Wednesday, 24 June 2020
Post-European Council Meetings: Statements
Before I make my statement I want to endorse what was said earlier about the death of Detective Garda Colm Horkan. The remarkable outpouring of grief we saw over the weekend says a lot about our values as a country and the respect we have for the men and women who uphold our laws. Whenever we lose a member of An Garda Síochána in the line of duty, it wounds us all and we grieve as a nation.
At the funeral, Colm's brother Brendan remembered his achievements on the sporting pitch and said he never let the jersey down. Exactly the same thing could be said about his career as a garda. He never let the uniform down. He never let us down, the people he had sworn to serve. Our condolences go to his family and friends, the people of Charlestown and the members of An Garda Síochána. Ar dheis Dé go raibh a anam dílis.
On Friday last, in lieu of a regular June European Council meeting, I participated in a videoconference of Heads of State and Government. The main focus of the discussion was the Commission's proposal of an EU-wide recovery instrument known as Next Generation EU and the EU's seven-year budget for the period from 2021 to 2027, the multi-annual financial framework, MFF. As a package, these are policies to enable our economies and societies to recover from the unprecedented challenges of the crisis caused by Covid-19 as well as the drive to the digital and green transformation of our countries and continent.
We also received a report from the President of the European Council, Mr. Charles Michel, and the President of the European Commission, Dr. Ursula von der Leyen, on the high-level conference with the UK Prime Minister, Boris Johnson, which took place on 15 June. In addition, Chancellor Angela Merkel provided an update on the implementation of the Minsk Protocol and the situation in eastern Ukraine and the occupied territories in Crimea.
The House may be interested to know that on Thursday 18 June, I joined the videoconference of the eastern partnership summit, which brings EU leaders together with our counterparts from six countries to our east: Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine. The meeting underpinned the strategic importance of this relationship. In her wrap-up remarks later, the Minister of State, Deputy McEntee, will provide further detail on that summit and developments in eastern Ukraine.
Friday's videoconference opened with a presentation by the President of the European Parliament, David Sassoli MEP, who expressed the European Parliament's support for an ambitious recovery fund. We were also briefed by the President of the European Central Bank, Ms Christine Lagarde, who provided us with an overview of the economic situation in the European Union. Her assessment was stark. The damage caused to the European economy by the Covid-19 crisis has been considerable and will be lasting. Her assessment is that it will take until late 2022 for the European economy to recover to pre-crisis levels. She predicted that the worst effects on our labour markets may be yet to come and are likely to affect young people and those in the private sector disproportionately.
At our last meeting in person in February, the European Council was unable to reach a consensus on the proposal for the MFF then on the table. At that time, the enormous consequences of Covid-19 for Europe were not yet known. However, in the months that have followed, the scale of the challenge we are collectively facing has become more apparent. On 23 April we agreed to task the European Commission to make a proposal for an ambitious recovery fund equal to the scale of the challenge, as well as a revised proposal for the MFF. Following that request, on 27 May the European Commission published a package for economic regeneration. This included a revised proposal for a European recovery instrument, Next Generation EU, to run over the period from 2021 to 2024, and a revised proposal for the MFF. The total package is worth €1.85 trillion in 2018 prices. That breaks down as €1.1 trillion for the MFF and €750 billion for Next Generation EU. The Commission proposed that the recovery instrument should be funded through one-off borrowing on the financial markets on behalf of the Commission as an exceptional measure in response to the unprecedented circumstances we now face. This would be achieved by temporarily lifting the own resources ceiling to 2% of EU gross national income. This additional funding would then be channelled through EU programmes and repaid over a long period of time, starting in 2028 and running until 2058.
Our discussion on Friday was the first opportunity for leaders to exchange views on these very substantial proposals. I had already set out my views in a telephone conversation with European Council President, Charles Michel, earlier in the week. On both occasions I emphasised that we welcomed the broad thrust of the proposals and the Government's support for an EU response that demonstrates solidarity with those regions and sectors most affected by the pandemic. I also emphasised the scale of the impact that the crisis has had on Ireland, our economy and our employment levels, and the need for this to be reflected properly in the assessment of needs and the related allocation key for any new funds. The metric against which grants and loans should be allocated is the extent to which a country has been impacted by Covid-19, not its past economic performance or its ability to bounce back from a crisis. On the MFF I reiterated that we were open to contributing more to the new budget but only if this protected our vital interests as a country, especially in regard to the Common Agricultural Policy, CAP. The issues which were important for Ireland before the crisis, namely, CAP, cohesion, climate, the Single Market, research and innovation, are even more important now as the country seeks to recover from an unprecedented and sudden shock to the system.
We must also use this opportunity to set Europe on the right path for the future by building a greener, fairer and more resilient, digital and sustainable European Union. As everyone in the House will agree, the CAP is an important, long-standing and well-functioning policy and a vital support to our rural communities, rural economy and farm families. Wider than that, for decades it has also assured all Europeans of a secure and affordable food supply, something we should not take for granted and something not taken for granted in other parts of the world.
Despite the increased allocation for rural development under the recovery proposal and the increased allocation for the CAP in the revised MFF, I said that what was now on the table was not acceptable to Ireland and does not yet meet the test of ensuring adequate funding into the future. Our farmers are experiencing considerable difficulties with exports and prices collapsing as a result of Covid, global disruption to trade routes, Brexit and increased competition from third countries. As we increasingly talk about Europe's resilience, we need to underpin a strong agri-food sector that will provide Europe with food security and help us to achieve our climate goals as well. A strong and properly funded CAP is needed to achieve this and we can settle for nothing less.
I also said that Brexit will affect Ireland disproportionately. Whatever the outcome of the ongoing negotiations, we will be affected more than other countries are and any recovery instruments should be designed to respond to that. It is apparent that at the end of the year, the United Kingdom will leave the period of transition now in place and begin to trade with the European Union as a third country. While I very much hope that this will be on the basis of a comprehensive free trade agreement, it will still mean a disimprovement in trading conditions for Irish exporters. Were the UK to leave the European Union - or, rather, were the UK to leave the transition - without a trade deal in place, the consequences would be especially severe for Ireland, which is the most exposed member state.
From last week's discussion, I believe leaders are committed to reaching an agreement, ideally next month, but significant differences exist and it will not be an easy task to find consensus. There are some areas of convergence. We agree that there should be an exceptional response at EU level to the Covid crisis, it should be financed through the European Commission's borrowings, the funding should be temporary and targeted at the sectors and regions most affected, and the MFF should contribute to the reform and transformation of our economies and societies. However, thinking is not yet aligned on a number of questions. One of these is whether the recovery package should provide only for loans or whether it should be a mix of grants and loans, whether it should deal only with the direct impact of Covid-19 or also pre-existing disadvantages and imbalances, whether conditions should attach to the fund and, if so, which ones, how much the fund should be, and how quickly loans should be repaid. These issues will not be easily resolved in July. None the less, we all expressed a willingness to work together in an intensified way to reach a conclusion at a meeting in person next month. In the coming weeks, President Michel will engage in consultations with all member states before tabling a revised proposal ahead of the meeting in mid-July.
While the primary focus of the meeting was the MFF and the Next Generation EU fund, Presidents von der Leyen and Michel provided a readout of the high-level conference on Brexit that took place with Prime Minister Johnson on 15 June. At that conference, they took stock of the limited progress made to date in the future partnership negotiations. In a joint statement afterwards, both sides agreed to intensify negotiations with a view to building new momentum. Both sides also confirmed their commitment to the full and timely implementation of the withdrawal agreement, including the protocol on Ireland and Northern Ireland. I thank Presidents von der Leyen and Michel and the Union's negotiator, Michel Barnier, and his team for their continued skill and measured handling of these negotiations.
I believe that a deal with the UK is still possible and I expressed my hope that an intensified engagement over the summer will reveal the landing zone for an agreement. I was among several leaders to acknowledge the importance of early and comprehensive contingency planning, given the possibility of no trade deal on the future relationship being reached. Any deal will entail significant disruption to our supply chains, business models and market access and a significant impact on the cost of doing business with the UK. We need to be wise to that. It will also impact our fishermen and seafood industry. The arrangements we have now in this regard cannot possibly be as good in the future.
I also took the opportunity to thank the leaders for their friendship and solidarity with me as Taoiseach and with Ireland as a country over the past three years, particularly when it came to Brexit. I wished them well in the difficult and challenging days ahead.
I begin by joining with the Taoiseach and Deputies who earlier today led tributes to Detective Garda Colm Horkan in expressing our deepest sympathies to his family, friends and wider community. In the days since his murder, people throughout our country have taken the time to show their respect for him and for the forces of law and order which protect us. All who knew Detective Garda Horkan have spoken of a good and decent man, a man rooted in his community and a man rooted in the joy of sport. He was deeply proud to serve in the uniform of this free Republic. His terrible murder has reminded us all once again of the dangers faced by members of An Garda Síochána as they go about their duties. It challenges us all never to take them for granted. Ar dheis Dé go raibh a anam dílis.
