fact, in breach of the principle of subsidiarity or of the sovereignty of each country. It is promised that the task force to examine economic governance will produce its final report in the autumn. We hope that will be robust and point the way forward.

It has been proposed that there should be a budgetary spring semester, and that member states would come together under the auspices of the Commission and indicate the broad parameters and guidelines of their respective budgets. That would be very worthwhile. One would think budget preparations were the third secret of Fatima in this country. The budget was always a secretive matter, I believe unnecessarily, but now that these matters will be discussed in Brussels every spring, we should have our own spring semester in this country in which the House would discuss these matters prior to the Taoiseach and the Minister for Finance going to Europe and discussing them with their 26 partners there. This should be an opportunity to bring some of the thinking on the budget into the open and for the House to discuss it, rather than waiting for the Minister to reveal a budget that is seen to be the greatest mystery in the country. It would be much better if we conducted these matters in a proper and open fashion. Perhaps the Minister will consider holding our own pre-Europe budgetary semester in the House.

The headline targets that have been set are laudable. Nobody can object to a smart, sustainable and inclusive economy or to the five headline targets. The question is how we will implement them. How will we achieve a 75% employment rate for men and women aged from 20 to 64 years? The greater participation of young people, older workers, low skilled workers and the better integration of legal migrants will have to be teased out considerably if it is to take place. There is little in our present policies to suggest there will be any progress in that direction, particularly in the areas specified.

The second headline target is improving conditions for research and development, with the aim of raising combined public and private investment levels to 3% of GDP. How will that happen? We are less than half way to the target at present. There is no worthwhile private development and investment coming in and the State is too strapped for cash to provide it in this sector as well. It is obsessed with investing and injecting money into the banks, which is where all the money appears to be going at present. We have long way to go before we can operate meaningfully in the research and development area. The new Irish EU Commissioner, Ms Máire Geoghegan-Quinn, has the innovation and science portfolio so, hopefully, it will be pushed a little more strongly than it has been in the past with regard to this country getting involved in research and development.

We have a bigger problem, however. A huge amount of research is taking place in our universities but it is taking place in a vacuum. There is no link between the research that takes place, the design of a product and the marketing of that product. We are almost incapable of bringing research to the marketplace to generate employment and create wealth or to make it commercial. We are far behind countries such as Finland and Israel, which have a process and structures in place for providing the public and private investment, conducting the research, using third level institutions and linking them to industry, having creativity in the design models and then marketing them, in terms of bringing the product to the market and being commercial. We must do a huge amount of work in that regard but nothing is being done at present. Who will drive that?

With regard to reducing greenhouse gases, we have had the 2020 target for a long time. The proposal was to raise it to 30% if the situation warranted it but, given the Taoiseach's remarks, that will clearly not happen. He indicated that 2020 is the end of it. The ambitious targets are not there, which is disappointing. Of all countries, as Deputy Barrett said, Ireland has great potential with regard to new renewable energy sources. Investment and research are required in this area. Ireland has the potential to be the leading country in the EU with new energy sources so we should set new targets that are well in excess of the 20%.

Education will be our biggest problem. We have not reformed the education sector for a long time. It is stubbornly difficult to achieve reform in that area. Our examinations system is driven by rote learning, and there is very little creativity in our second level system. Many of the subjects that are necessary for the progress we are discussing are not studied. A few months ago the former chief executive of Intel, Mr. Craig Barrett, showed the statistics that prove we are far behind in studying mathematics and science and as a result are seriously hampered with regard to industrial output. That is the issue. That feeds into the area of research and the link between research modules that are carried out but being unable to bring a product to the market.

There is a long road to travel. The draft national reform programme must be published as quickly as possible. It must be finalised by spring next year so it must be published as quickly as possible to facilitate a debate on it and to ensure structures can be put in place to deal with the many challenges outlined in the Europe 2020 strategy.

Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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Tá sé tábhachtach go bhfuil an deis seo againn labhairt arís ar na cruinnithe mullaigh seo a bhíonn ann trí nó ceithre uaire sa bhliain ag Comhairle an Aontais Eorpaigh.

Like other Deputies I consider it strange that, given the supposedly key role the European Union has in the quartet, there does not appear to have been any discussion of Israel's heightening of tensions in the Middle East with its murderous attack on the aid flotilla, which carried many EU citizens on board. Perhaps the Minister will elaborate on whether it was discussed on the margins of the Council meeting. What was discussed, given the preferential position Israel has in Europe through the preferential trade agreement, the growth in the boycott, divestment and sanctions, BDS, lobby in other EU states and particularly in Ireland and the position some European countries have taken recently? I find it strange it did not put itself on the agenda.

