Michael Mullins (Fine Gael)

I congratulate the Minister of State and the Taoiseach on the progress they made on two key issues, namely, the jobs and growth agenda and the fiscal compact treaty. I pay tribute to the civil servants who put in long hours over the Christmas period to defend the best interests of this country. We are fortunate to have public servants of the highest calibre.

In the simplest of terms, this treaty is part of Europe's response to the current economic crisis, alongside growth enhancing measures and the firewalls to which the Minister of State referred. It will strengthen the rules underpinning the euro by requiring member states to run balanced budgets and ensure that expenditure is balanced against tax revenue. They will have to reduce their debt to manageable levels. The treaty will help the euro area in particular because it will show the rest of the world that we are serious about the stability of the currency. Everyone will have to play by the rules. Large member states will no longer be able to use their voting weight to wriggle out of their responsibilities. In economic terms, it means that Ireland will be part of a stronger and more credible currency. Future Governments will be not be able to run unsustainable budgetary policies without regard for the long-term consequences of their actions.

Despite the scaremongering, it is clear that the treaty will not impose decades of austerity that we could otherwise avoid. We are already in a stringent programme which will take precedence and we will in any event have to close the gap between spending and taxes to reduce our debt levels. This will require time and hard work. Over the weekend, a number of well-known Irish economists, including Karl Whelan and Alan Ahearne, confirmed that a considerable amount of work will be required before we return to a sustainable footing.

The treaty does not commit member states to a single economic philosophy. It is up to each state to decide how to tax and how to spend. It does not entail permanent interference in our economy. It is right and proper that members of a common currency view their economic policy as a shared concern, and that is already set out in the treaties. Our openness to peer review under the Commission's supervision is a necessary part of that process.

Considerable time was devoted to a discussion on economic recovery and job creation at the recent informal European Council meeting. The Taoiseach highlighted two key concerns which are raised regularly in this House, namely, ensuring access to finance and reducing red tape. These issues will have to be addressed before small and medium enterprises - the engine of economic recovery - can fulfil their potential. Banking behaviour has to be addressed as a matter of urgency. Reference was made on the Order of Business to what happened at Galway Airport. I look forward to the roll-out of the Government's jobs action plan and hope it contains some of the good ideas proposed in this House during our recent debate on employment creation measures. The partial guarantee scheme, micro-finance loan fund and strategic investment fund will help to support bank lending.

This treaty is good for Europe and good for Ireland. I hope the Attorney General comes to an early decision on whether a referendum is required. If she advises that a referendum is necessary, I do not doubt the Irish people will back the treaty in the interest of our country. If she advises that a referendum is not necessary, it would be irresponsible for the Government to waste public money on a referendum that was unnecessary.