John Halligan (Waterford, Independent)
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Question 7: To ask the Minister for Finance if he will report on the recent Ecofin meeting; the issues he raised and in particular any measures that were raised to promote economic growth in Europe; and if he will make a statement on the matter. [25658/12]

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Question 12: To ask the Minister for Finance if he will report on the recent Ecofin meeting; the issues he raised and in particular any measures that were discussed to promote economic growth in Europe; and if he will make a statement on the matter. [25656/12]

Michael Noonan (Limerick City, Fine Gael)
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I propose to answer Questions Nos. 7 and 12 together.

I attended the meeting of ECOFIN on 15 May 2012 at which the following were the main points. Ministers reached agreement on two legislative proposals to amend existing EU rules on capital requirement for banks and investment firms. The objective of the proposals is, inter alia, to ensure that the effectiveness of the regulation of credit institutions and investment firms in the EU is strengthened and that financial stability is enhanced. These proposals also aim to transpose into EU law the agreements reached by the Basel Committee on Banking Supervision, that is the Basel III requirements, as endorsed by the G20 leaders. The Danish Presidency can now start negotiations with the European Parliament, the aim of which is to reach agreement, if possible, by June.

Ministers also discussed a draft Council decision to authorise the Commission to begin negotiations with five non-EU third countries - Andorra, Liechtenstein, Monaco, San Marino and Switzerland - to revise agreements with those countries on the taxation of savings income in order to ensure the continued equivalence of measures in those countries with the EU savings tax directive. While unanimous agreement on a mandate for the Commission was not reached, work will continue on this issue before the Presidency reports on tax issues to the European Council in June.

Council conclusions on the sustainability of public finances in light of ageing populations were adopted, as were Council conclusions on fast-start financing of climate change measures.

On its presentation of the draft EU budget for 2013, the Commission highlighted the importance of the EU budget as a driver of growth and jobs. During the subsequent exchange of views, the importance of the EU budget as an instrument for promoting growth in Europe was highlighted.

The Taoiseach has been very strong on supporting and advancing pro-growth measures at EU level. In preparation for the late-June European Council, President Van Rompuy is hosting an informal meeting of EU leaders this evening to discuss how growth and jobs can be boosted across the EU.

We all agree that a strong resumption of growth is critical for Ireland. I would point out that fiscal sustainability and measures to promote economic growth are not necessarily incompatible. My view is that measures to boost the economic growth rate can play an important role in addressing the current crisis in the EU. During a discussion on growth policies at ECOFIN I drew attention to the recent programme review mission during which we sought to strengthen the focus of our programme on growth measures. Working with our troika partners, we will continue to stress the importance of the growth agenda to the overall success of the programme.

Furthermore, I am continuing to explore all options that can enhance the growth agenda. In the margins of ECOFIN last week the Minister for Public Expenditure and Reform and I met senior officials from the EIB to explore mechanisms to access additional funding for investment in the Irish economy. All options are being explored to secure support for appropriate projects, for example, primarily schools and primary care centres. These projects will help generate jobs and growth in the economy.

We have committed to a substantial capital programme of €17 billion for the period 2012-2016 already. The intention is to complement this programme with additional projects funded through various potential sources - funds from the EIB, proceeds from the sale of state assets and use of some of the remaining funds of the NPRF. Significant progress has been made on many fronts specifically on the use of proceeds from the sale of State assets to be used for a domestic stimulus package. The Government is committed to getting the economy back on track and taking every opportunity to explore all options to advance the Government's agenda of jobs and growth both domestically and at EU level.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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I must put it to the Minister that yet again deception is being exercised on our people, particularly in advance of the vote in the referendum on the fiscal treaty. Members of the Government are talking about and using the word "growth" a good deal. We have heard its use again by the Minister, the Taoiseach uses it a good deal and there is good deal of talk about it around the European Council summit. However, in practice, we get austerity.

According to the German newspaper, Der Spiegel, at the ECOFIN meeting referred to in the questions, the Minister was reported as having berated the Greek Government for failing to robustly enough impose austerity on the Greek citizens. These are the same Greek citizens who have been massacred with cuts under austerity-----

Michael Kitt (Galway East, Fianna Fail)
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A question, please, Deputy.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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-----and whose economy has been destroyed with the imposition of that austerity. Is it not the case that this taken alongside the insulting comment the Minister made about feta cheese, which was insulting to the Greek people who are suffering, are not only insulting to the Greeks but indicate the Minister's Government is still, along with Angela Merkel, promoting the austerity agenda, which has crippled growth and done such damage to the lives of ordinary citizens here and across Europe, instead of seriously addressing the question of growth, which requires an end to the austerity agenda and real investment in putting people back to work? The Minister is playing something of a double game in talking about growth on the one hand and arguing for austerity on the other hand, particularly when he is over in Europe with his EU partners.

