John Paul Phelan (Fine Gael)

This is my first opportunity to welcome the Minister of State, Deputy Treacy, in his new capacity as Minister of State with responsibility for European affairs. I will echo many of his remarks on the Bill which the Fine Gael Party fully supports. The Council of Europe Development Bank is not widely known and I was unaware of many of its activities until recently.

As the Minister of State outlined, the Bill will allow Ireland to join the Council of Europe Development Bank and make a contribution towards it. It seeks the approval of the Oireachtas to accept the terms and conditions of membership. Under the terms of membership, agreed by the governing board of the bank, Ireland's subscription to the bank's capital will be €30,515,890, of which €3,368,950 will be "paid-up capital", with the remainder available to the bank in the form of callable capital. Ireland will also be required to make a contribution of slightly less than €9.8 million to the bank's reserves. Ireland's total cash contribution, therefore, will amount to slightly more than €13,132,680, which will be paid in equal instalments of €3.2 million over a four-year period. Payment of the first instalment, which falls due within 30 days of the bank's receipt of Ireland's declaration of accession, has been provided for in the Book of Estimates discussed in the House yesterday.

Membership of the Council of Europe Development Bank is part of the Government's strategy to join a number of development banks, as recommended in the 2002 report of the Ireland Aid review committee.

According to information provided by the bank, it was established in 1956 making it the oldest international financial institution in Europe and the only such institution with an exclusively social vocation. The bank is the financial instrument of the policy of solidarity developed by the Council of Europe. A multilateral development bank placed under the supreme authority of the Council of Europe, the bank nevertheless has full legal status and financial autonomy. By granting loans it participates in the financing of social projects and responds to emergencies, thus contributing to improving living conditions and social cohesion in the less advantaged regions of Europe. Loans are granted in Council of Europe member states.

The bank's fields of action, as defined in its articles of agreement and resolution 1480 (2004) of the administrative council, are structured under three main headings, to which the Minister of State briefly referred. Under the heading of strengthening social integration, the bank plays a role in providing aid to refugees — the Minister of State referred to a project under way in Croatia in this regard. It is also prominent in the areas of social housing and job creation, for example, it recently made a large investment in Germany. Disadvantaged urban areas and rural modernisation are other areas of special interest.

Under the heading of managing the environment, the bank has played a significant role in funding reconstruction work after natural or ecological disasters in various parts of Europe, as well as in the protecting the environment and preserving historic and cultural heritage. The bank's main areas of concern under the heading of developing human capital are education and health.

The bank has assets of approximately €4.5 billion and has awarded more than €20 billion since its inception. Examples of projects funded by the bank include €11 million approved for improvements in health care in Bulgaria; since 1995, the Council of Europe Development Bank has contributed to financing a project for therestructure of the health sector in Bulgaria. This major programme aims to improve the health of the population and increase the efficiency of the health care system. Some might argue that we could take those ideas on board here. The programme addresses four different aspects of the problem, three of which are co-financed by the Council of Europe Development Bank and World Bank. The four areas involve strengthening the capacity for analysis and management in matters of health care policies, rehabilitating almost 1,000 neighbourhood health care centres, rehabilitating blood transfusion centres and improving emergency services throughout Bulgaria.

In Germany, €100 million was approved to provide vocational training which plays an integral part in the fight against youth unemployment. Germany has a widely acknowledged and long-standing tradition of apprenticeships and the Council of Europe Development Bank has financed an innovative project in Bavaria. The programme consists of granting finance to local small and medium-sized enterprises that agree to make additional apprenticeships available for training young people. According to an evaluation carried out by the Landesanstalt fur Aufbaufinanzierung, a Bavarian bank that received financing from the Council of Europe Development Bank, this programme involved over 7,000 small and medium-sized enterprises and led to the creation of over 10,000 apprenticeships, which is very significant by anyone's standards. Studies carried out on the project show that the whole programme played a decisive role in reducing regional unemployment among young people in Bavaria.

The bank provided a considerable sum to help reconstruction following the floods in Hungary in 1998 and 2000. It gave €9.7 million in aid for refugees and migrants in Lithuania to construct and renovate housing for former deportees returning there from the former USSR. It provided €97 million in Poland for reconstruction and flood prevention measures following the horrific flooding in 1997 and 1998. After the earthquake in Slovenia in April 1998, it provided €4.6 million for reconstruction of buildings and infrastructure, and for social housing for dependent elderly persons whose houses were destroyed.

In Spain it provided €6.2 million for the construction and renovation of schools. Between 1996 and 1999, it financed the construction of 109 schools and the renovation of 374 others in Andalucia. Given the potential for strengthening social cohesion in the villages concerned, the construction or renovation of certain schools was undertaken at the request of, and in close collaboration with, parents' or teachers' associations. The social impact has been very clearly felt as the project has benefited 63,000 students, including almost 2,500 children from gypsy or migrant families, and has generated jobs in the construction industry, estimated at 2,000 per year, and in 540 teaching posts. The bank provided vital aid to Turkey following the earthquake there in 1999. The council acts as another bridge towards the full integration of Turkey into a modern democratic European framework.

Fine Gael is proud to support this legislation. We have a record of being pro-Europe in this House and others. At a time when euroscepticism is a growing aspect of politics in this country and throughout the European Union it is apt that we deal with this Bill now. This institution focuses on European integration and social cohesion and I fully support this Bill.