Before I move on to the specific issues arising out of last week's virtual summit, I would like to mention Ireland's success in being elected to a place on the Security Council of the United Nations. This is the fourth time we have been chosen by the other members of the United Nations to serve on the council. It was an impressive and comprehensive campaign for which everybody involved deserves congratulations. Fundamentally, as has been the case each time we have received this recognition, the foundation of our success rests on the incredible work of the men and women of Óglaigh na hÉireann and our diplomatic service. Over many years, they have shown unmatched bravery and dedication in the promotion of the visionary and humanitarian ideals on which the United Nations was founded. Eighty-six members of Óglaigh na hÉireann have lost their lives while serving on United Nations missions and every country that belongs to the UN knows of their heroism. It is right that we remember and honour them for the high international standing they have given to our country. Equally, we should acknowledge that our diplomats have an outstanding reputation for their ability to work tirelessly with others to bridge gaps and serve shared interests.
Our record of being an active and positive member of the United Nations was established within a few years of our becoming members in 1955. Whenever the UN has looked for countries willing to promote peace and to fight famine and poverty, Ireland has always responded quickly. During Frank Aiken's time as Minister for External Affairs and during our first membership of the Security Council, Ireland took a leadership role on vital issues such as nuclear non-proliferation and the test ban treaty. This engagement has continued over the years, including in our work on the ban on cluster munitions, which we negotiated in 2008 in an agreement that was concluded at a summit held in Croke Park. This tradition of positive diplomacy and promoting true multilateral co-operation must be as important to our work in our two years on the Security Council as it has been during our entire membership of the United Nations. At a moment in history when human rights are once again under threat throughout the world and the need for co-operation and respect has never been clearer, an effective United Nations is desperately needed. Ireland must do everything it can to make a positive difference in that regard.
Last week's virtual European Council summit was never likely to reach agreement on the core issues on its agenda. However, it does appear that there is substantive engagement and that progress is possible next month. The proposals for a major new recovery instrument to help members of the European Union are very welcome. Twelve years after the absence of a larger fiscal capacity was exposed as a major flaw in the design of the economic and monetary union, there are finally concrete proposals to create new funding programmes. Over the past eight years and during the recent election, Fianna Fáil has consistently supported calls for increasing the Union's ability to actively support economic recovery, the transition to a low-carbon economy and new opportunities for those being left behind, particularly because of technology. President Macron's speech three years ago calling for a transformation in the Union's ability to deliver collective action was, unfortunately, resisted by many countries. That it took an unprecedented pandemic to shift the debate is a sign of the implacable opposition which these necessary developments have faced. What is being proposed deserves much greater attention in public debate because it is a significant step towards delivering a European Union that can become a more active enabler of urgent change.
The Commission's initial proposal is to combine effectively the standard multi-annual budget with new funding, which will be a combination of grants and low-cost, long-term loans. At least initially, this new funding is due to help countries worst hit by the pandemic and the recession it has caused. In comparison with the agenda as it stood as recently as February, this represents a radical change.
Chancellor Merkel's support has once again shown her capacity for brave and ambitious decision-making, while President Macron's continued passionate advocacy for a Europe strong enough to take on the challenges of today has persuaded many former opponents of change.
My party welcomes Ireland's decision to support the new recovery instrument in principle. It marks a move away from the position of last year and marks an important change of direction in our policy. The proposal as it stands has serious problems. Much more work appears to have gone into the financial engineering behind it than ensuring a fair and effective allocation of funding. If the first priority is to support sustainable recovery where the pandemic has had the worst impact, it seems foolish to try to decide allocation before the impact of the pandemic is fully understood. Data published yesterday in France were very encouraging, but it is completely uncertain what the medium or long-term impact will be. This is particularly true of economies where tourism is a major industry.
Before the current budget negotiations began, it was agreed that measures must be taken to ensure we end the practice of governments taking European Union funding yet aggressively undermining the liberal democratic principle to which every member state signed up when joining. It would be unacceptable for this new recovery instrument to be distributed without regard for respect for the rule of law, media freedom, and the agreed sustainability objectives of the Union. In the context of the seven-year budget, the continued attempt to take money away from certain areas to create space for others must be resisted. The only reason there is pressure on the Common Agricultural Policy is an ongoing zero-sum approach to negotiations. The move towards a CAP which encourages diversity of supply, rural development, and environmental sustainability can only be achieved if the budget is protected.
The lack of a dedicated Brexit transition support programme is a concern. The proposals to raise more dedicated revenue for the Union is something we support in principle. However, there are real limits to what is acceptable. Under no circumstances should the need for these revenue options be mixed with the entirely separate and questionable search for harmonisation. Any serious attempt to attach different agendas to the recovery instrument will undermine its legitimacy and delay agreement.
With regard to Brexit, the lack of progress on trade negotiation is a major concern. The position of the London Government has not inspired hope that we can avoid major economic disruption in January. At the very least, it does not appear to be accepting the proposals made last year as the basis for a permanent agreement. There is no positive purpose to be served by spending time now questioning its motivation and tactics. What we can do is to state once again that the core principles adopted by the European Union are founded on the perfectly reasonable basis that one does not get to pick and choose which elements of the Single Market one respects.
Now that the blockade of the Northern Ireland Assembly has been ended, the representatives of the people of Northern Ireland have been loud and clear in calling for London to respect their wish for enough time and space to be allowed for negotiations. They quite rightly object to arbitrary limits on the transition being imposed by London. In terms of our preparation for Brexit, the situation in January was that we were not ready for a possible WTO trading relationship with Britain. In tandem with support for recovery from the impact of the pandemic, we need an urgent programme for making sure that, at the end of this year, Irish companies are ready and supported to survive whatever happens once the transition ends.
This is a moment for the leaders of Europe to act decisively. We face historic challenges. We must help our economies and societies to recover. We must chart a new direction in the years ahead which delivers transformational change for our environment and economies. We must show that free democracies can survive and succeed, even when facing the most extreme pressures. This was not a decisive summit, but it was part of a new direction which Ireland must play a central role in supporting.
Léiríonn sé an treo ina rachaidh an Comhphobal sa todhchaí. Ní neart go cur le chéile. Caithfidh baill an Aontais Eorpaigh teacht le chéile go láidir ionas go mbeimid in ann déileáil leis an ngéarchéim seo de dheasca Covid-19. Is léir go bhfuil agus go mbeidh drochthionchar ag Covid-19 ar chúrsaí eacnamaíochta agus ar chúrsaí sóisialta na hEorpa. Comhobair is ea an tslí is fearr chun na fadhbanna a bhaineann le Covid-19 a réiteach.
I too wish to extend our heartfelt condolences to the family of Detective Garda Colm Horkan and extend sympathies to his colleagues in An Garda Síochána, to his wide and extensive group of friends and families in Cumann Lúthchleas Gael, and of course to the people of Charlestown and County Mayo. An honourable and a brave man has been lost. Ar dheis Dé go raibh a anam dílis.
It is important at the outset to acknowledge it is now four years since the Brexit referendum, and it is a good time to remind ourselves that the people of the North of Ireland have not consented to leaving the EU. They are, in fact, being dragged out of the EU by Tory Brexiteers against their democratic vote. It is also a good time for us to recommit to ensuring that Ireland's national interests are upheld, that the Good Friday Agreement is protected, that the Irish protocols are defended, and that we are absolutely resolute in opposing any return to a hard Border on our island.
Ireland has secured a seat on the UN Security Council. This is a mighty achievement and I acknowledge the hard work of all who contributed to it. It is also important to grasp this opportunity to advance the cause of human rights and justice internationally. It is time now for the Irish Government to stand up for the beleaguered people of Palestine. Thousands of Palestinians have died as a result of the illegal Israeli occupation. Gaza is an open-air prison with an economic blockade. Apartheid walls scar the landscape, and international law is openly and brazenly flouted by the Israeli occupiers whose violent settlement of Palestinian lands has displaced countless thousands of Palestinian people, rendering them refugees. The Palestinian people have been badly let down by the international community. There is strong support among the Irish people for the rights of Palestine, but this has not been matched by those in power.
In 2014, the Dáil voted unanimously to recognise the state of Palestine, and with this, the Irish political system was finally moving beyond symbolism to a principled stance. The then Minister for Foreign Affairs and Trade, Deputy Charles Flanagan, pledged at that time to advance matters further. That was six years ago, and since then the Taoiseach and the Government have refused to act on the democratic vote of this House. Instead, they have retreated to the previous position that now is not the time. In fact, the recognition of the state of Palestine advances the prospect of a peace agreement and bolsters the hope of a stable future for the region based on the two-state solution. It is simply wrong to tell the Palestinian people that we support their call for statehood but then turn our backs on them when they reach out to us for recognition. That is the politics of copping out. That is the politics of the blind eye, and it flies on the face of achieving a lasting peace.
This copping out, we now learn, has extended into Government negotiations between Fianna Fáil, Fine Gael and the Green Party. The decision to drop the occupied territories Bill from the proposed programme for Government was both cynical and wrong. Any incoming Irish Government must take action now to demonstrate our solidarity with those living under the cruel and illegal occupation. When Deputy Neasa Hourigan of the Green Party was asked recently what happened to the occupied territories Bill, her answer was very stark. She said that Simon Coveney happened to the occupied territories Bill. That is an indictment of Fine Gael policy when it comes to the rights of the Palestinian people.
