Seanad debates

Thursday, 14 June 2012

Referendum on the Thirtieth Amendment of the Constitution: Statements


2:00 am

Photo of Michael MullinsMichael Mullins (Fine Gael)
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I welcome the opportunity to make a statement in the aftermath of the recent referendum on the Thirtieth Amendment of the Constitution. All Members - certainly those on this side of the House – welcome the outcome of the referendum. I acknowledge the efforts of the Government parties which campaigned very strongly for a "Yes" vote, as well as the strong support of Fianna Fáil during the course of the campaign to ensure a result that would be in the country's best interests. I must single out the directors of elections who did a tremendous job - the Minister for Agriculture, Food and the Marine, Deputy Simon Coveney, for Fine Gael, the Minister for Social Protection, Deputy Joan Burton, for the Labour Party and Deputy Timmy Dooley for Fianna Fáil. I also recognise the tremendous work done by the Minister of State with responsibility for European Affairs, Deputy Lucinda Creighton, who impressed and convinced the people to vote "Yes" in the referendum. They rejected in an emphatic way the negative "No" campaign which wished to make it a referendum about everything but not what it was supposed to be about. I am pleased the people have taken a positive step in keeping our focus on the economy and ensuring a sustainable track to recovery. I am glad they responded to the hard-fought campaign for several weeks. By endorsing the stability treaty, a crucial part of the jigsaw has been put in place as we rebuild a working Ireland. The result will help to bring about the certainty needed for recovery and growth.

The "Yes" vote represents a positive move by Ireland on several fronts. We are sending a strong message to international investors that Ireland is a sound and solid economy in which to invest and create jobs. Thousands of jobs have been created since the beginning of the year, 1,200 of them in County Galway, a fact with which I am pleased. The result of the referendum will help us to maintain this stream of investment. With 445,000 people unemployed, we need to keep the emphasis on job creation and attract foreign direct investment.

The other issue which arose during the campaign was whether Ireland would have access to other funds at the end of 2013. We now have the security and certainty of knowing that, in the event of us needing additional emergency funding, it will be available to us and that we will be in a position to pay doctors, teachers and nurses in the years ahead. The stability treaty will ensure future Governments, irrespective of which parties are in power, will have to adhere to sensible budgeting rules, which is in our best interests. As we gradually reduce our debt levels in the next few years, we will have more money to spend on public services such as schools and hospitals.

Addressing our debt levels was the main issue in the campaign. The Government will continue to ensure any proposal advanced at EU level will be in Ireland's interests as well as those of the European Union. We will be watching developments in Spain, while the elections in Greece this weekend could have serious implications for the euro and the eurozone. The Government will strongly support any proposal which will help to ease Ireland and Europe's debt crisis. It has stated the need to break the link between bank and sovereign debt, a key element of our banking strategy. It has actively proposed this approach at European summits. Throughout 2011 the Minister for Finance, Deputy Michael Noonan, set out his position at and after ECOFIN meetings that the ESM, European Stability Mechanism, or other European funds should be directly investing capital in banks in return for equity.

We have also pointed to the obvious benefits of an EU level approach to bank recapitalisation as not impacting on the general government debt of member states. Members will be aware that the managing director of the International Monetary Fund, Christine Lagarde, has stated there needs to be a separation of banks and state in the provision of assistance, which is a welcome approach. The outcome of the recent referendum has strengthened the Government's hand when it comes to these discussions and negotiations. Members will appreciate why the Taoiseach at times cannot be overly forthcoming on some of the negotiations at both ministerial and official level.

Photo of Averil PowerAveril Power (Fianna Fail)
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The Senator is being very generous to the Taoiseach.

Photo of Michael MullinsMichael Mullins (Fine Gael)
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In time, I have no doubt the Government will secure a successful outcome to the negotiations on the debt crisis.

I thank the people for the strong support they gave in the referendum. I was pleased that in Galway East almost 64% voted in favour of the treaty. It will not solve all of the country's problems, but it gives us grounds to continue the work of economic recovery commenced by the Government. I appreciate the support given to us in the campaign by Fianna Fáil, the business and farming communities. The people realised it was in the country's best interest which, as a Government representative, I greatly appreciate.

Photo of Averil PowerAveril Power (Fianna Fail)
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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.