I also wanted to find out whether the former British Prime Minister, Tony Blair, who is supposedly the peace envoy for the Middle East, was speaking on behalf of the EU when he hailed Israel's move, yesterday or the day before, to reduce the blockade as a significant milestone. The list of controlled items has been reduced, not that anybody ever saw the full list of what was controlled as they just knew what was allowed in, which was minimal. All this ignores the fact that the siege of the Palestinian territory of Gaza is nearly three years old and there had previously been intermittent blockades of that part of Palestine by Israel.

I welcome the easing of the blockade for humanitarian reasons. However, this does not take away from the fact that the siege-blockade is illegal. The Minister for Foreign Affairs, Deputy Micheál Martin, has said as much in this House. I ask what is the EU stance in this regard. If the blockade is illegal, we should not be celebrating its removal or calling this action a significant milestone.

The blockade needs to be lifted completely. It is an air, sea and road blockade which is contrary to international law and the only sustainable solution is the complete and immediate lifting of the closure. The root cause of the continuation of that siege is the immunity which Israel enjoys. The international community and the EU in particular, seems to have granted Israel further privileges based on the fact it is violating human rights. This amounts to collective punishment. The Minister for Foreign Affairs, Deputy Martin, has used those terms. If this is the case, I find it difficult to understand how it was not discussed as a main topic at the Council meeting, given the murderous attack on the flotilla and considering Irish and other EU citizens were on board ships. Neither should we celebrate the partial lifting of this blockade.

The permitting of secondary goods into Gaza without allowing the local economy to produce its own goods will only increase the dependency that currently exists on imported goods and aid from abroad. This exacerbates the crisis of self-determination and dignity among Palestinians in the long term. I hope there will be time to return to this point.

I refer to the Taoiseach's contribution when he said, "it is important at this point to stress that greater budgetary discipline across the Union is in all our interests. Some have sought to suggest this implies a loss of sovereignty. I do not accept this". I disagree fundamentally with the Taoiseach's statement. I believe that interference from the European Union in Irish budgetary affairs is a loss of sovereignty; it is not a sharing of responsibility. It is also an insult, not only to the Minister for Finance, this House and the Oireachtas but also to the Irish people. There should be no suggestion that we as a people are not capable of taking realistic, responsible financial decisions, in the interests of the public, that we have to be baby-sat - which may be the wrong word - dictated to about each and every financial measure we need to take to extract ourselves from a mess not of our making but of this Government's, the national and international banking sectors and also as a result of predatory practices.

I have disagreed with this policy for a considerable period of time. Europe's forced adherence to the stability and growth pact is hampering our economy's ability to recover. The Stability and Growth Pact forces countries to stay within a 3% budget deficit and this was arbitrarily ignored by the larger countries during Ireland's boom years in particular. We were held up as a shining example to other countries because of our ability to meet the strict criteria during those times. It now seems that all of that ability was based on false money. Our budget deficit has now soared to 12.8% of GDP and that 12.8% ignores the borrowings being undertaken for the banks because that is off the Government's central balance sheet, courtesy of the special purpose vehicle signed off by Europe. Here is another fraud being committed because the figure of 12.8% is not a real figure, which is much higher. There has been a complete under-estimation because we are evading the negative consequences of all that borrowing in order to bail out the banks.

The Government has promised Europe it will bring the deficit back to within the 3% dictated by the Stability and Growth Pact by 2013. Is this with or without the special purpose vehicle's funding requirements? The 2013 deadline is not only ridiculous with regard to what it means in spending cuts and tax increases, it is also completely random. Why is 2013 the deadline year? Why not 2014 or 2020? Why not associate it with the 2020 strategy? Various economic commentators have posed this question of why should we place ourselves under such enormous pressure to meet the Stability and Growth Pact which makes no sense to begin with. The Government could have gone to Europe with a seven-year or ten-year recovery plan. The indecent haste to meet a fantastical rule set by people who at times ignored the rule themselves makes no sense.

This Government has also tied the State to the EU's blind determination to protect the euro which means participating in the bail-out of Greece when our deficit exceeds that of Greece. In a few months' time we could have the potential situation where Greece is asked to bail out the Irish economy. This shows the ludicrous nature of what is being discussed and imposed upon us. It means partaking of a new loan facility fund, despite the demands that fund can put on a state if it avails of those finances. The EU is becoming the IMF and this Government is signing up wholeheartedly to it, up to the point of agreeing that Brussels should have sight of and commentary on our sovereign budgets in advance of them being put to the national Parliament. This is an insult to this House and an insult to the budgetary process which has gone through the Oireachtas quite well for a number of years. The Government is signing up to an interference from outside in our affairs. That amounts to a loss of sovereignty.