Any incoming Irish Government worthy of the name must take a strong stance against the proposed further annexation of Palestinian lands by the Israelis due to commence on 1 July. This proposal is a reprehensible continuation of open aggression against the Palestinians. The Irish Government must tell Prime Minister Netanyahu that this must stop.
Ireland, with our history of conflict and conflict resolution, is uniquely placed to help to build real and lasting peace in the Middle East. We know that dialogue works and that repression does not work. We know that an inclusive process built on equality and respect works. Dominance does not work. This is the perspective that we must take to the UN Security Council and into our meetings with other European leaders. We need to make a start at home by defending our commitments and by acting in defence of human dignity. The people of Palestine, beleaguered, besieged and betrayed by the inaction of the international community, now look to the world and to Ireland for help, and we must not fail them.
While I recognise that the European Council has yet to reach agreement on the specifics of the roll-out of the Covid-19 crisis response, it is no less than an injustice to Ireland that the EU has failed to recognise the potential severity of the challenge that Ireland faces. Taking a moment to recognise the human cost of the Covid-19 crisis right across Europe, and here at home in this State, where more than 1,700 of our citizens have perished, I also want to bring attention to the fact that this is not the only serious challenge which has presented consequences that this island has been forced to address. Ireland has had to contend with a trifecta of major challenges. They are unprecedented, once in a generation trials, from the banking crisis to the impending challenge of Brexit and, of course, Covid-19.
Under the current EU recovery proposals, Ireland is due to receive just €3 billion of the €750 billion fund, or 0.0143%. This is due to the mechanism being deployed by the European Commission to calculate disbursements, and this is simply unacceptable. The mechanism does not accurately reflect the impact of the virus on the economy. This State has seen the fourth highest number of reported cases of Covid-19 per 100,000 people in figures from the EU, EEA and the UK. It is incumbent upon this Government to demand recognition not only of this fact but also of the substantial human suffering that is being wrought upon the people of this country as it is forced to claw its way back from the chasm of economic despair of the previous decade.
Four years on from the folly of Brexit, we are in the midst of the countdown to the final denouement of a drama that has transfixed Europe. How this will impact us as an island is yet to be fully determined. We know that it will require the kind of response that we associate with a nationally co-ordinated plan of action. If only there was no other unprecedented, once in a generation event to which we must also direct the nation's efforts.
As we are faced with the challenge of formulating a recovery strategy from the Covid-19 virus, we must take cognisance of the impact of the devastation wrought by this Government's austerity-driven response to the previous virus visited upon us, which was the virus of greed. Never again should the ordinary people of this island, including workers and families, be forced to shoulder the burden of austerity. Globally and here at home, restrictions brought about by the lockdown have allowed many the time to reorder what we believe to be important to us in life. Perhaps the Government might take a moment to review its instinctive response to crises and maybe take this opportunity to pivot away from the failed politics of austerity. The regressive measures that have punished the ordinary people of this country while rewarding banking fat cats, vulture funds and speculators who have fed off the misery of others must be left in the past.
We must look to the future, offering confidence and compassion. The Government must assume the role of protector of the citizenry of the State. Our response must be one of investment in people, infrastructure and business. As IBEC warns that, without drastic intervention, thousands of businesses face bankruptcy within six months, we must develop a mechanism to protect business leaseholders who are being asked single-handedly to take the hit for rents owed over the period of the lockdown. Elsewhere in Europe, such as in France, the emphasis is on sharing the burden between Government, business and landlords. We must do everything that we can to protect small and medium enterprises and otherwise thriving businesses which are faced with potential closure through no fault of their own. The burden of recovery must be shouldered fairly. As the Taoiseach himself previously stated, we are all in this together.
On behalf of our party, I pass on our sympathies and prayers to the family of Colm Horkan following the terrible, tragic loss of his life in the line of duty last week. It reinforces the sense of pride in An Garda Síochána and the founding principles of that organisation, which involve policing with the trust of the people, which is reinforced when one sees the like of his service and the loss that his family has suffered. As others have said today, ar dheis Dé go raibh a anam dílis.
I join in congratulating the Government, the Department of Foreign Affairs and Trade and our diplomatic service for securing a seat on the Security Council at a time of real uncertainty in the world. It is a vote on behalf of small countries and for the need for small countries to stand together in the world in these uncertain, difficult times. It is also a vote in support of the multilateralism that this country has always espoused, not just in our membership of the European Union but within the United Nations, the work of our peacekeeping forces, our involvement in various climate treaties and so on. That willingness to be global in our thinking even though we are a small island secured us this seat.
As we look forward to taking the seat up next year, it is a time of real risks, uncertainties and dangers in the world. One can see it in the response to the Covid crisis where different approaches have seen different results. In general, the European Union has shown that democratic, open societies can manage to pull people together to produce a response which saves and protects lives, particularly when one looks at the figures for what has happened in Europe compared with what is happening in the United States, Brazil and other counties, where a different emphasis on what is important and how we organise has seen a different result. That need for multilateralism is also seen in what is happening in the ongoing trade wars and the unwelcome withdrawal of the US Government from the OECD process of looking at how we regularise, improve and close loopholes and stop corporate tax evasion, which has bedevilled our world.
I encourage the Government to support the proposed Next Generation EU recovery fund and the expansion of the multi-annual financial framework, the €1.85 trillion package that the European Commission has presented. It is vital that that is agreed at the next European Council meeting, which will happen in person, because time is of the essence and we need to be fast. I support it because I believe the focus on investing in a green and digital transformation is right. It is right for Europe because if one looks at Europe's place in the world, such an emphasis on funding that green and digital transformation will help in various ways. We grew up in a world where the wealthiest 20% of the world, the West, consumed 80% of the material resources. That was never right and it will not be possible or right in the future. If the world is to manage the challenges that it faces, it will have to see more equal distribution of wealth and consumption of resources across the developing world as well as the developed world. Going green and being efficient in using less by using digital technologies to maintain our quality of life without consuming all those materials is the right long-term strategy for Europe.
It will also see a contraction of some of the supply chains that have grown in recent years, particularly in the development of industry in China since that country joined the World Trade Organization, WTO, and a return to reliance on local industry. That will be hugely beneficial in Europe. I believe the root cause of much of the rise of far right, anti-migration and other sentiments in the European Union has been the loss of jobs and industries in traditional communities across Europe. Going green and going digital and bringing supply chains back and having greater diversity of sources of supply makes sense and the Covid-19 crisis has shown us that is a much more secure system.
The third reason this makes sense for Europe and Ireland is that we have real expertise in these areas of green and digital technology. Europe has been ahead in many instances of other continents and other countries. It has been seen to have lost some of that early starter advantage, but I believe we can win it back. It is also the right and appropriate strategy for this country. The green revolution in transport, agriculture and energy will bring to this country all the benefits I have cited as existing for the rest of the European Union. It is critical that the two go together, because the digital technological transformation is one of the key components in achieving the revolution in transport, energy and agriculture and land use. The use of digital technologies in those revolutions and changes is one of the key components in getting it right.
To do that, we need to focus on the ethical rules and investment in the soft elements and not just the hardware. We need to invest in our media and information systems so that our democracy is well informed and can make the right decisions around those ethical rules. As the home and centre of many international social media and other digital companies, we need to set the right ethical rules, and new rules, for those businesses, recognising they have a duty of care not just to maximise profit but to show that this digital revolution is something that will benefit people rather than just companies. We have to set the rules so the ownership of data, particularly as we move and develop new health tracing systems, show best practice in respect of citizens being at the centre of this digital revolution and not corporations. The countries that get that right are the countries that are going to see the most progress, investment, development and benefit.
Also in that regard, in this digital and green revolution we will have to manage whatever Brexit may bring. I will take the example of the green energy revolution. We will move towards a 100% renewable energy system. To get that right, we have to balance the power supply over a wide regional area. I believe we will move to a north-west European regional electricity market, which really will ship power over long distances and match hydropower from the Alps and Scandinavia with solar from the south and wind from Ireland. Balancing that is going to be the key to success. That is happening and that is where money is going to go.
We happen to have the particular difficulty in having the United Kingdom between us and the rest of that regional market. Whatever we do in the Brexit negotiations, therefore, and in managing what is going to be a very difficult process, we must ensure we get agreement on the mechanisms to allow us to continue to connect to the UK, to balance our power supply with the UK and to connect the UK to the rest of the north-west European regional electricity market so we can run our whole economy in this electrical, renewable and sustainable way.
I argue it is the same when it comes to digital services and rules and guidance concerning digital technologies. I do not believe it would be effective for the UK to have a completely different rules-based system for Internet commerce or personal data management. In the end, I believe the UK will have to follow the GDPR rules and standards set within the European Union. How we manage that, how we convince the UK authorities of that and how we organise that is going to be one of the most difficult diplomatic challenges we will face in the next year and onwards.