Photo of Michael MullinsMichael Mullins (Fine Gael)
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Senator Power did very well.

Photo of Averil PowerAveril Power (Fianna Fail)
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I know the Taoiseach is not keen on doing it. It is important for people at home to have reassurance that the Government is on top of its game and is happy to answer all questions. It makes it easier for people to go about their own business and be reassured that people know what they are doing. I welcome the "Yes" vote but other steps must be taken.

Photo of Fidelma Healy EamesFidelma Healy Eames (Fine Gael)
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I welcome this debate - it is good to reflect after the vote. Often, we have many debates leading up to the treaty but we do not take stock afterwards. Like the two previous speakers, I am delighted to be able to say today that we got the result Ireland needed in this referendum. The stability treaty received a resounding "Yes" vote. Many people are asking what comes next. As we said throughout the campaign, the stability treaty is not the solution to all our ills or all the economic problems of the EU, but it is a significant piece of that solution. Stability cannot be under-estimated. A group of people told me that Chinese investors are showing a major interest in Europe but are nervous of the eurozone. The sale of renewable assets worth €100 million was proposed recently in Italy. Analysts and financiers were recommending it. The due diligence was done. The Chinese board that wanted to buy the assets ultimately decided to hold off on the purchase. They decided now is not the time because Europe is not in a safe place. This is why stability is important and why it was irresponsible of the "No" campaign to try to reject it. We cannot begin to grow until we have economic and political stability. That is a critical piece in the jigsaw.

Now that we have accepted the treaty, we will continue to take further steps to resolve the crisis in co-operation with our EU partners. Many possible solutions and proposals have already been tabled since the referendum. At the last informal EU summit, the President of the European Council, Mr. Van Rompuy, was tasked with preparing a new growth plan. That summit took place a few days before the referendum on the treaty. The new President of France, Mr. Hollande, managed to get eurobonds on the table for discussion, which was a large step towards finding a solution. I believe that in the near future, eurobonds will come into existence to deal with Europe's debt problems. To be fair to the Minister for Finance and the Taoiseach, they have been pursuing a growth narrative for some time. It cannot all be about fiscal rectitude. The election of Mr. Hollande was needed for that approach to become part of the dialogue. Matters are heightened during election campaigns.

Brussels has asserted that banks should pay for banks. I was glad to hear that. Under the proposal from the Commission, banks will be obliged to draw up recovery plans that will kick into place if their finances deteriorate. It is proposed that national authorities will be able to appoint special managers to oversee weak institutions. For many people who are suffering during this economic crisis, the most serious proposal is that senior bondholders should be made liable for the costs of bailing out a lender. Many of us might think this is a late development, but it is definitely a positive one. It is obvious that this has yet to go through the legislative process. We have also heard about the possibility of a banking union. We have to realise that Ireland is a member of a union. We have a common currency, so why should we not have a common banking union? This is not about our national sovereignty or our identity as a nation. Ireland is an island nation on the west coast of Europe. We have bought into the euro. I do not suggest it is not flawed. I think the way it was set up at the outset was flawed. We are now trying to correct many of those problems. That was one of the reasons for the introduction of the stability treaty.

There is a great deal of merit in examining the possibility of a banking union across Europe. If a bank in Philadelphia goes down, it is not the people of the state of Pennsylvania who have to rescue the bank - it is the people of the United States. If that type of process had been in place here, the Irish people would not have had to bail out Anglo Irish Bank. It would have been done by the people of the EU as a whole. One might argue that would have caused things to move on to another country and another bank. I do not think that is necessarily the case. If that type of cross-border responsibility existed, we would have far stricter banking regulation. This country is in this mess because there was light regulation and no regulation. We were too small. It was such a cosy cartel. There was an inner circle. They were not doing their job. We know that story. There is a great deal of merit in having regulation that does not destabilise the entire economy of Europe, which is what we are seeing now with banks in Ireland and across Europe.

