Paul Murphy (Dublin South West, Anti-Austerity Alliance)
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It has been a very bad year for the political establishment in Europe. Former Prime Minister, David Cameron, is gone as a result of the impact of the result of the referendum on Brexit. President Francois Hollande will be gone as a result of his unpopularity as he is unable to stand even for the primary of the Parti Socialiste in France. Now, Prime Minister Renzi, the fresh-faced figure who was supposed to moderate austerity on behalf of all of us in Europe, is also gone, having been humiliated in the Italian referendum, in which his proposal was defeated by a vote of almost 60% against.

The Irish Government and every other European government would be loth to put any question to a referendum at this time for fear that people would take the opportunity to reject the political establishment. In advance of the referendum, various media outlets informed us of what was at stake. For example, The Independent in Britain featured the headline, "Italy goes to the polls in vote that could destabilise Europe". Another headline read, "The most dangerous moment for Europe since Brexit", featuring the caption, "Everything will change". Following the result, the Taoiseach informed the House that the European Union could deal with the outcome of the Italian referendum.

The Minister for Foreign Affairs and Trade said he does not see any comparison between this and Brexit and that this was not about the EU or the euro, which is a deliberate understatement of what this is about. The Government is attempting to hide and gloss over the fact that two major crises are exposed by the tremendous result in Italy yesterday. First, the political crisis of the establishment of Europe has not gone away but is deepening and Europe does not have respect or support among large sections of the population across Europe and, second, the banking crisis has not gone away. It was shoved slightly under the carpet in terms of some of the responses a number of years ago to the eurozone crisis and there was a failure to deal with the fundamental problems in the banking sector that are linked to problems in the real economy, as seen in Italy.

There has been an attempt, generally, to paint opposition to the EU austerity project as populism of the right, xenophobia, etc. That is also happening in terms of the Italian referendum and the attempts to point to this being related to the right populists of the Northern League, racists and so on. Any analysis of the vote shows that is not the case. Those who were opposed include right populists but the dominant forces were the left of the democratic party, left-wing political parties, left-wing trade unionists, such as the CGIL, and young people. Some 81% of those aged 18 years to 35 years, the low-paid and people from the poorer south rejected the policies pursued by former Prime Minister Renzi, which were anti-worker, anti-popular policies such as the labour reform law, the counter-reform in education and the rejection of the centralisation of power attempting to ride on a wave of anti-political populism.

There is a lesson here for the political establishment in the European Union. It was summed up in an article in The Financial Timesby Wolfgang Münchau as the Marie Antoinette moment for Europe's elite. These people are unwilling to see the reality of what is happening and the extent of the disillusionment with Europe's political and economic system and respond with something that is akin to "let them eat cake", for which it will pay the price again and again. There is a significant left force building that can instead transform the Europe that we have and fight for a very different type of Europe, a socialist one that works in the interests of the minions.

Joe McHugh (Donegal, Fine Gael)
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Gabhaim mo bhuíochas leis an Leas-Cheann Comhairle fá choinne an tseans labhairt fá dtaobh den reifreann san Iodáil agus ráiteas gairid a dhéanamh air don Teach. I am pleased to have this opportunity to make a short statement to the House on the recent referendum in Italy. Italy is a leading member of the European Union. It is a founder member and the third largest economy in the eurozone. Italy and Ireland enjoy excellent relations, including a strong economic and trade relationship and this will continue. We have worked closely with outgoing Prime Minister Matteo Renzi over the past few years bilaterally and within the European Union and we wish him every success for the future.

The Italians went to the polls on Sunday, 4 December, to vote on proposals for constitutional reform, proposed by Mr. Renzi. By a majority of 59% to 41% the referendum was defeated. Mr. Renzi resigned but will remain on as Prime Minister at the request of President Mattarella until Italy's 2017 budget is approved by parliament. What happens then is a matter for the President who will have to decide whether to put a caretaker government in place or to call a general election. The Italian political system will inevitably need some time to take stock and agree a way forward.

Under the current system, there are two Chambers of Parliament with directly elected lawmakers, the Chamber of Deputies and the Senate. Both Chambers have equal power and must agree on legislation before it is passed. Under the reforms proposed by Mr Renzi, the Senate would have lost most of its powers. The number of Senators would have been reduced from 315 to 100 and the remaining Senators would no longer have been elected directly. Under the proposals, most laws could have been passed by the Chamber of Deputies - the lower house - alone. However, the upper house would have had to be consulted on major issues such as other constitutional reforms and the ratification of EU treaties.