We must do all of this while also investing here at home. It is in our interest to get answers to those questions set out by the Taoiseach regarding what is agreed. It is right that there will be borrowing at scale, targeted in this new recovery package. We should be liberal in our thinking about considering grants and not just loans, and we should seek to ensure there is real scale beyond ambition because the scale of the transformation we have to make is so great. It is in all our interests, in Ireland and Europe, to be good at this. We should minimise the conditionality, the difficulties and the restrictions; we have to be fast in doing this. I hope that is what we will see happening in the next month with agreement on that recovery fund
I begin, like others, by expressing my sincere condolences to the family, friends and work colleagues of the late Detective Garda Colm Horkan. The whole country was shocked when the news came of his brutal murder. It has united the nation in grief and has underscored for all of us the importance of our police force, An Garda Síochána, the protectors of the peace. Unlike many police forces, members of An Garda Síochána are not law enforcers. The force was founded as a protector of the peace and by and large its members are unarmed people who work so assiduously in our communities to preserve the peace. It is really important that we stand in solidarity with our gardaí when one of their members is so brutally taken from them.
I also congratulate the Tánaiste and the Minister for Foreign Affairs and Trade, Deputy Coveney, and the Minister of State, Deputy McEntee, on the success of the Irish bid over many years. Many Ministers and many Governments have been involved in various parts of the campaign to secure a seat on the Security Council of the United Nations. I know it is not normal to mention individual civil servants, but Ambassador Byrne Nason, who is our ambassador to the United Nations and was the pivotal person in recent times in organising the campaign, has played a pivotal role. It was my privilege to work with her when she worked with the Economic Management Council in a previous administration. Her skills were evident then. It is a great tribute to Ireland, because it was a difficult battle to get a vote in excess of that of a very international country like Canada. We did it because of the values of Ireland expressed over many years.
It is a challenge for us now to be true to those values while Ireland is on the Security Council. Other speakers have referenced, for example, the plight of Palestine and the Palestinian people. We must go beyond lip service regarding that issue and be moral leaders in pushing that agenda. Decades and generations have passed while that issue has been a running sore in international affairs. There will be other challenges next year regarding the playing out of the Covid-19 disaster across the world. We can see what is happening in South America now. I listened very carefully yesterday to the views of the World Health Organisation, WHO, regarding the impact of Covid-19 in Africa, which is yet to suffer the full impact. That could be devastating and we need to have a sense of solidarity. I am already a little concerned that some European countries are banding together to have first dibs on any vaccine that might emerge. Any such vaccine, if achieved, has to be a universal, international human property and must be distributed in an open way to everybody as quickly as possible. These are the challenges I think we will have to face while Ireland has its seat on the Security Council, but we will have many opportunities to discuss our role in the United Nations when that seat is taken up.
Regarding the European Council, there was, unusually, no shared post-Council statement. Instead, a short set of remarks was released by President Michel on behalf of the Council. As the Taoiseach already informed the House, the main focus of the debate has been money. I can assure Deputies that it is not the first time for that at European Council meetings. I refer to money for the multi-annual financial framework, MFF, for the European Union for the next seven years and the new recovery fund.
As I said the last time I spoke in the House, I am glad there is at last international solidarity within the European Union on recovery. That solidarity exists because everybody is affected by the pandemic. When we were arguing for eurobonds for the countries affected by the most recent economic crisis, solidarity was slow in developing and never developed to the extent that it should have.
Charles Michel, President of the European Council, signalled that a consensus was emerging about the recovery fund but that difficulties requiring further discussion and negotiation remained. The Taoiseach has alluded to some of those difficulties. For Ireland and some other countries, the big issue is obviously the distribution of the funds that will become available through the new recovery fund. How will that money be divvied out? I raised this matter with the Minister of State two weeks ago when we debated this matter most recently. It was signalled then that we would get something like €3 billion from this very large fund. That sounded, and is, a paltry sum considering the impact that Covid-19 has had on our economy and people. I asked the Minister of State to confirm the figure of €3 billion and she stated that was the initial indication. I also asked what was the status of the Irish-Belgian request that Brexit be factored into this consideration. I would like to hear specifically what progress has been made on that.
We must also determine whether this money will be given by way of loans or direct grant payments. There was some indication of the breakdown of the initial €750 billion, namely, that it would be given partly in loans and partly in direct grant payments. If we are told we can borrow €3 billion from this fund but must pay it back, that would be, quite frankly, pointless and useless. We can borrow money at historically low interest rates. We do not need a new fund to do that. For example, this week, Ireland, through the NTMA, borrowed €750 million in short-term treasury bills. Those are only short term and are historically lower than long-term bonds but, notwithstanding that, we borrowed that €750 million for six months at a negative yield of 0.49%. We were given money. We were paid to take that €750 million and the issue was 3.8 times oversubscribed.
In terms of longer term money, which the money available in the fund will be, on 9 June, the NTMA borrowed €6 billion in a ten-year bond at a yield of 0.23%. That means we can now borrow money at an interest rate of less than one quarter of 1%. The ability to borrow money from this new fund is no concession at all because borrowing is not the problem. We need the ability to have direct cash. I understood that the idea of the new fund was as an extension of cohesion funding so that countries that have difficulties, as we had when we joined the European Union, are given cash payments and not loans.
The following matter also interests me and we can discuss it further when we have the chance to ask questions. What is the timeline for the distribution of the money? Will it happen, as the Taoiseach indicated, between now and 2024 or will it be during the entire duration of the multi-annual financial framework, MFF, which runs until 2027? Money at the end of that period would be of little value.
I have only one minute left but I want to talk briefly about Brexit. The Financial Timeshas reported rising hopes of a compromise between the EU and the UK. It stated that diplomats had confirmed a shift in mood. There is not going to be an extension to the transition period. The article suggested a middle ground shift on fisheries, which caused me some concern and about which I will ask the Minister of State some questions later. What does it mean? When I raised the issue in our most recent discussion I was told there was no shift from the mandate given to Michel Barnier. It has now been reported that there has been a shift of position. The Taoiseach indicated we would never get a position as good as the one we have now. What is the new negotiating position? Has there been a shift?
On the issue of the level playing field, the UK will, apparently, accept EU standards initially while retaining the right to alter them in the future, at which point new tariffs would be applied by the EU. That is no basis to plan a trade agreement into the future. To do so would be to build an agreement on sand and uncertainty.
I wish I had more time but I will be able to tease out these matters when we have the chance to question the Minister of State later.
I join my colleagues across the House in expressing my heartfelt sympathy with the family and friends of Detective Garda Colm Horkan and his colleagues in An Garda Síochána. We stand with them today.
I also commend everyone who worked hard to secure for Ireland a seat on the UN Security Council. It will provide an opportunity to show leadership on climate action and to be a strong voice for human rights and international law.
There are two points worth noting about the proposed EU recovery fund. As previous speakers noted, Ireland was expected to receive the third lowest share of the funds from the original proposal, despite being projected to have the third largest negative revision of GDP in the autumn and spring forecasts of the European Commission. The Commission formula relies upon GDP as an accurate measurement of economic activity. However, Irish GDP and GNI are heavily skewed by the investment activity of foreign multinationals and investors, rather than the activity of the domestic economy. Therefore, the Commission proposal was also heavily skewed as a result of the attractiveness of Ireland for foreign direct investment.
In addition, as a small, open economy, Ireland is more vulnerable to global trade shocks than other countries and the EU must take this into account. While a revised methodology is likely to see Ireland move closer to an average level of support from the programme, the underlying issue of Irish GDP being a fundamentally flawed indicator of the health of the economy remains and needs to be addressed.
I turn to the proposed taxation and revenue raising measures which are needed to finance the EU recovery fund. New EU-wide taxes are proposed, including a plastic tax, a digital tax on big tech multinationals, a tax on carbon intensive industries and a levy on larger companies that benefit from the Single Market. Following the Council meeting on Friday, French media indicated that a common consolidated tax base or digital services tax could be on the table to help the EU fund the rescue package. As a result of decisions taken in the past decade, Ireland will be one of the countries most directly affected by the introduction of these taxes.
Furthermore, there will be a cost if revenue raising measures are not agreed. Governments would either have to pay more from their own coffers to service the debt or shrink the size of future EU budgets, meaning less money will be available for agricultural subsidies, cohesion or climate action in the future. Will the Government continue to oppose these measures despite the social justice and solidarity implications, to say nothing of the ultimately flawed nature of this model of economic development, or will it use this crisis as an opportunity for reform? We need clarity about the position the Government is taking and what revenue raising measures it will support at EU level. If the Government remains committed to this economic model in the long term, the future implications are for an even harsher economic shock and adjustment period than would be necessary now. The long-term environmental challenges we face as a society must also be included in any strategy designed to get us through this economic crisis. Otherwise, we face another painful adjustment in the years ahead.
On that issue, it is welcome that the Green New Deal is featuring as part of the EU stimulus package and approach being taken. At the same time, however, analysis from Greenpeace shows that a raft of Europe's pandemic stimulus measures, such as tax relief for businesses and reduced excise duties on fossil fuels, are benefiting polluting industries.