Michael Noonan (Limerick City, Fine Gael)
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The comments attributed to me in Der Spiegel are totally and completely untrue. The Greek Finance Minister came up to me after my contribution and thanked me personally for my support in the course of the meeting. I do not know who did the spinning but it was the opposite of the views I expressed that appeared in Der Spiegel.

On the other issue about the level of trade between Ireland and Greece, to which the Deputy referred, if one is communicating to an international audience, as I was at a Bloomberg conference when everything was going out live online, and one runs a bundle of statistics at the audience, they do not know what one is talking about. I made a very simple point that it is unlikely there will be contagion from Greece to Ireland because the links between Greece and Ireland are very limited both on imports and exports and in banking. I used an image as there were many people in the audience. I said that if one is in a supermarket how many items produced in Greece would one have in one's shopping basket? I think that is a reasonable way to get an image across, especially to an international audience of investors, particularly in the United States, who quite frequently put Greece, Portugal and Ireland all in the one category. As we have said on several occasions, there are very little similarities between the Greek economy and the Irish economy. If one looks at the statistics, our exports to Greece are less than 0.5% of our total exports and our imports from Greece are less than one tenth of 1% of our total imports.

Michael Kitt (Galway East, Fianna Fail)
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I ask Deputy Boyd Barrett to be brief as two of his colleagues wish to contribute.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Does that analysis not show a very simplistic and inaccurate understanding of what the consequences would be if there was a Greek exit from euro pushed by the austerity that has been imposed by Europe? All the commentators, even the person who negotiated the Greek write-down of debt, have pointed out that we could face a much deeper recession if Greece is forced out of the eurozone to the degree that output across Europe could drop by 5%. To suggest that the only impact would be sales of feta cheese is utterly simplistic, trivialises the issue and not to mention is insulting to the Greek people who are suffering so much. Is it not the truth and a more accurate analysis that if Greece were forced out of the euro because of the determination of Europe to shove more austerity down its throat, that it could plunge Europe as a whole from recession into depression and trigger contagion right throughout the periphery and into the core of the Europe economy?

Michael Noonan (Limerick City, Fine Gael)
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I have dealt with all those issues as well. If the Deputy looks back at an interview I did in Brussels on Monday, which he can pull down on the RTE website, he will note that I dealt with all the wider issues. While I was not as alarmist as the Deputy was, I acknowledged the fact that there is a major problem in the eurozone at present because of the situation in Greece, but I was dealing with a different agenda at the Bloomberg conference - I was showing that the economic and banking connections between Ireland and Greece are very limited. I was doing it at a point where our nine year bond rate was moving up to 7.5% because there was a perception of a direct contagion effect. The effect is not a direct contagion one; the effect on Ireland is the consequences of a crisis in the euro because of the situation in Greece, and I have dealt with that. I understand the position in so far as anybody understands it, but the Deputy should not ascribe to me views which I do not hold.

Pearse Doherty (Donegal South West, Sinn Fein)
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I want to try to get an answer to this question. I asked about the report on more cuts and tax increases and reference was made to the chairman of the Irish Fiscal Advisory Council, Professor John McHale. I asked about the structural deficit given the plans to make an €8.6 billion adjustment over the three years. In particular I asked what the automatic correction methods would entail. The Minister did not answer any of these questions. The Minister speaks about growth and about Greece. It did not do him any justice at the Bloomberg conference to laugh about putting feta cheese in shopping baskets. If it was intended to have an effect it did not work. Last night another rating agency put Ireland on negative watch. Investors are not stupid.

The Minister spoke about growth and mentioned infrastructure projects and schools. How can the Minister speak about this? Last year he and his colleague, the Minister for Public Expenditure and Reform, Deputy Brendan Howlin, announced that €7.2 billion would be taken from the capital budget between now and 2016. The Minister speaks about €17 billion with regard to capital but he forgets to state this is a reduction of €7.2 billion.

How much of the €300 million we lent to Greece does the Minister expect the country to get back if Greece exits the euro?