I note positively that following the referendum result the euro remains broadly stable and there has been a relatively muted market reaction to the result. It is, of course, important that we continue to monitor events closely in the aftermath of this result. As the Minister for Finance stated yesterday, there are no contagion effects from the Italian banking system to the Irish banking system. It is important to note that this referendum was about internal constitutional reform in Italy and not about support for the European Union. In this sense, it is entirely different from the UK referendum in June. The only political parties which took an explicitly anti-EU line during the campaign, and after the results, have no more than 15% of the vote. The 59% of "No" voters will certainly have included people who are pro-European but just did not support the proposed constitutional reforms, such as the former Prime Minister and EU Commissioner, Mario Monti.

As the Taoiseach said yesterday, it is important to note that the parties opposed to the referendum, such as the Northern League, the Five Star movement and Forza Italia, did not agree with each other on a range of other issues. We are well aware in this country that referendums can have surprising results, often not fully connected to the stated objective of the vote. There is no doubt that in many western democracies there is a lack of faith in political and other institutions. This is not by any means confined to the EU, but it very much recognises the need to respond and this is the subject of ongoing debate at the highest levels. However, I agree with the Taoiseach’s remarks yesterday expressing confidence that the EU is big enough and strong enough to deal with the fallout from the referendum result.

Italy is a country of immense creativity and resilience and I have every confidence that its political leaders will deal with the current situation.

Paul Murphy (Dublin South West, Anti-Austerity Alliance)
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I have zero confidence that the political establishment across Europe will learn any of the lessons from this. As stated by Wolfgang Münchau:

Some revolutions could have been avoided if the old guard had only refrained from provocation. There is no proof of a "let them eat cake" incident. But this is the kind of thing Marie Antoinette could have said. It rings true. The Bourbons were hard to beat as the quintessential out-of-touch establishment. They have competition now.

This is what we have seen and are going to see again and again. If people choose to interpret the referendum result in an extremely narrow way then they are missing the process that is happening. I would draw a distinction between the defeat of FPO candidate, Mr. Hofer, in Austria, which shows that the outrage does not have to lead to the rise of the radical right, and the defeat of this referendum in Italy. To say that there is no problem in this regard in terms of knock-on effects to the banking system is to ignore what is happening and the dangers arising therefrom. The term "La Sofferenza" which means "the suffering" is used in regard to non-performing loans. Some 18% of loans from Italian banks are non-performing loans, which is primarily linked to the bad performance of the Italian economy and the weakness of the small and medium enterprise sector in particular. The amount of non-performing loans increased from €42 billion to €170 billion from 2008 to 2014 and since then has risen to €360 billion. At the centre of this is the Banca Monte dei Paschi di Siena, which has to raise €5 billion this week in capitalisation. The result of this referendum has created a huge crisis. Not only is the Banco Monte dei Paschi di Siena under threat, so, too, are Unicredito and Banco Popolare. If they go under or if there is a bail-in - all these things are possible in Italy - it will have a massive impact on Ireland owing to the weakness of the Irish banking system, as evidenced from its performance in the latest Frankfurt stress tests. The banking crisis has not gone away and neither has the economic crisis. The political crisis has intensified and the Italian referendum result will re-expose all those things.

Joe McHugh (Donegal, Fine Gael)
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It is important that we avail of this House to have these conversations. In regard to referenda, we all have anecdotal examples of why people vote in particular ways, from which we can draw our own conclusions. Following the children's referendum when I asked a man why he had voted "No", he responded that he had done so because the "No" option was on the ballot paper, which shows his vote had nothing to do with the children's referendum.

In terms of the Italian referendum result, whether or not there will be a general election in Italy is a matter for the Italian President. We need to look at what is happening outside of the European Union. We live in a world in which 65 million people are displaced, of which 9 million are from Chad in sub-Saharan Africa.

Some 25% of all the refugees in Italy come from Eritrea. There is fear over what the future will hold. People think about the next generation and struggle with the question as to what the world will be like in 20 or 30 years. The population of Africa is to double in 20 years, from 1.2 billion to 2.5 billion. This will have a knock-on effect at European level.

A major conversation is needed but I guard against the politics of fear. There is a lot of fear, as expressed in many referendum campaigns over the years. We need a big conversation on demographic trends, population increases and projections for the future. Kenya, for example, will produce 1 million extra people for the workplace each year. This is but one country in the Continent of Africa. We have to be conscious of these demographic trends but we must also allow the space in which to have these conversations in this House because Ireland has an important role to play.