The EU hampers our recovery in other ways. A colleague, Senator Pearse Doherty, was recently lobbied by firms in Donegal that lost out on tenders to firms from the Six Counties and England because those jurisdictions do not have to honour the existing Registered Employment Agreements, REAs - the pay and conditions of those in the construction and hotel industry - that apply to certain work in this State. This is perfectly legal because of the Laval and Viking decisions. Any company can now tender for an Irish project and pay its workers the rates of its home country, which will often be less than hard-fought rates in this State. More jobs are being lost in the State. How does this fit in with Europe's strategy for jobs and the Europe 2020 strategy hailed as the best thing since sliced bread? The strategy is aimed at lifting 20 million people out of poverty while workers in Donegal are being put into poverty and unemployment. This Government has nailed our fortunes to those of the EU through the taking of referendums for a second time. The Government can now use the EU as an excuse and claim it has no ability to make decisions in the interests of the citizens of the State and that it is in the hands of the EU. That is a loss of sovereignty to which we referred over a number of treaties. These are a threat to our ability to make decisions in this Parliament in the interests of the Irish people.

For a short period, there was at least some good economic work under way in Europe. For a period after the banking crisis hit and caused many countries to slump into recession, several European countries led the way with stimulus packages aimed at lifting their economies out of contraction. Unfortunately, those on the right have once again deflected the rightly-placed blame on them for this mess and are leading a turnaround in policy decisions. They are holding Ireland up as a shining example of how to cut essential services, privatise, clamp down on workers' rights and allow the rich to carry on unscathed. It is an example of right-wing economics and of how to contract an economy into depression and apply the same policies that caused the crisis. Europe must be proud of us. We are repeating the mistakes of the past. That is how foolish this Government is and it is being led blindly by right-wing economists across Europe. This Government has always succeeded in taking the worst from Europe without any of the best. While we must adhere to the nonsense Stability and Growth Pact, we must have the worst health care system, the worst funded education system and the worst child care system. These services, so essential to building the State and competitiveness, are delivered with equality in most other European countries. It would serve us well if this Government was to look at Europe beyond its ideological slant and take a leaf out of other countries' books in that regard. It might find that if it puts its citizens and building competitiveness first, like other countries that frequently broke the Stability and Growth Pact, we too might have to adjust our goal of being within it.

Darragh O'Brien (Dublin North, Fianna Fail)
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There will now be a question and answer session that will not exceed 20 minutes.

Seán Barrett (Dún Laoghaire, Fine Gael)
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The President of the European Commission yesterday warned that the future of the euro depends on the implementation by the EU of stronger, stricter and broader governance of the financial markets, better co-ordination of member states' budgetary proposals and tougher sanctions for countries breaking budgetary rules. He was correct. The regulation of financial services was also discussed at the EU summit. It was agreed by the Heads of State to introduce systems of levies and taxes on financial institutions to ensure fair burden sharing and to increase incentives to contain systematic risk. Can the Minister of State outline how this will happen, who will monitor it and how it will be applied in respect of the Irish situation?

Can the Minister of State outline the national plan in respect of the five areas mentioned? What structures has the Government in mind to ensure inclusion in drawing up reform programmes? Is there a time schedule for submission to the Commission? Is work taking place on a parallel basis with the Commission and Ireland, similar to the targets set for climate change and emissions reduction of 20% by 2020? There were ongoing discussions leading to that target being agreed. Unfortunately, at the political level, in initial negotiations there was little contact at committee level or in plenary session about why it should be 20%. Much of this work is done behind the scenes between our Civil Service negotiators on behalf of the Government and the officials of the Commission. That is fine but others need to be included. Deputy Costello pointed out that we are discussing a summit that took place on 17 June when we should be discussing the proposals on the agenda for the next summit and the input, if any, of this Chamber on our stance on the items to be discussed. We should bear in mind that large commitments were given on the passing of the Lisbon treaty for greater inclusion of the views and ideas of national parliaments. Once the Lisbon treaty was out of the way, that desire seems to have been parked. I am not aware of any new structures to allow this Chamber to have a broad debate on various issues seriously affecting the citizens of this country.