Gas and oil companies, car makers and other polluting industries are cashing in thanks to bailouts and other forms of state aid. On the one hand, the European Union is directing large-scale stimulus into the Green New Deal and that is very welcome, but on the other hand, public money is being used to protect and subsidise toxic and polluting industries. The absence of environmental conditions in state aid is counterproductive in the long term. It is somewhat akin to the practice of the Government in funding the building of homes that are reliant on fossil fuel heating systems which will need to be retrofitted at cost to the taxpayer in future years. We must stand by the principle that every euro invested today should be future-proofed with environmental and social conditions. The European Commission must take action to stop investment of public money in toxic industries and ensure a green recovery consistent with the Paris Agreement.
While the EU Green New Deal is very welcome, we must ensure that across the European Union our policies align with sustainability and climate action. For example, the issue of trade with Brazil is important. While world emissions of carbon dioxide will fall by about 7% this year due to the pandemic, Brazil's emissions will rise by between 10% and 20% from 2018 when they were last measured. This is due primarily to deforestation. In the first four months of 2020, an estimated 464 square miles of the Brazilian Amazon was cleared. Tree loss is reaching a tipping point after which trees will dry out and die, releasing billions of tonnes of carbon into the atmosphere. Demand for beef and soya is driving this process and the European Union is the second top destination in the world, after China, for soya exports from Brazil. There are a number of actions that the European Union must take to address this. First, there should be a ban on imports of soya, in particular, and beef from lands that have been deforested. This means banning imports where there is no effective tracing to prevent products from entering the European Union through the back door. Exporters mostly record the land where their cattle are fattened, not where they were reared. Second, the European Union must ensure that consumers are told by supermarkets where their beef and soya come from through robust tracing and labelling. It is no good crying foul when fire rages, destroying the Amazon rainforest. We need effective action on trade, tracing and labelling to be taken now.
I want to address the need for human rights in the European Union to be addressed at European Council level. I have spoken here before of the situation in Poland where a third of Polish municipalities, some 90 towns and cities, have established so-called LGBT-free zones. I have written to the Tánaiste and Minister for Foreign Affairs and Trade, Deputy Coveney, about this. It is a flagrant attack on human rights and is not acceptable in the European Union. Likewise in Hungary, Viktor Orban has clamped down on civil society and sought to undermine civil society organisations that criticise government policy. In May, Hungary passed a law banning trans people from legally registering a change in their gender, putting them at risk of harassment, discrimination and violence. This is in no way acceptable. There must be a strong united and co-ordinated approach across the European Union that stands firmly for human rights and against the targeting of minorities. It is essential that the Government raise its voice in defence of human rights and not continue to leave it to other EU states to call out unacceptable targeting of minorities by the Governments of Poland and Hungary. Other EU states are doing that.
On the very important issue of Palestine, we need leadership at this time. It is disappointing that the occupied territories Bill has been dropped from the programme for Government. It sends the wrong signal. The Bill is consistent with the exception allowed for in EU law, which enables states to unilaterally ban imports of certain goods on the grounds of public policy. For the avoidance of any doubt, the Bill could be passed and then tested by the European Court of Justice. We need more than strong words from the European Union at this point to prevent the annexation of land in the West Bank. We need action. There is no indication from the Government or from the European Union that any effective action will be taken. A policy of appeasement in respect of Israel clearly has not worked. We cannot accept the grave injustice of any annexation of land against the Palestinian people, nor can we have any tolerance for land grabs. It is worth noting that the EU has clout, as it is Israel's top trading partner. Israel has a privileged trade relationship with the European Union. Its goods are subject to preferential tariffs under the EU-Israel Association Agreement. Furthermore, Israel participates in the EU Horizon 2020 research funding scheme. A united, cohesive European Union is reliant upon upholding the principles of international law and human rights. We need effective action at European Union level and we need Ireland to show leadership on this. Words are not enough.
I am sharing time with Deputy Barry. I raised the issue of Palestine with the Minister last week. Israel has vowed to annex the Jordan Valley, which makes up 30% of the occupied West Bank, this time next week. The EU has specifically stated that if Israel makes this move, it will be contrary to international law and decency. If this action takes place, what will the European Union do to penalise the state of Israel? As Deputy Cian O'Callaghan has said, this is against the background of the occupied territories Bill being omitted from the programme for Government. It is no coincidence that the Israeli ambassador as well as US Congressmen and Congresswomen had been lobbying the three parties on the programme for Government. We can see what is at play. With all this in the background, in respect of the EU and Israel and the economic trade between them, what penalties is the EU going to impose on the state of Israel for its aggression and its proposed annexation of the West Bank?
The pandemic has hit the aviation industry hard. How can European governments respond to this crisis in aviation? In Germany, Lufthansa received a state bailout of €9 billion and in return the state took a 20% stake, making it the largest shareholder. Presumably this gives the German state significant leverage now in determining airline policy. The option that I would favour is the nationalisation or renationalisation of airlines. This would allow the State to act directly to defend jobs, wages, conditions and services. The next crisis, the climate crisis, could then be met on the basis of a just transition policy free from the agendas of profiteers. However, the caretaker Government seems to be operating on the basis of a third option. This involves the State providing subsidies while allowing the owners of the airline a free hand in driving down the wages and conditions of their workforce. CityJet has sought the protection of the Irish courts and this has been granted by way of examinership. Examinership is meant to protect a company from its creditors while jobs are being protected, possibly through restructuring. That is not what is happening here. The airline's Cayman Island shareholders are being protected from the creditors while the airline shuts down its Dublin base, cuts its workforce in half and offshores Irish jobs by way of hiring new staff through Copenhagen on contracts that offer lesser wages and conditions. The CityJet situation highlights the particularly vulnerable position of precarious workers in an industry where a majority of people who work on Irish-registered aircraft for Irish-registered airlines are no longer directly employed. This vulnerability has been facilitated by Fianna Fáil and Fine Gael Governments in recent times.
I do not have time to deal with the Ryanair situation so I will deal instead with the question of Aer Lingus. Aer Lingus workers were hailed as national heroes when they loaded, crewed and flew planes to China and back to bring us the personal protective equipment, PPE, that our health service so desperately needed. However, the heroes are now being treated as zeros by the ruthless vulture capitalists who run Aer Lingus and are now exploiting this Covid crisis to drive through measures they have wanted to introduce for years.
Instead of sitting down with the unions to discuss options which the workers themselves put forward such as career breaks, part-time work and other rescue measures, the company is trying to take unilateral action by imposing the following shock-doctrine, race-to-the-bottom terms on its workforce. It proposes 500 redundancies, reduction of pay to 30% of pre-Covid levels, hiring of casual, so-called contingency labour, banning strikes or any form of industrial action until February 2022 and telling pilots that they have a certain number of weeks to consider their options but that all the other staff members must make decisions now.
Let us break down some of those figures. When one takes the temporary wage subsidy into account, 30% of pre-Covid levels means Aer Lingus can employ a considerable number of low-wage workers and pay them nothing or, in some cases, marginally above that. The company's original proposal of 50% of pre-Covid wages means that a worker who was previously on €800 a week will take home €400 with €350 paid by taxpayers and a mere €50 by Aer Lingus, with the company paying a pension contribution of zero. Aer Lingus workers tell me that a continuation of that policy into next year, combined with the ending of the mortgage payment freeze, would result in families being unable to make mortgage payments and in the spectre of airline workers losing their homes. Meanwhile this caretaker Government, which has subsidised 4,300 Aer Lingus pay packets to the tune of €18 million to date, stands idly by and takes no action to make its subsidy in any way conditional on an end to management by diktat and the opening of something that would resemble genuine negotiations. Members should recall this is a company, privatised between 2006 and 2015, that has recorded profits for the best part of a decade including €276 million last year, €305 million the previous year and which has cash reserves of €900 million. Moreover, it has a parent company, IAG, which made profits of more than €3 billion in 2018, yet it says it cannot afford to have genuine negotiations with its workforce.
I congratulate the Aer Lingus cabin crew, members of Fórsa, who voted by a three to one majority - even with a gun to their heads - to reject the company's terms. The workers represented by SIPTU must now have their say. I stand for the renationalisation of Aer Lingus, with compensation only to be paid based on human need, not giving vast payouts to vulture capitalists who pursue policies such as this. I put Members of this House on notice that in Cork, on Shannonside and in the north County Dublin constituencies, there will be a surge of workers anger in the weeks ahead if a new Government does not at the very least intervene to stop the Aer Lingus vulture capitalists from exploiting State subsidies while the company tries to walk all over the rights of its workforce. That will not be tolerated.
I am supposed to be sharing time but the other Deputies may have been caught by the times moving. Things are happening in Europe. Things seem to be slowing down with Covid-19 but things are moving on behind the scenes. One thing which was meant to come up was the conference on the future of Europe. I note Ireland and 11 other countries sought to attend, one would expect it would be an automatic attendee at a future of Europe conference, but it seems that only Germany and France are attending. That says a lot about the European Union and its whole concept. We know that Germany and France are calling the shots but it is interesting for it to be so blatantly laid out. It is very worrying that it would go ahead and that Ireland and others would have to write to ask to attend. Angela Merkel has confirmed the European response to the crisis might require treaty changes. Perhaps she will update us on what they will be in the coming years.
