Feargal Quinn (Independent) | Oireachtas source

I welcome the Minister of State and I am delighted to have her here. I am particularly pleased to have somebody here who was close to all of the action that took place in recent weeks. I also have a spy in the area. As Members will know, my daughter lives in Paris and she met the Taoiseach during the week. She told him about the high regard that he is held in. It was evidenced by President Hollande when he spoke highly of the Taoiseach and the possibility of striking a deal. His words give us confidence.

There is no such thing as a free lunch in business or politics. Will a deal - whatever it will be - cost us our freedoms and result in a federalised Europe? Is there a danger that a federalised Europe will be created? Can we benefit from a federalised Europe? What dangers are posed by a two-tier Europe which has us on the lower tier? I would be glad to hear the Minister of State's views on the subject.

I will concentrate on the other big development at the EU Council meeting. There was a political willingness to ensure that there is a stable banking system in the entire EU. The creation of a banking union would be a big step towards overcoming the European Union's debt crisis. The European Union leaders advanced towards establishing a single banking supervisor for the eurozone as the first of three pillars for the banking union. It was agreed to start phasing it in next year and it would become operational in their words "probably in the course of 2013." EU officials said that all 6,000 banks - I am impressed by the number - in the euro area would gradually come under the supervision of the European Central Bank by 2014. Banks would receive State aid first and then large cross-border institutions. Most day-to-day oversight would be delegated to national bodies. For the Germans, the direct supervision by the ECB should apply only to banks that present a systemic risk while other financial institutions should be supervised by national authorities. However, the ECG should have the right to supervise if an anomaly is detected. Given the strange happenings in the banking system in recent years I wonder does that include Irish banks as well?

I am particularly interested in a statement made by the Czech Prime Minister last week. He said that his country is prepared to block the creation of a single supervisory system for the European Union's banking sector. Is the Minister of State aware of his statement? Does she see such a development as a problem? For example, the Czechs want to ensure that their national bank would be involved if a western European bank decides to transform a Czech subsidiary into a branch. That would remove a new branch from the supervision of the national bank in the host country.

There is still uncertainty about when the European Stability Mechanism - the eurozone rescue fund - will be permitted to recapitalise banks directly. A development that depends on what they call the effective supervisory system being put in place.

Can I have an update on the ¤120 billion compact for growth in jobs that was adopted in June and put forward by France? It was aimed at breaking the cycle of austerity. Do Members remember it? Only a few months ago President Hollande made the proposal and, in a document released before the summit, Commission President Barroso mentioned that the compact would be launched in 2013 at the latest. The summit mostly focused on banking supervision. Can the Minister of State give us some idea of when the stimulus package might be implemented? How will it support projects in Ireland? What projects will benefit? There have been indications that structural funds have been reallocated to protect bonds and finance transport, telecoms, digital and energy infrastructure but the specifics are vague. I would be glad to get some more information on the matter from the Government.

The Minister of State had been helpful today. Perhaps she will comment on a view provided, on 22 October, by the Financial Times which states:

Mr. Kenny faces a conundrum ahead of Ireland?s scheduled exit from its bailout at the end of 2013. With gross debt creeping up to 120 per cent of gross domestic product and economic growth stalled, does he tell the EU the country?s debt is unsustainable and demand early help? Or should he continue to promote the Celtic comeback story and hope Ireland?s EU partners decide to lessen its debt burden?

Are we playing a risky game? If we do not get enough relief from our debt are we back to square one? What are our other options? These questions will not be answered this week and probably not next month. We need answers and the sooner the better.