Dick Roche (Wicklow, Fianna Fail)
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I will deal with the last point first. A great deal of work has been done on this point, particularly by the Joint Committee on European Affairs. The House must come to grips with this issue because this was one of the major points in the Lisbon treaty to which we all signed up. Deputy Costello also made this point. We signed up to it not because we wanted to get the treaty over the line but because it is inherently one of the most positive aspects of the treaty. There is a major challenge to all sister parliaments across Europe about how to use the facilities available. This is a challenge to the Houses of the Oireachtas, given our electoral system, our political culture and how we do our business. Deputy Barrett is correct in that this presents a major challenge because the material, the drafts and the legislation is coming to the Houses at the same time as to member state Governments. This presents a major task for the Houses. I agree with Deputy Barrett's earlier point about the need for restructuring. In a paper I delivered last week I went further by stating restructuring is not possible in the Houses of the Oireachtas until we examine our electoral system. This was a personal view, not a Government view. Our electoral system does not support the kind of House outlined by Deputy Barrett in his contribution and several times previously. Members can best serve the people if they can get away from day-to-day activities and focus more on how to deal with the future. While one cannot control the past, one can control the future. However, much valuable work is going on and, in particular, I recognise the contribution by Deputy Barrett's colleague, Deputy Durkan, in this regard.

The Deputy asked a series of questions with regard to the future and how, for example, economic governance will look in the Union in the future. The Van Rumpuy task force is addressing this issue and the first discussion on that has been held. The turbulence in the financial markets has proven that, notwithstanding Deputy Ó Snodaigh's little Ireland view of Europe, we would be in a devastating position. Moreover, it would not be just this small economy because, as most people are aware, small open economies are terribly vulnerable in times of turbulence. The question of how Europe deals with such turbulence and with economic imbalances is very much the focus of the Van Rumpuy report. I believe I have heard the Deputy refer at least once to the question of how Europe will deal in the future with issues such as the negative role played by credit rating agencies or how one should deal with hedge funds. These are matters that we will not be able to control from our focal point but we will be able to deal with it collectively in the future. Similarly, the Van Rumpuy task force is considering how budget procedures and budgetary discipline should be improved and what type of sanctions can be contemplated. This is because it is quite clear that when a situation arises such as occurred, for example, in Greece, where the statistical base simply did not reflect the reality, it poses a problem.

The Deputy also mentioned the issue of a levy and the question of oversight on banks. I agree there is a necessity for a common system throughout Europe and the Government has made this point. However, it also has made the point, because the Deputy touched on the issue of a levy, that a levy on financial institutions would be obliged to take account of banks' fragile position, particularly with regard to the timing of such an imposition, because any levy placed on a bank ultimately will be placed on its customers. These issues are in contemplation and this is where Europe has moved on.

A final point made by the three Members who are present in the Chamber is that it is important for the Houses of the Oireachtas and the debates therein to be more pertinent and more related in time to the decisions. During the past year, there has been a positive development in the committees, particularly in respect of the Joint Committee on European Affairs, whereby Ministers attending meetings, be it the Minister, Deputy Martin, or myself, must inform the joint committee as to what they intend to say and must return to the committee thereafter and make a quick report. This also would be a good practice in the other sectoral committees. However, while Deputy Barrett is correct to state that this a major challenge, matters are moving in a positive direction.

Darragh O'Brien (Dublin North, Fianna Fail)
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Just 11 minutes remaining in this segment for questions. I call Deputy Costello.

Joe Costello (Dublin Central, Labour)
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The first point is there must be a debate in this House before the Taoiseach goes to Brussels, rather than after the meeting. Of course it is possible to have a debate at both times but it is somewhat counter-productive for the only debate to be held after the event. A proposal to this effect has been made for some time and a document on it will be published soon. The Government should be proactive and should take on board the proposals that have come from the Joint Committee on European Affairs on this matter. Perhaps Members will be given a commitment that this will happen in the forthcoming Dáil session in the autumn.

Second, I refer to the question I raised previously about the fact that Europe is to have a spring semester to deal with budgetary matters. Should Members not take on board this proposal by engaging in prior debate on such matters before all 27 member states come together in Europe? The Minister for Finance and perhaps the Taoiseach and the other prime ministers will be outlining the broad parameters of their own budget strategies, without giving the details of course, in an attempt to co-ordinate the activities of the member states in budgetary terms. Before this takes place, surely there should be a major debate in this House on the national budgetary strategy and on the general thrust of what the Taoiseach and Minister for Finance will say in Brussels?