Joe Higgins (Dublin West, Socialist Party)
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If I understood the Minister correctly, he stated the EU Commission would allow this country to work out its own method of arriving at what the structural deficit will be. What will it be in 2015 and onwards? With regard to growth, the Minister mentioned many structural adjustments and mentioned 150,000 former construction workers who should be retrained to find their way back to work. I concur with this but does the Minister agree unless major investment is made in the economy these workers can be retrained to a high degree but they will not find jobs? This type of investment is critical. Does the Minister agree corporations are sitting on €2 trillion of uninvested profits in Europe and this is a massive problem? Public investment is required. What will the EU do about this?

For the sake of clarity the Minister should correct what he stated earlier. Does he acknowledge that Article 3 of the ESM treaty means any country whose crisis could destabilise the eurozone will have access to funds and this will take precedence over a recital? In particular the Minister should correct the fact he stated the Irish Government does not have a veto over the ensconcing of the ESM treaty in EU law. Why did the prime ministers and presidents come up with an amendment to Article 136 of the Treaty on the Functioning of the European Union to do just this if it is not required?

Michael McGrath (Cork South Central, Fianna Fail)
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We all welcome the renewed focus on economic growth and measures that can emanate from Europe to assist us in this regard. However, the question as to where is the beef will arise very soon. What are we looking at in practical terms from European initiatives rather than from the proceeds from the sale of State assets? Will it involve expanding the role of the European Investment Bank or additional Structural Funds for Ireland? How will Ireland benefit in a tangible way from the European discussions on the growth agenda?

Michael Noonan (Limerick City, Fine Gael)
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My view is that the talks in Brussels will not conclude tonight because, as the Deputies are aware, French parliamentary elections will take place in June and the party of the French President will campaign on the basis of a jobs and growth agenda and any agreements with colleagues in Europe will be arrived at after the elections. I believe this is how it will play out. I see Deputy Higgins smiling, but he understands politics as well as I do.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Pie in the sky.

Joe Higgins (Dublin West, Socialist Party)
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The Minister can give his colleagues in the Labour Party a few tips.

Michael Noonan (Limerick City, Fine Gael)
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What I am saying is not pie in the sky. There has been a change in the debate in Europe and it is being driven by France. It is impossible to state at this point what the tangible results will be. There certainly has been at a minimum a huge change in emphasis and a very strong commitment to pursuing a jobs and growth agenda in parallel with balancing budgets in the member countries.

When Deputies speak about growth the bit they always leave out is that it must be sustainable growth. If we had €4 billion tomorrow we could get the economy growing through establishing building projects throughout the country in a Keynesian intervention. One would not quite dig holes and fill them up again, as Keynes said on one occasion, but one could find projects. However, when the money ran out they would stop and those employed would be unemployed. It would be boom and bust, and the boom and bust model has been tried in Ireland time out of mind. We need sustainable growth whereby we get the conditions for growth right and grow for 12, 15 or 20 years. This is the type of model which has been successful in other countries. We must get away from the boom and bust model. This means examining every project in the stimulus package and investing only in those which actually contribute to enhancing the infrastructure to allow the economy to grow stronger. One does not invest in projects which are purely employment creation projects.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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It is not happening. Where is the investment?

Michael Noonan (Limerick City, Fine Gael)
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This is how the growth and jobs agenda will be developed and this is what the Government will do.

Pearse Doherty (Donegal South West, Sinn Fein)
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On a point of order I have asked five questions to which I have not received an answer. I am trying to make the questions quite simple. I do not want to be shouting over the Minister and I am sure he does not want that either as people are probably listening to this debate. I ask the Minister to try to answer the questions. This is supposed to be Question Time.

Michael Kitt (Galway East, Fianna Fail)
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The Ceann Comhairle and I have stated previously that any issues must be taken up with the Ceann Comhairle's office. I will say no more than this.

Joe Higgins (Dublin West, Socialist Party)
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The Minister should make a note of the questions as they are asked. He remembers only the final one.

Michael Noonan (Limerick City, Fine Gael)
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I remember them alright but I am constrained by time. If I have time to answer only two I cannot answer 20. It is simple arithmetic.

Joe Higgins (Dublin West, Socialist Party)
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The Minister could have corrected himself on the ESM.

Michael Noonan (Limerick City, Fine Gael)
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I had already answered that question. There is no point in answering the same question twice.

Joe Higgins (Dublin West, Socialist Party)
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You answered it wrongly.

Michael Noonan (Limerick City, Fine Gael)
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You did not like the answer and you want me to give a different one.

Joe Higgins (Dublin West, Socialist Party)
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I explained to you why you were wrong.