Jimmy Deenihan (Kerry North-West Limerick, Fine Gael)

We have made our position quite clear. It is obvious from the Minister's reply that we are trying to protect our corporate tax base. It is the main incentive we offer people to set up in Ireland. We cannot compete with countries like India and countries in eastern Europe in terms of pay. If we did not have our corporate tax rate, which is our main advantage, we would not be doing as well with foreign direct investment. We have spelled that out on several occasions as we have reinforced what the previous Government said on the corporate tax rate. We have made where we stand on the rate quite clear to Europe. We are engaging in this process because we have decided - I remember the discussion at Cabinet level - that it is better to be on the inside than on the outside. We are engaging and reinforcing our point.

We have been good Europeans. We are very good Europeans at the moment. It is hoped that the position we are taking in the interests of the survival of the euro means that Europe will not punish us in this respect. Europe is well aware of our success in attracting American companies, especially Silicon Valley companies, to Ireland as a result of this incentive. Our engagement in this process does not threaten our tax base in any way. In fact, it allows us to reinforce our position. We need to convince people that if we did not have this advantage, we would be in a much worse position at this time. As we all know, any chance this country has of recovering is through exports. If large companies do not come to Ireland to produce goods for export, we will be at a major disadvantage. I appreciate what Senator Daly is saying. I am confident in the ability of the Minister for Finance and the Taoiseach, who have friends in Europe and an understanding of Europe, to protect the tax advantage we currently enjoy.