Third, the national reform programme is the key to the ten-year Europe 2020 strategy. Unless a proper programme is drawn up for the implementation of the strategy, the aforementioned five targets will be useless. There is an enormous amount of work to be done as this will be a ten-year strategy. The Government should come up with the broad parameters as quickly as possible but the House also must have an input in this regard because serious matters must be considered in each Department on issues such as climate change, education, research and development, employment or the target of 3% of GDP. How will they be implemented and how will the structures be put in place? Who will drive it and what mechanisms will be in place? All the sectoral committees of the Houses should be beavering away on these matters, in addition to whatever the Civil Service is doing. However, there is no sense in doing so in a vacuum and such matters must come before this House. The Minister of State should indicate what is the timescale for this programme to be ready and what inputs are envisaged.

Dick Roche (Wicklow, Fianna Fail)
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I will be brief. On the general point made by the Deputy about the Taoiseach or Ministers coming before the House in advance, I question the wisdom of trying to do all this in plenary session. I do not believe it to be the best way to deal with it.

Joe Costello (Dublin Central, Labour)
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No, not the Minister.

Dick Roche (Wicklow, Fianna Fail)
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I tend to agree with-----

Joe Costello (Dublin Central, Labour)
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Not the Minister. That is just for the spring semester.

Dick Roche (Wicklow, Fianna Fail)
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Very well. I was trying to deal with the three points made by the Deputy. If, to revert to the earlier point, more of this work is to be done in committee, the work of such committees must be better publicised. It is fundamentally wrong that, for example, the Oireachtas Joint Committee on European Affairs, which sits day in and day out, considers and tries to scrutinise legislation, at best gets ten seconds on Oireachtas Report some time after midnight. I consider this to be a fundamental breach of the responsibility of the public service broadcaster to keep the people informed. However, that is a bigger issue.

On the issue of the spring semester, I revert to the point made by Deputy Ó Snodaigh. The idea that there would be a team that would play according to rules does not constitute a breach in any sense of the sovereignty of any nation. While I agree that the spring semester is a good process, it is very broadly based and will not consider the specific detail.

As for the final point made by Deputy Costello on implementing the strategy, he is right because for all the strategies in the world, it always comes down to an implementation stage. In academic literature, it has been stated that implementation is always the Achilles heel. The responsibility on all Members on all sides of the House is to ensure they get on with the implementation process. I agree with the Deputy that the more specific are the targets, the better they are to judge. If targets are set in broad waffly terms, it is hard to ascertain whether they are being achieved. The best way to do it is to set targets in quantifiable terms of achievement over specific periods. This is a challenge we must face given our present position with regard to this process.

Seán Barrett (Dún Laoghaire, Fine Gael)
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If I may, I agree entirely with the Minister of State on publicising what happens in the Oireachtas, particularly with regard to European matters. I am sure the Minister of State will support the efforts made by many Members, myself included, who consistently have asked for the Oireachtas to have its own live broadcasting system. The Government should put its back behind this proposal to get it implemented as quickly as possible.

Darragh O'Brien (Dublin North, Fianna Fail)
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The Minister of State might deal with that as part of his wrap-up.

Dick Roche (Wicklow, Fianna Fail)
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While I can reply with the single word "Yes", I will come back to it during the wrap-up.

Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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I have a number of questions, which may be included in the wrap-up, on which the Minister of State can concentrate. The Taoiseach mentioned the Minister of State might elaborate on the points raised regarding the millennium development goals and the issue of Iran. I refer to the outcome of the discussions on sanctions against Iran. Alternatively, as expressed here, was a declaration made expressing concerns? That is far short of what, for instance, the United States has done. Is the Minister of State aware of whether meetings or negotiations have taken place with Iran by the European Union on that declaration subsequently?

I refer to what I consider to be a key strategy. I am one of the biggest critics of the European Union and some of the criticism is quite justified. The Lisbon strategy, as opposed to the Lisbon treaty, had quite far reaching social inclusion targets which were never met. That was one of the biggest failures of the strategy. In some ways they were an afterthought. Now, we have quite far reaching proposals on tackling poverty. Was there much opposition to agreeing the indicators to be used to measure poverty in the preparation of the 2020 strategy?

The Taoiseach referred to the Irish targets. When will we knuckle down and deliver on the target dates rather than the targets? I hope the information being used to set the targets is the latest available rather than being three or four years out of date. Given that we have gone through a recession in the past three years, if we use 2008 figures they would be well out of date and would in some ways be pointless.

