Dick Roche (Wicklow, Fianna Fail)

I am happy to be here today to participate in the discussion of the spring European Council which took place in Brussels on 25 and 26 March last.

The conclusions of the European Council and the declaration on combating terrorism have been laid before the Houses of the Oireachtas. Members will be aware that the Taoiseach made a statement on the European Council to the Dáil on 30 March. The meeting was very successful for the European Union.

The European Council adopted a declaration on combating terrorism; reached agreement to resume negotiations in the Intergovernmental Conference on the constitutional treaty; identified what needs to be done to promote sustainable growth and more jobs in the context of the Lisbon agenda; and had an exchange of views on a range of international issues.

The first session of the European Council was devoted to combating terrorism. It was held as a direct response to the horrific terrorist bombings in Madrid on 11 March. The scale of that attack demanded a real and rapid response. That is the reason the Irish Presidency drafted, and the European Council adopted, a comprehensive declaration on combating terrorism. The declaration underlines that we are at one in the European Union in our determination to face down the terrorist threat.

Since 11 September 2001, an enormous body of work has been ongoing in our fight against terrorism. The attacks in Madrid injected a new urgency in bringing this work forward. The declaration adopted by the European Council was considered at a specially convened meeting of Justice and Home Affairs Ministers and was also considered by Foreign Ministers in a meeting which preceded the European Council. It highlights existing co-operation, seeks to improve it and emphasises the need to implement what we have agreed. It also sets out a number of important initiatives in the fight against terrorism.

The declaration includes measures to improve intelligence-sharing, to strengthen border controls and the security of travel documents, to enhance protection for our transport systems and to counter the financing of terrorism. The European Council renewed our commitment to implement the European arrest warrant in every member state and strengthened our efforts to prevent the financing of terrorism.

Combating terrorism demands a more effective and systematic approach to the exchange of information between our police, security and intelligence services. High Representative, Javier Solana, has been asked to report to the June European Council on how intelligence capacity within the Council structure can be integrated. The European Council agreed new strategic objectives for a revised plan of action on terrorism and will agree, in June, the key tasks and deadlines by which these tasks are to be achieved. Improved co-ordination across the whole of the European Union is essential to defeating terrorism. That is why a counter-terrorism co-ordinator has been appointed. Dr. Gijs de Vries will have the job of co-ordinating the work of the Council and following up on Council decisions to make the fight against terrorism more effective. He brings a great deal of experience to the job, having been interior Minister for a time in the Netherlands.

The European Council recognises the need to enhance international co-operation. Thedeclaration underlines the central role of the United Nations. It underscores the need to continue to enhance our co-operation with partners, including the United States. In addition, the European Council agreed a declaration on solidarity against terrorism. That highlights an element of the draft constitutional treaty for Europe which commits the member states to act jointly in a spirit of solidarity if one of them is the victim of a terrorist attack. This is, of course, subject to the constitutional requirements of each member state.

The message coming from the EuropeanCouncil meeting was simple. We are building on our existing co-operation. We seek to improve it, and we emphasise the need to implement what we have agreed. We are also looking at what more we can do. Following the session onterrorism, the Intergovernmental Conference considered the draft constitutional treaty. The session was both positive and constructive. There was great appreciation for the Irish Presidency's approach to the IGC. The Taoiseach askedcolleagues to commit themselves to a timeframe in which to bring the IntergovernmentalConference to a conclusion. It was agreed toconclude it no later than the June European Council. That is a remarkable change in affairs since the December European Council, when the atmosphere was entirely negative. It is a verysignificant achievement on the part of the Taoiseach.

Of course, there is still a substantial amount of work to be done in the context of the constitutional treaty. There are complex and important issues to be resolved. However, there is a strong will to find a way forward, and it is understood that there will have to be compromises. In negotiations, nothing is agreed until everything is agreed. I mentioned on a previous occasion in the Seanad that if the political will existed I was confident that the Irish Presidency would find a way of constructing a path through the many difficulties that still face the constitutional treaty. The positive decisions at the European Council have confirmed my views in that regard.

The process of bringing the constitutional treaty to a conclusion is a collective one in which we must all play a part. Everyone has shown some flexibility, and in the discussions that will follow, more compromises will have to be made. The Government would, of course, like to see agreement on the new constitution sooner rather than later. At the same time, the Government fully appreciates that the best possible outcome may require a little time. We should not forget that when we began at the start of the year there were many who said it would not be possible to set a target for the end of the 2004. We now have a commitment to finish the negotiations by June.