The deal with Mercosur has yet to come up for adoption at the national parliaments. Hopefully it can be held up here but a new Administration comprising Fine Gael, Fianna Fáil and the Green Party will probably railroad it through anyway. There are serious implications in respect of what is happening with that process. We should be very careful and should strongly mark Ireland's concerns regarding environmental protections and on how Brazil and Argentina do their farming. I note that 149 pesticides used in Brazil are banned in Europe. What measures do we have to ensure they will not come through and be imported into Europe? They will probably go straight ahead with it.
Europe also is expanding its military might and power throughout Africa. The German armed forces are increasing their presence in Mali and there is increased expansion into Niger, Burkina Faso, Mauritania and Chad. German and European forces will be moving into those processes as well. I am interested in how the Minister of State envisages Ireland's role in that regard. Ireland already operates in Mali and we will move to further integrate within the European military structure. What will be the Government's view in respect of its development in the future? We should be very concerned about that.
Brexit and its implications, which will be big, have not been mentioned but there are many more pressing issues. Brexit, the Mercosur deal, the ongoing militarisation and the future of Europe are all crucial.
I have been listening to the debate. I had hoped the Taoiseach would be here. The last time I addressed him in the Chamber, I spoke of grant aid which the German Government is providing for small businesses. I mentioned a figure of €50 billion. He told me he had not heard that and asked that I send him the information and I have done so. I will quote the German finance minister when he announced this measure. He stated:
I want to make a crucial point: We are providing grants, not loans. Nothing has to be paid back [to us]. In this way, we’re taking action to reach the people who urgently need our support right now.
I had asked the Taoiseach whether the Government would look again at grant aid for small businesses, many of which are now in the process of making decisions on whether to reopen, as well as those that face a mounting wall of debt from utility bills, insurance and so on over the past few months. People are mow making decisions as to whether they will reopen. While some grant aid is available to businesses based on rates paid, for those who do not pay rates for many very legitimate reasons, there is no assistance.
That is very small fund compared, for example, with what some of our European counterparts are paying. This was my question for the Taoiseach. I hope he can respond in writing.
I have two further questions for the Minister of State. The European Council, after its meeting, referred to maximum flexibility in the application of the budget and state aid rules. What flexibility has the Government shown on state aid rules as far as some other companies are concerned? I asked the Tánaiste and Minister for Foreign Affairs and Trade, Deputy Coveney, whether an analysis had been done on the flexibility we have shown on state aid, how that compares with other EU countries and whether any companies or businesses here are suffering as a result. Some of my colleagues spoke about IAG, Aer Lingus, etc. While I know there are issues in this regard, is there any possibility that the Government would consider providing state aid to Aer Lingus, similar to that which the German Government has provided to Lufthansa?
The proposed new recovery instrument, Next Generation EU, is worth €750 billion. When added to the multi-annual financial framework, we are looking at approximately €1.85 trillion. It is very clear, as the Commission has noted, that this will require increased own resources. What is the view of the Government on the issue of increasing own resources? The European Parliament has called for this for some years but there were always blockages within the European Council. I know this is an emergency but can I have a general indication as to what our Government’s view is on this issue?
Given the progress that we have made as regards time, with the agreement of the House, I propose that we allow Members from the Rural Independent Group to speak for ten minutes. I call Deputy O’Donoghue and then Deputy McGrath to speak.
I thank the Cathaoirleach.
I understand that €540 billion was assigned to a recovery programme for workers and businesses in Europe to strengthen, in particular to strengthen the resilience of the health system and promote innovation in it. How is this being monitored in Ireland? Are we proactively working with our stakeholders, including our wonderfully innovative pharmaceutical companies, to engage with this programme? If we are being rewarded for innovation, is the Government consulting the many Limerick-based pharmaceutical companies, such as Regeneron and Stryker? While the total fund for Europe is €540 billion, the figure mentioned for Ireland is €2 billion, although I believe that may have increased to €2.7 billion. Are we pushing to get more of this funding? Are we getting our fair share of the pot?
In economics, Europe’s policy for business is to ensure maximum impact, minimise administrative burden and avoid duplication. This is not what I am hearing on the ground. There are six or seven page application forms for grants with questions on cash flow and projections. These are difficult for small and medium enterprises as they are frustrated trying to open for business and do not see funds coming through. There are several examples of SMEs starting up in Europe which have had cheques posted to them. In one case, a restaurant received €50,000 in the post. Why are we so different? Big ideas in Europe are cumbersome for SMEs in Ireland because they do not see them materialising. They are tired of the process. All they see with regard to grants is a mirage and they are unsure if they qualify for them. This is the reality on the ground. I hate to waste time talking about accountability and simplifying application systems, whether it is applying for an SME fund or for a street light in the community. Procedures have to be simplified because they act as barriers to doing business. I challenge the Government and the next one to ensure we apply enough pressure on Europe for funding. Could we potentially get more from Europe? God knows, we deserve it because Ireland has been a loyal partner on Brexit and the banking crisis. My understanding is that some €100 million has been drawn down from a fund of €650 million. We have to ask why this is the case. Do we have the wrong schemes? Is the process so cumbersome that our SMEs are starved of cash?
I have sought help from the Government for a company in Limerick which has been manufacturing PPE for this country. I have given the Government paperwork on this based on a €2 million investment in Ireland which would be cost neutral after three years. This project would create 40 jobs in east Limerick, where jobs like this have not been seen in years. I see from the Internet that the Government has given €102 million to a company with 12 employees in County Clare for the supply of PPE. There are 90 people working in this company in Limerick and it is projected it would employ 40 more if it had an investment of €2 million over three years. This would be cost neutral and we would have PPE manufactured in Ireland and jobs created. However, we see €102 million going to company with 12 employees. How many people in the Government are self-employed? How many of them understand business and job creation? What sectors do they come from? We have seen how farming and businesses have been let down. It is evident that the Government does not have know-how. Why does it not ask Independent Deputies? How many independents are self-employed or from business backgrounds? They have massive experience. The Government has centralised everything in Dublin, which it does not wish to leave. For years, it has let us down. It is about time it asked for this help. We will help and I will help anyone but the Government should listen to us.
I thank the Acting Chairman for allowing us to speak. I also thank my colleagues in the House. We were watching the monitor and did not realise that the Regional Independent Group did not have a speaker. I was present for the Taoiseach’s speech. On that note, I convey my thanks again to the Chair.
The Taoiseach mentioned a meeting and an engagement with six countries in eastern Europe, which are interested in joining the EU. He also spoke about the ambitious recovery plan and a meeting with the President of the European Central Bank, who painted a very stark picture of recovery up to late 2022. If the so-called green, blue, and lighter green deal gets through next week, the Taoiseach may hope to be back holding the reins again when the money starts to flow again. There may be some subtle thinking going on there as he may know something more than some of us here know.
On the issue of demonstrating solidarity in Europe, the EU did not demonstrate solidarity in the past. When the banks collapsed here, we were robbed blind by our EU colleagues. We got money from the International Monetary Fund at an interest rate of less than 3% whereas our so-called friends and partners, to whom we had been so loyal, charged us almost 6% - 5.9% to be exact. Where was the solidarity there? We need to be kicking and hammering the table. I appreciate the Minister of State’s job but we need to get bang for our buck and as much of the funds and corona bonds as possible because we need it for our businesses, as Deputy McNamara just pointed out. Why would they give it to us when they see the way our Government treats small businesses?
Take the rates moratorium. I have had endless numbers of people in Tipperary on to me in the past week getting their second moiety bill for a full rate for 2020. They have been shut down by the Government - we all, in fairness, myself included, agreed to that - and denied the power to work and to continue to earn revenue in order that they could pay their rates. I am told, however, by the local authority in Tipperary that the Government has not given them a penny. That is why. The local authorities are legally obliged to send out the second moiety. They have no indication as to the holiday for the three months they got at first or the parking of it. Is it to be extended for another month or two, which it should be? They got no funding. That is way the Government is blackguarding local authorities and, by extension, blackguarding the ratepayers. These are the people who keep our towns and pay the rates - generate the money, employ people, pay their taxes and pay rates for which they get so few services any more. One time, when I was a duine beag, they got many services, there were corporation staff and they got refuse collection, water and everything. They got maintenance of the streets and footpaths. Now one would not get an eggcup of salt in a frost or anything else, and one is expected to pay the rates. One restaurant owner's rates are twice as much as they were last year. That is shocking. They have been blindfolded and their hands tied behind their back and not allowed to work, and now they are not getting a break. Of course, there are big announcements, public relations, PR, and spin. I saw the Taoiseach last night called Sinn Féin "the spin party", but he is the man with the spin and the big spin machine. That was all announced in a blaze of glory. We all welcomed it. Now, show me the money. They cannot see the money. The local authorities are sending out the bills for a full year's rates. This is the second moiety. It will be due in July. I salute the ratepayers up and down Tipperary and the rest of the country who have been paying their rates.