Dick Roche (Wicklow, Fianna Fail)
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I will deal with the question on the millennium goals. The Council did discuss the situation in Iran and the major international concerns that exist because of its dealings with nuclear programming. The Council also issued a declaration, which is important, because it supports the concept of a negotiated solution and the continuing efforts of the High Representative. It would be dangerous to continue to isolate Iran. We must have dialogue, which is a two-way process. The tragedy is that at the moment the dialogue with Iran is a dialogue of the deaf as it is not willing to get involved. The declaration underlined the European Union's deepening concerns about the nuclear programme. It also welcomed the adoption of the UN Security Council resolution. The declaration invited the Foreign Affairs Council to adopt the accompanying restricting measures but the tenure of the discussion both in the Foreign Affairs Council and in the European Council has been to encourage Iran to have meaningful dialogue. That is the only way in the future both for Iran and the rest of the world.

Darragh O'Brien (Dublin North, Fianna Fail)
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I now invite the Minister of State to conclude the discussion and respond to the statements. Five minutes remain to him on this aspect.

Dick Roche (Wicklow, Fianna Fail)
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I thank Members. The exchanges at the end tend to be better than the set-piece speeches. I have been ignoring most of the set-piece speeches.

The European Council was the beginning of a new phase because it is implementing the processes that have been put in place in the Lisbon treaty. The gestation period of the treaty has been long. It is interesting that in facing the challenges the European Council has mapped a very ambitious route forward for Europe up to the year 2020. I prefer to use the title "the strategy for jobs and growth". I hate the jargon "Europe 2020", which means nothing to ordinary people. People want to know what Europe is doing about jobs and growth.

The Heads of Government have considered enhanced economic governance. It is critical that we have that. A small open economy such as ours does not have the capacity to influence the great movements but if we are part of Europe and engaged in it we become part of the process. The Council reviewed and pushed forward the financial supervision and regulation issues, which is something we will need to discuss in the committees in this House because they will be critically important in the future.

In the external relations area the leaders marked the continuing relevance of the enlargement with the decision that was made on Iceland. I very much welcome Iceland, a country with which we have historic connections. I look forward to the negotiations.

The Government very much welcomes the growth and jobs strategy. We believe that the strategy will provide an essential framework. Keeping the targets focused was the most important point. Deputies Ó Snodaigh and Costello and all who contributed referred to the Lisbon strategy. That strategy did not reach its targets because every time a meeting took place someone added a new target. It became like a Christmas tree that was overloaded with everyone's favourite bauble and it tipped over. Real progress can be made by focusing on five areas where we can make progress. The choice of targets is absolutely consistent with the desire to keep the strategy focused on areas that will make Europe relevant to the needs of citizens. It will provide an essential framework on which the European Union and the member states can work.

Climate change and the targets on greenhouse gas reductions were raised. A realistic discussion took place on those issues. Deputy Barrett adverted to the significant opportunities we face in this country. I agree with him. Issues arise in terms of interconnectors and grids. We discussed one of them in the House last night. We must get the entire infrastructure in place because we have significant potential, especially in wind and wave energy. If a fraction of the money which, for example, has been invested in nuclear energy research could be invested in clean energy technologies we would make real progress.

The summit made progress towards achieving the millennium goals and the role Europe will play in addressing the plight of the poorest people on the planet. This country is committed to the principle of reducing global poverty. The goals must be achieved universally. Deputy Ó Snodaigh inquired how one measures, for example, both internally within Europe and externally, issues relating to poverty. Even the worst critic of Europe would not ignore the fact that it is playing a significant role. Ending hunger, for example, was set as a bottom line. That must be something every civilised nation is prepared to work towards.

Israel and Gaza were mentioned again by two Deputies. Significant discussions were had on them at the Foreign Affairs Council on the Tuesday before the meeting. That has already been reported and discussed by the Oireachtas joint committee.

The European Council meeting was a very good day's work. It has given Europe a strategy for jobs and growth. It also deals with other priority issues such as regulating the financial services sector. It helped to orient the Van Rompuy taskforce in the job it has set to produce a better budgetary discipline with the Union and better prospects in the future.

Overall, we can expect more work in the European Council. It is likely to meet in this formation six times over a 12 month period. We have come through a period where crisis management was the main focus of Europe. I hope from here on in we can look at the post-crisis period and how we create jobs and strategies for growth. I thank Members for their contributions. If I did not address any specific issue raised that is particularly important to a Member I would be delighted to respond in writing.