Kathryn Reilly (Sinn Fein) | Oireachtas source

I welcome the Minister of State to the House. The theme of the Irish Presidency is stability, jobs and growth. I would like first to focus on the European Commission economic winter forecast and the statement therein that the eurozone is expected to remain in recession, with a 0.3% contraction in 2013, which is disheartening. Words such as "sluggish, weak, vulnerable, modest and fragile" are frequently mentioned throughout the 140 pages of charts and analysis of the forecast. It also makes reference to a headline rate of 11% unemployment across the eurozone and a sharp increase in long-term joblessness, which is of concern across the EU, with some 45% of people in the EU, and one in two people in eight countries, now unemployed for more than one year.

In the foreword to the winter forecast Marco Buti, head of the Commission's economics department, acknowledged the grave social consequences resulting from the unemployment crisis. It is, however, more dangerous than that. The Commission paper concedes that long-term unemployment is associated with lower employability of jobseekers and lower sensitivity of the labour market to economic upturns. I acknowledge the emphasis being placed on the youth guarantee by the Irish Presidency and the proposed discussions around that issue later this week.

There are no additional resources provided in the Action Plan for Jobs 2013 and only scant reference therein to youth unemployment. How does the Irish Government propose to match EU funding to address the issues of youth unemployment and employment? The Minister of State mentioned in her speech that the Irish Presidency had brokered an agreement with the European Parliament on the two-pack. Under the compromise by the Irish Presidency, the Commission will set up an expert group to examine the creation of a redemption fund, as well as a system of euro bills to replace short-term sovereign debt. The purpose of the redemption fund, which is the brainchild of the German Council of Economic Experts, is to pool all sovereign debt from eurozone countries above the 60% threshold in the Stability and Growth Pact. I would welcome if the Minister of State could provide further details of that proposal, the Irish position on the redemption fund and details of the expert group which is to be established.

As regards what is going on in the European Parliament, the EU executive is supposedly drawing up legislation for the end of 2013 aimed at loosening the rules of the Stability and Growth Pact to allow governments to invest in public infrastructure projects. Perhaps the Minister of State can advise how it is proposed the rules of the Stability and Growth Pact are to be loosened. On Structural and Cohesion Funds - I have raised this issue previously with the Minister of State in committee - can the Minister of State advise if macroeconomic conditionality is still on the table in respect of Cohesion and Structural Funds, what position Ireland is taking in this regard and if it is opposing attachment of such conditionality to European funding, in particular for countries experiencing severe recession and already subject to many cutbacks? I understand this issue is currently under discussion in the European Parliament. However, I would welcome if the Minister of State could provide more detail on macroeconomic conditionality.