When we had rate collectors, they had a good relationship and they always paid them. The farmers paid their rates too when they were there before we had the great giveaway in 1977, when we started the auction politics and when I, like an eejit, was putting up posters on the poles, much to my regret, saying we welcome this and no car tax. We have paid the price ever since. The auction politics is still going on. We have a leader now who would give anything to get into the Taoiseach's seat over there. I mean a Fianna Fáil leader, not my leader, I would say, thanks be to God, and meaning no disrespect to Deputy Haughey. If the Deputy's late dad came back, he would put manners on many of them and they would be a party to support and admire.
Why would Europe give us the money when they see the way we treat funds that have come from Europe? What do we do here with our legions of bureaucrats? We add more statutory instruments on statutory instruments and more amendments. We make it three times or four times as hard. The French people would not take it. The Germans would not take it but we are the patsies in Europe. We take everything. We are the good boys in Europe. Now it is time for Europe to show solidarity with us here. The Taoiseach mentioned it there, but he should show me the money. It is fine to mention it but we need to see it in hard cash. We need schemes that support farming industry in Tipperary and small businesses all over the country. They are on their knees and they are pleading. Above all, they have been denied the right to continue trading and now they are not allowed any supports where these were promised.
The EU faces a number of challenges at this time, including the Brexit negotiations, climate change, economic recovery following Covid-19, the conflict in Syria, the faltering EU-Turkey migration agreement, and threats to the rule of law in Poland and Hungary. We are fortunate that Germany takes over the Presidency of the European Union next month. Chancellor Merkel's wisdom and experience will be called upon in spades for the next six months.
I have only two questions. My first question is in relation to the Next Generation EU initiative. This, we are told, will be a mix of grants and loans. To repay this, the European Commission has brought forward new own resources proposals, including, for example, an extension of the emissions trading system based on own resources to the maritime and aviation sectors, a carbon border adjustment mechanism, a Single Market levy and a digital tax. What is the Irish position in relation to these own resources?
A digital tax would, of course, cause problems for companies here in Ireland such as Google and Facebook. Is our economic model, which relies on a low rate of corporation tax, under threat? The OECD is due to complete its examination of this issue by the end of the year. The European Commission seems intent on introducing a new EU levy on digital services, as well as a minimum corporation tax, if the OECD process fails. While Ireland of course has a veto, the pressure on us to yield on this point is increasing all the time. Does all of this pose another challenge to our economic recovery and to our foreign direct investment? We are heading for a perfect storm and I would be interested in the Minister's views on that.
On this issue, as the Taoiseach outlined earlier, the Next Generation EU financing will be raised by temporarily increasing the ceiling on own resources to 2% of the EU gross national income. This will allow us to borrow the money. In terms of how we repay that, this is a debate that is still ongoing and on which there has been no agreement. Ireland's perspective has not changed. We have said - this is an agreement that has been reached by all member states - a tax on plastics is something that we would agree on. We have said that we would consider looking the proposals regarding the emissions trading system, ETS. However, in terms of the common consolidated corporate tax base, CCCTB, or digital tax, as the Deputy outlined, we would be highly sceptical. Particularly when it comes to the digital tax, we believe that this is an issue that should be addressed through the OECD process. It is a global issue and it should be dealt with on the global stage. Our position on that has not changed. There are obviously different views. This is the first time that these proposals have been dealt with since the introduction of the Next Generation EU fund. Obviously, we want leaders to be able to reach an agreement by July.
This is our position. We support the introduction of plastic-based taxes and possibly a look at ETS, but all of the other issues we see as being potentially problematic.
Deputy McDonald outlined in her contribution why it is critical that we would recognise the state of Palestine, a motion on which was passed by the Dáil six years ago. At this critical juncture in time, it is important that all the leaders of all the political parties here in Leinster House would commit to this happening at this point. When I say it is critical at this point, obviously, major things are happening in the Middle East, particularly the annexation by the Israelis of the West Bank. It is critical, if we are to salvage any prospect of peace and a two-state solution. I will ask a direct question of the Minister of State. Will the Minister of State now commit to recognising the state of Palestine? It is critical that that question is also asked of the leader of Fianna Fáil, and of the Green Party. This is something that Sinn Féin commits, if we enter government to doing immediately.
My second question relates to the Control of Economic Activity (Occupied Territories) Bill 2018. The events coming up on 1 July in respect of the Israeli Government's plans, with the support of Donald Trump, to annex the remaining settlements in the West Bank, show clearly the importance of that Bill. The Bill is a chance to shine a continuous light on the horrendous treatment of the Palestinian people. We know the views of the Tánaiste and Minister for Foreign Affairs, Deputy Coveney, and of Fine Gael on this and why it was excluded from the programme for Government but I also would like to ask the question of the leaders of Fianna Fáil and the Green Party. I ask specifically whether the Minister of State will reconsider ensuring that the Control of Economic Activity (Occupied Territories) Bill 2018 is renegotiated into a programme for Government, given what will potentially happen on 1 July with the annexing of the settlements in the West Bank.
Our position on this, as the Deputy mentioned, has been stated clearly by the Tánaiste. The long-standing support for a two-state solution has been part of our foreign policy for some time now and will continue to be part of our overall foreign policy. We would prefer to recognise-----
We would prefer to recognise the state of Palestine as part of a two-state solution. This is something the Tánaiste, in particular, has worked hard on over the past number of years.
The issue of the Control of Economic Activity (Occupied Territories) Bill 2018 has been raised a number of times but the position of the Attorney General has not changed. It goes beyond what any Government has an ability to do, in particular, if we look at this as a trading matter and an EU competence matter.
The Bill would not be implementable and is not part of the proposed programme for Government being voted on at the moment. We will commit to our overall engagement as part of an attempt to find a two-state solution to the problem. We will, of course, continue to prioritise the Middle East peace process after taking our seat on the UN Security Council, which is an opportunity for us to try to progress what is, as the Deputy rightly noted, an ongoing issue that needs to be addressed as soon as possible.
I will pose questions in the two categories I raised earlier. On the new recovery fund, where stands the Belgian-Irish initiative? What sum is on the table for Ireland and is it in the form of loans or grants? As I have indicated, we can borrow our own money at very cheap rates.
On Brexit, where stands the fisheries portfolio? What does the phrase "middle ground indicated" mean? Has there been any modification of our position on fisheries?
Where are we in respect of the level playing field issues? Is there a proposal on the ground and, if so, will the Minister of State brief us on it?
Finally, I turn to state aid. What is the negotiating position? Has it been modified? According to the Financial Times, it has been modified between the EU and the UK.
We are still at that stage. This was the first time that EU leaders had an opportunity to meet since the presentation of the recovery fund and the new MFF proposals. The Taoiseach reiterated our position that there would need to be flexibility within the budget and raised the fact that, although we are talking about front-loading many of the funds and immediate funding is required, if any implications arise from Brexit, and to implement the farm-to-fork strategy or other climate action plans, the funding will be needed later in the terms-----
The figures suggest there is approximately €1.9 billion and €1 billion in loans and grants, but this is not something we consider acceptable. When the two funds are taken together, we are talking about paying more money than we had previously, while we are seeking less funding in the Common Agricultural Policy, which is a key priority for us, and receiving an overall fund that we consider inadequate. We have stressed the position, and the Taoiseach made it clear last Friday, that we support the Commission's overall proposal. We think it is good, in terms of the overall balance of loans and grants and the size of it, but we believe that what we are getting out of it is not acceptable.
On the Brexit negotiations, there has been a slight shift and there is a more positive tone in respect of possible progress to be made over the next few weeks. Intensification of discussions will happen in July and August with some face-to-face meetings. From our point of view as to the implementation of the protocol, there has been one specialised committee and two joint committees, while a further specialised committee is due to meet in July-----
For fisheries, "No" is the short answer. Michel Barnier was clear when he addressed the General Affairs Council on Tuesday that without a deal on fisheries, there would not be an overall trade agreement, and vice versa. The mandate is clear, therefore, and it has not changed.
We are still examining the proposals for the MFF and for the recovery fund, and nothing has yet been agreed. It is welcome that there are certain priorities for us where we have seen an increase in funding. In the MFF, there has been an increase in Pillar 1 and Pillar 2, while for the CAP in the recovery fund there has been an increase in Pillar 2 of €15 billion. While that amounts to €26 billion in total, we believe there needs to be more specifically in that area. There has been an increase in funding for Horizon, Cohesion, Erasmus+ and various sectors, but again we would like Ireland to get more out of it. The total figure is not yet fully agreed to or understood, and there is still work to be done to ensure that Ireland will get the most out of this and that we show support and solidarity to other member states.
The decision of Fianna Fáil, Fine Gael and the Green Party to drop the Control of Economic Activity (Occupied Territories) Bill 2018 and leave it out of the proposed programme for Government is a disgrace, and a betrayal of the Palestinian people and of any semblance of commitment to human rights for people generally, specifically for the long-persecuted Palestinian people. Was dropping the Bill the price of getting the seat on the UN Security Council? Given the reports of lobbying by the Israeli ambassador and US congresspeople, will the Government furnish to the House and the public any and all records, memos or communication between the Government and the Israeli ambassador, or between civil servants and the Israeli ambassador, and similar communications between the Government and representatives of the US Congress? We need transparency about who lobbied the Government, what it said and what conversations led it to sacrifice the Palestinian people in this appalling way.