While combating terrorism and crafting a constitution for Europe are critically important matters, the spring European Council was originally conceived as an economic summit. In advance of the European Council meeting, the Taoiseach had written to colleagues outlining the Irish Presidency's priorities on the Lisbon Agenda and our approach to making progress on it. The Taoiseach also used bilateral contacts to emphasise the need for a focused agenda, concentrating on the main issues needing to be addressed. The Taoiseach highlighted the fact that overall Europe is well behind target in a number of key areas and that we must now give the highest level of political priority to the critical issue of delivery.

Our approach underlined the importance of stepping up implementation at national level of the commitments to which member states had agreed over the past four years. Fortunately, the climate for delivering on the Lisbon Agenda is improving. The global economy is recovering, and the European Union must position itself to benefit from any upturn.

We decided to concentrate on two urgent priorities, sustainable growth and more and better jobs. One of the problems with the Lisbon agenda to date has been that it has not been well focused. The temptation for every Presidency has been to bring on board its own favourite topic. We took the view that less is better — if we can add some focus, much more progress will be made. The true test of the Lisbon agenda will be whether the European Union will be able to sustain higher levels of growth and employment in 2010 compared to those recorded in 2000.

For growth to occur, the right combination of sound macroeconomic policies and greater competitiveness is needed. To this end the European Council decided the draft directive on services should be agreed so that barriers to the Internal Market, which limited opportunities for business and consumers, would be removed. Services account for approximately 70% of the gross domestic product of the entire Union and yet there is less freedom of movement in this area than in any other. If progress can be achieved in this area and the barriers that prevent the growth of an Internal Market in services are removed, everybody will benefit. Consumers will benefit as of course will the economies in general.

The Heads of State also committed themselves to accelerating regulatory reform, another issue that has been discussed in this House on more than one occasion. There is a problem with Europe regulating itself to stasis and the view of the Irish Presidency is that good governance requires less, or more focused, regulation. I am pleased to point that the Irish Presidency's view on the issue of regulation is shared by Holland, Luxembourg and the United Kingdom, which respectively will host the next three Presidencies. A common Presidency programme has been issued to cover the two-year span, focusing on the issue of regulation. I believe this will have a positive impact.

The European Council also agreed on the need to invest in basic research in the life sciences. The level of private sector investment in research and development in the European Union is far too low. The private sector invests three times more in human capital in Japan and a staggering five times more in the United States than it does in the European Union. All member states have been asked to improve the general conditions for research and development and to consider targeted support and incentives to encourage greater investment by business. The research and development area is obviously critical as Europe wishes to become the world's leading knowledge-based economy by the year 2010.

Growth will not be sustainable if it is coupled with the increased use of finite natural resources. For this reason, the European Council called for the rapid implementation of the environmental technologies action plan. As well as protecting the environment, this plan will contribute to competitiveness and economic growth. The European Council also called for the full implementation of the Kyoto Agreement. It is worth reminding the House that environmental science is one of the key areas of technology that is currently being developed. Europe has an edge and advantage in this area and it should be pursued.

Growth and competitiveness are not ends in themselves. They are means to securing and developing the European social model with its emphasis on sustainability and inclusion. Protecting the most vulnerable members of society is an essential part of the Lisbon agenda. I am pleased that the Council agreed that social cohesion was central to this. The other focus was on jobs. The European Council agreed that the EU's top priority must be to increase the employment rate throughout Europe. Higher employment will not only boost growth, but will also provide the best route out of poverty and social exclusion. The European Council focused on four major challenges, namely, increasing the adaptability of workers and companies, attracting more people into the labour market, improving the quality of employment and investing in human capital.

It was agreed that a detailed response would be undertaken at next year's spring European Council meeting to examine the progress of members states in addressing the employment challenges. The European Council acknowledged that substantial progress had been made in a range of areas that would promote mobility including the European health insurance card. The Taoiseach displayed the first of the European health insurance cards at the Council. In addition, the reform of Security Council regulation 1408, which will protect the social security rights of migrant workers, is an important measure which will be agreed over the coming weeks. This too will be a significant achievement for the Irish EU Presidency.

The European Council also called for political agreement to be reached by June 2004 on directives aimed at making it easier for workers to have their professional qualifications recognised when seeking work in other EU member states. I recall when I was a civil servant in the Department of Finance in 1973, when we first joined the European Union, we discussed the right of establishment of the freedom to move workplace from one place to the next. We talked of the challenge of having a common set of professional qualifications. It is extraordinary that 30 years later this has not been achieved. One of the positive outcomes of the European Council meeting was to indicate a timetable for getting that work concluded, with June 2004 being the projected date. That is very ambitious, but would be a very positive outcome if achieved.

