Averil Power (Fianna Fail)

I welcome the opportunity to comment on the recent referendum result and join Senator Michael Mullins in welcoming the "Yes" vote. While it is one small part of the solution to Ireland and Europe's economic problems, it is an important part. Personally, I was very relieved that people decided to vote "Yes" in the referendum. We discussed many of the arguments before the vote in terms of why a "Yes" vote is important. It provides access to the ESM if we need it. It was a crucial issue in the campaign to have the security and certainty that if we needed access to the European Stability Mechanism, it would be there. That gives us options, even if the ESM is not our only option. Every Member hopes Ireland will be in a position to return to the markets at a good interest rate as early as possible. When the current EU-IMF programme runs out, if the ESM is cheaper than going back to the markets, that is what we should do. Every euro we spend on interest is a euro less we can spend on education, health care and social protection. Access to the ESM is important in that respect.

A "Yes" vote has also sent a positive message to investors. During the campaign, politicians from across the parties were joined by the business community, civic society and a wide range of groups. IBEC conducted a survey of 700 CEOs and 87% of them said a "No" vote would limit Ireland's ability to do business in Europe. In deciding to vote "Yes", the people took cognisance of that fact. The people representing companies employing seven out of ten private sector workers, such as chambers of commerce and small businesses, were also calling for a "Yes" vote. That is one of the reasons people got behind the referendum and decided to vote "Yes".

There was much debate about the rules being put in place over the coming years. Most of the rules that are part of the treaty are already in law and the treaty just improves enforcement but they are quite sensible. With or without the treaty, Ireland must go through a period of closing the gap between income and expenditure over the coming years. We must impose many of these limits on ourselves anyway even if they do not come from Europe. It is in our interest to see that other countries are doing the same. Problems in one European country affect all of us, particularly the eurozone countries. It is in our interest to know that other countries will have balanced budgets, particularly when the Irish people are taking such hard steps and going through such pain to get the economy back on track. We want to know the same is being done in Greece and other countries because it is in our interest. The rules in the treaty are sensible in that respect. There was much scaremongering and misrepresentation on the "No" side, which is unfortunate.

I thank Senator Mullins for his comments about Fianna Fáil's contribution to the campaign. Our party took a principled stance on the referendum. We had a parliamentary party meeting, we thought it through and weighed up the "Yes" and "No" arguments before deciding it was the best thing for the country. Our leader was very strong on this and he put aside party political differences and the opportunity to make capital, something on which other parties focussed strongly. I refer specifically to Sinn Féin, whose campaign was deeply cynical and contained much misrepresentation. On doorsteps, people were being told to vote "No" to water charges and household charges and were told it was a treaty on austerity, as if there would be none without the referendum. That was very unfair because it makes it difficult for people to make up their minds if they are not being given the truth and are subject to misrepresentation. Sinn Féin was criticised by many quarters for running a deeply cynical campaign but, thankfully, most of the people saw through it and decided to vote "Yes".

That does not lessen the issues about which people are worried, such as the impact on families of extra charges. I refer particularly to those on the lowest incomes. That was reflected in the results, along with the worrying turnout. That one in two people did not vote on an issue so important is worrying. The socioeconomic divide was alarming and something of which we must take cognisance. It reflects the fact that certain communities and poorest people were the hardest hit, particularly in the last budget. This happened through DEIS schools and cuts to lone parents allowance. Members of Fianna Fáil and those on the "Yes" side tried to tell people that this was not a referendum on those issues and that we appreciated they were angry and upset. We asked them to put that to one side and vote on it another day. The result reflected the anger and people took the opportunity to vote "No" to send the message to Government.

Through the campaign, we emphasised that this is one aspect of the solution, not the full picture. It is only the start of all the steps that must be taken. In order to supplement the ESM and ensure we have a comprehensive solution to the issues facing Ireland and the EU, we must expand the mandate of the ESM so it can inject funds directly into failing banks. This allows collective support for regional bank crises. It must urgently be addressed if we are to operate as a currency union. The other advantage is that recapitalisation aid would not add to countries' debt levels and would help Governments' chances of raising funds on the private finance markets to fund normal day-to-day operations.

Expansion of the ESM should go hand-in-hand with pan-European regulation. Europe can then collectively take responsibility for banking failures. The Governor of the Central Bank, Professor Honohan, endorsed common banking supervision in his recent statements. It is important to have a Europe-wide deposit protection scheme. Currently, Greek and Spanish savers are moving their money out of local banks for fear the countries will leave the euro and their savings will be redenominated in new drachma or new pesos. Irish savers are lucky that they have the savings guarantee scheme. A common, appropriately funded deposit insurance scheme would eliminate this risk.

In order to have public confidence in where we are going, particularly given the impact on families, there is an urgent need for a mechanism by which senior bondholders in bust banks take some pain for the cost of rescuing them. I agree with most of what Senator Mullins said but I disagree with this point about the approach of the Taoiseach. It is not that other people are exaggerating what is going on in Europe by putting undue pressure on the Taoiseach to reveal his negotiations. The Taoiseach made a big deal of his conversation with Angela Merkel and when he was asked what she said in reply he would not answer. That causes a confidence problem and the Government needs to be careful. Talking up what is going on and making a big deal about presenting a technical paper, which the Taoiseach then admitted he had not seen and did not know if it is being done, damages public confidence. The Government should be careful about that. During the referendum, it came up as an issue that the Taoiseach was not prepared to debate on Vincent Browne's programme. I know what his issue is but I do not mind doing the programme. I was there last night.