Our position on settlements is absolutely clear and we are opposed to them. As I outlined earlier, the Government's position on what it would like to see happen is a two-state solution for Palestine and Israel. The Control of Economic Activity (Occupied Territories) Bill 2018, however, is different, given that it would move into an EU competence. The Attorney General's advice on this is clear and will not change.
I am not aware of any lobbying that has been ongoing. The Tánaiste stated we had received votes from many of the Middle Eastern countries as well as from throughout the globe, given the overall figure we received. It is very good that we have gained a seat on the UN Security Council because it will put us at the very heart of the decision-making process for the big international peace issues, including that which the Deputy raised. It will give us the opportunity to be around the table with the key member states in this regard and to progress the issue even further.
I already asked three questions about the €50 billion fund, and while I am happy to wait for the Taoiseach to respond to me in writing, the Minister of State might respond now if she can. I am also happy to receive a response in writing to the question about own resources.
I have two questions, however, that I would like the Minister of State to address now. On the issue of state aid, I stated that the Commission and the Council have spoken about maximum flexibility in regard to the budget and state aid rules. I asked what flexibility we had shown in this country and I specifically mentioned Aer Lingus, but I wish to ask a more general question about that and about how we compare with other European countries. I hope I am not taking him up wrong, but I think Deputy Howlin asked whether there was even a hint that there might be a shifting of the ground in respect of state aid in the Brexit negotiations. I do not think the Minister of State answered that question - if she did, I did not pick it up - but she might outline whether that is the case. It would not just be significant for the country but would have massive implications for the Border areas in particular.
Several Deputies asked about the package and Ireland's share. The share is as it is because the rationale used takes into account our growth levels in previous years. While we want the amount changed, are we making any progress in changing the basis for the decisions being made about what each member state will get? We should not just ask for more money but seek to change the basis and arguments being put forward for deciding on the final sum.
As I raised at the General Affairs Council, we have argued that the Commission was given a clear mandate and that it needed to base any instrument on the impact that Covid is having on a particular member state or industry. We believe that the Commission is looking at a pre-Covid economic picture, which is obviously very different. We have argued that point and are not the only country that has done so, and we now have to wait and see.
There will be a series of discussions with Mr. Charles Michel, either face to face or by video conference, before physical meetings of leaders on 17 and 18 July. We will continue to stress that the Commission was given a very clear mandate and that it needs to adhere to it. Obviously, the difference this would make for us would be significant.
With regard to state aid, I am not sure how we compare to other member states. We have a €200 million Covid products scheme. Essentially, it is a targeted State support to develop supports regarding research, innovation, the development of Covid products and the upgrading of testing facilities. There are also various other elements. I can get the Deputy more detail on that and send it directly to her. A package worth €250 million was agreed on 4 June by the Commission to support micro-companies and small companies. I understand there is €450 million so far. How that compares with the funding in other member states, I am not sure. I can certainly get the breakdown for the Deputy.
With regard to the proposed digital tax, the Irish position for a number of years has been that it should be decided through the OECD. Given that the US has withdrawn from negotiations on the tax, it makes an OECD decision less likely. There is a growing head of steam around Europe for a digital tax. Is the position that we will agree to it under no circumstances, or are there some limited circumstances in which we would agree?
With regard to EU-wide efforts to develop a Covid-19 vaccine and the fact that the early-stage development of a vaccine by a number of pharmaceutical companies involves the experimental use of genetically modified organisms, was there any discussion at the European Council on a temporary lifting of the ban on the use of genetically modified organisms to facilitate this? What is the position of the Irish Government on a temporary lifting of the ban?
I actually give praise where praise is due. Well done on getting a seat on the UN Security Council.
We are targeting as much funding as we can get, but how do we get it delivered more efficiently? It is taking too long to deliver funding to the likes of SMEs. The process is too complicated. What can the Government do to simplify it? Many people with experience around this House know how to proceed in this regard from a business perspective. If the members of the Government would like to come to us, we would have no problem helping.
In state aid. I will get the details and have them sent to the Deputy.
On Deputy Cian O'Callaghan’s questions, contrary to reports, the USA has not pulled out of the OECD process. It has raised concerns about the timeframe and the implementation. It has sought an extension of the overall discussion. At European level, France, Italy and Spain have been asked to pause their progress in this area, or the implementation of their own legislation. From our point of view, this is a global issue that should be dealt with on the global stage. That is why we support the implementation of any new measures through the process we are engaged in. Whatever comes out of it, we will, of course, accept it fully.
On the question on vaccinations, I am not sure. I do not believe it was raised at the European Council meeting but I will try to revert to the Deputy in more detail on the matter.
With regard to the overall funding, I will simply the matter. Many of the measures we have put in place so far have been through our own funds. The Minister for Business, Enterprise and Innovation, Deputy Humphreys, has tried to make the funds as accessible as possible. There is, of course, a mixture of loans and grants. We will, of course, try to access as much of the European funding as possible. The initial pot, €540 billion, was agreed only a number of weeks ago so the process will take time. The funding we are talking about here today, the €1.1 trillion, in addition to the €750 million, is yet to be agreed. What is important for citizens is that we agree to it as quickly as possible and that the money gets to the people who need it. Certainly, from an implementation perspective at Government level, we are trying to make it as easy as possible. The Revenue Commissioners have played a major part in trying to ensure paperwork and everything else can be dealt with after people get their funding.
I will take the time, if I may, because there are a number of issues that may not have been touched on.
I join colleagues in offering my deepest condolences to the family, friends and colleagues of Detective Garda Colm Horkan. It is a sad day if a member of An Garda Síochána goes to work and unfortunately does not return home. I thank the gardaí for the work they do daily.
I thank the Deputies for their statements and questions on the June European Council. I will revert to some of the Deputies with further detail.
As the Taoiseach indicated, I will focus my wrap-up remarks on the situation in eastern Ukraine and the eastern partnership summit that took place by video conference last Thursday. Since March 2014, the EU has progressively imposed restrictive measures on Russia. The measures were adopted in response to Russia's actions undermining the sovereignty of Ukraine. From the outset, Ireland has been unwavering in its support for Ukraine's sovereignty, independence and territorial integrity. There is increasing concern over the humanitarian situation in eastern Ukraine, in particular given the Covid-19 crisis. We continue to receive reports that the OSCE Special Monitoring Mission to Ukraine and relief organisations continue to be denied passage to the non-government-controlled areas of eastern Ukraine.
Leaders stressed the importance of solidarity in the Covid-19 crisis, including through the EU's substantial supports to address the impact of the outbreak. Through what is known as the Normandy Format, France and Germany have been in dialogue with Russia and Ukraine to implement the 2014 Minsk peace deal and find a peaceful solution to the situation in Ukraine. Chancellor Angela Merkel briefed EU leaders on the state of play regarding the Minsk agreement since the most recent Heads of State Normandy Format summit, which took place in December 2019. While three prisoner exchanges have taken place, the lack of substantial progress on the implementation of the Minsk peace deal and Russia's ongoing military support for separatists provide a clear and continuing basis for extending the targeted economic sanctions. The eastern partnership summit that took place on 18 June delivered a uniform message of solidarity from EU leaders to the six partner countries. Appreciation of the strategic importance of the partnership was expressed by all members and participants. The summit provided the opportunity for high level exchange on the long-term policy objectives of the eastern partnership and helped set the state of play for the physical summit to be held in March 2021. Leaders stressed the importance of solidarity during the Covid-19 crisis, including through the EU's substantial support to address the impact of the outbreak in the eastern partnership region. The Taoiseach welcomed the eastern partnership's renewed focus on strengthening resilience in the region, not only in the context of the current pandemic but also across all areas, including democracy, economy, security, media, gender equality and health. To strengthen resilience, the Taoiseach suggested championing the youth sector and civil society. In this regard, it is Ireland's intention, as soon as it will allow, to work with the European Commission and partner countries on a project on youth and culture.
At the summit, leaders agreed to continue to work together to overcome disinformation. This is particularly important during the ongoing Covid crisis, when disinformation can cost lives. A number of participants emphasised the importance of starting preparations now for next year's physical summit and to identify deliverables on all the proposed areas of co-operation: economy and connectivity, accountable institutions, the rule of law, security, the green and digital transformations, and fair and inclusive societies. The Taoiseach availed himself of an opportunity to mark that Ireland will open its first resident mission in a partner country when it opens its embassy in Kiev later this year, if of course Covid-19 circumstances allow it.
I thank all Deputies for their statements. The Taoiseach will continue to report to the House in advance of and following regular Council meetings.
I thank the Croatian Presidency for its work over the past six months. It has been a particularly difficult time for it given the current circumstances. In particular, I congratulate it on the progress made on opening the accession negotiations for North Macedonia and Albania. Enlargement is an extremely important issue and one that Ireland supports. I wish the German Presidency well. It has a challenging and difficult few months ahead.