The Government cannot on its own bring about the range of changes required. All stakeholders have a vital role to play. It was also agreed that each member state would establish national reform partnerships in accordance with its own national arrangements and traditions. The states would have to build commitment and legitimacy as a lever for change at national level. We do not often regard ourselves in Ireland as innovators, yet one of the great innovations in recent years has been social partnership. I know there are debates on the extent to which social partnership should be involved in the evolution of policies, yet one must accept that social partnership has been fundamental in creating a more flexible arrangement within the workforce, as well as creating a consensus and agreement on policies which would otherwise have been difficult to deliver. We believe, as does the European Council, that this model can be extended to the European Union.

The Council also looked ahead to 2005, the mid-point in the Lisbon goal and the appropriate time for an in-depth review of delivery. While we all agreed that the continuing validity and relevance of the Lisbon agenda is not in question, we need a comprehensive mid-term evaluation to guide us over the second five years. The European Council therefore invited the Commission to establish an independent high-level group, headed by the former Dutch Prime Minister, Wim Kok, to undertake this evaluation. Wim Kok and his proven track record will provide continuity with the earlier work of the employment task force, given that employment is one of the key areas of the Lisbon agenda.

The European Council discussed Kosovo, Afghanistan and the Middle East, focusing on our partnership with the wider region, and it also discussed Cyprus. European High Representative Solana and Commissioner Patten reported on their visit to Kosovo on 24 March. While the situation appears to have stabilised, the recent outbreak of violence was a major setback. The European Union must try to ensure there is no further descent into the type of ethnic violence which destroyed so many lives throughout the western Balkans over the last 13 years. The European Council reconfirmed its support for Security Council Resolution 1244 and for the policy of standards before status.

The Council welcomed Germany's decision to host the international Afghanistan conference in Berlin on 31 March and 1 April. The people of Afghanistan require a future governed by the principles of freedom, justice, respect for human rights and fair political representation. The Berlin conference marked another step towards securing those objectives.

The Middle East continues to be of grave concern to the European Council. Extrajudicial killings are contrary to international law and undermine the rule of law. The European Union has condemned the killing of Sheikh Ahmed Yassin by Israeli forces. Violence must cease in the region. The European Union called on the people of the region to look beyond the politics of the latest atrocity. They need to summon up the political will necessary to overcome the current impasse in the peace process. The European Council remains convinced that the Quartet road map offers the basis for a lasting peaceful settlement resulting in two viable, sovereign and independent states, Israel and Palestine, based on the borders of 1967.

The Irish Presidency maintains close contact with the leaders of the principal Arab states to ensure the momentum in the peace process is not lost. The Minister for Foreign Affairs, Deputy Cowen, visited Cairo last week where he emphasised the need for a concerted effort to advance our common goals of peace and security in the region through a just resolution of the conflict. The Taoiseach and the Minister for Foreign Affairs intended to represent the Union at an Arab summit in Tunis last week, but it was cancelled.

The European Council expressed the desire of the European Union for partnership with the countries of the Mediterranean and the Middle East. The European Council welcomed the interim report drafted by the Presidency, An EU Strategic Partnership with the Mediterranean and the Middle East, and which was endorsed by Foreign Ministers at the General Affairs and External Relations Council on 22 March. The European Union and the countries of the Mediterranean and the Middle East are neighbours, sharing strategic interests and concerns. Many of these countries face challenges that require far-reaching political, economic and social reform that must come from within. At the same time, the European Union stands ready to help.

The European Council discussed Cyprus, at a time when the UN led negotiations on a settlement were at a critical stage. Heads of State and Government acknowledge the long-standing effort of the UN Secretary General, Mr. Kofi Annan, to create a unique and historic opportunity for a settlement to the Cyprus problem. The Government maintained close contact with the negotiations throughout and continues to be in touch with all parties concerned. It is now up to the people of Cyprus to decide on a plan for a settlement that Mr. Annan presented to the parties on 31 March. At its meeting on 26 March, the European Council reaffirmed its strong preference for the accession of a united Cyprus to the European Union. The European Council reiterated its readiness to accommodate the terms of such a settlement in line with the principles on which the Union is founded. As Members will be aware, if there is no agreement in the two Cypriot referenda, one of the challenges then faced is how to accommodate the arrangements for 1 May. Within these arrangements, there is sufficient flexibility to do that.

The European Council meeting was good and productive. We are now at the half-way point of the Irish Presidency, yet much work remains to be done. As in the past, this term of the Presidency will be judged on its results over the entire six month period and whether it achieved what it set out to do. We can be satisfied with what has been achieved to date and that this good work will be continued.