The President of the European Commission, Mr. Barroso, has proposed that there should be further and deeper political and economic union. Regardless of whether we agree with the deepening of the union, at least we are still at the table as a consequence of our "Yes" vote. That puts us in a position to influence the economic decisions made in the eurozone and allows us to choose to participate in these and other developments. I would like to see a deal on bank debt. I hope the Commission will make proposals to further that cause. I would like such a deal to be retrospective so that Ireland's bank debt could be eased. If the Commission proposes that banks should pay for banks - if banks are responsible for banks - our bargaining hand will be strengthened. The Minister for Finance, Deputy Noonan, knows the Irish people are not suckers. I know it. We all know it. We also know that a deal on bank debt will have to be reached at some stage. We will need to show patience as we wait for the right moment. Perhaps we will not have our strongest negotiating hand as long as we are still in our current programme. In the last few days, the president of the European Central Bank, Mr. Draghi, has said that Ireland is almost ready to return to the bond markets. When that happens, we will be more independent again. Perhaps that will also allow us to be stronger on the whole promissory note bank debt deal.

I would like to speak about the High Court case that was taken by Deputy Pearse Doherty of Sinn Féin against the Referendum Commission and the question of whether it constituted an abuse of the judicial system for political gain. The cost to the taxpayer of the case is approaching €200,000. In my view, this is an abuse. The case was brought against the commission late in the campaign. It was close to the date of the referendum. It seems obvious that the case was a political stunt. If the High Court had found against the Referendum Commission, it would not have changed the fact that a "Yes" vote was still best for Ireland. Obviously, it would not have had any bearing on what the treaty actually means for us. There may not have been sufficient time between the High Court ruling and the date of the referendum to clarify the issue to the Irish people. In essence, it would have caused massive confusion. Little or no time would have remained to explain the issues involved. Clearly, the case was taken in order to increase doubt and confusion.

I recognise that it is difficult to speak about this issue without slipping back into the debates we had during the campaign. Issues concerning the campaign itself must be addressed. There was a negative aspect to this referendum, which was characterised by people being against the treaty as an expression of dissatisfaction with the Government. This may have been represented more strongly in this referendum campaign than in others. It is a very dangerous way to think about whether to approve an international treaty, especially one with such serious consequences for the economic future of our country. Treaties like the stability treaty should be examined on their own merits.

I accept that those on the "No" side had every right to campaign for the defeat of this referendum. As they are not part of the Government, however, they would not have been responsible for dealing with the catastrophic uncertainty that would have stemmed from a "No" vote. That fear would have continued for 18 months until we found out whether we could fund ourselves into the future. They offered no real alternative way forward. They advocated the rejection of a treaty that represents a real step forward for Ireland and offers us a safety net should we need it. They wanted to reject it out of hand. The Irish electorate needs to consider who would be responsible for the outcome of such a vote. When one proposes that the people should vote in a certain way, one should be willing to take responsibility for ensuring the outcome of the vote is put in place. The "Yes" side had all of the responsibility in this case.

Photo of Sean BarrettSean Barrett (Independent)
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When I proposed the Fiscal Responsibility (Statement) Bill 2011 in December of last year, it received wide support in this House. The problem with the recent referendum is that it was an attempt to make a fiscal response to a monetary problem. As Senator Healy Eames and others have said, the design faults in the euro destroyed the banking system which we then bailed out. The report of the Comptroller and Auditor General shows 676 people borrowed €67 billion and took out 35,000 mortgages. Those are the numbers. I am afraid we will end up in another crisis because of the design faults in the euro. The single currency does not have an exit mechanism and does not cater for a scenario in which a large country such as Germany provides a tsunami of credit to a small country such as Ireland. In addition, members lose the power to use the exchange rate and interest rate as instruments of economic policy and banking regulation is lacking. The Government needs to strengthen its economic service to avoid making the same mistake again. Milton Friedman and other economists warned that we were joining a system that was bound to fail. We threw away the key when we did not provide for an exit mechanism.

Now that we have the results of the referendum, we must move on and become much more insistent and outspoken at eurozone meetings. If we have evidence from some of the best economists in the world that the euro is fatally flawed, let us not allow a series of countries to go bankrupt simply because people in Brussels do not want to admit their mistakes. Greece, Spain, Portugal and Ireland have already suffered and Italy and Cyprus are next in line. It would be ill advised of any eastern European country to join the euro at this stage. The United Kingdom, Sweden and Denmark were very wise to remain outside the currency.

I am dismayed to hear reports that delegates or Ministers met for a working dinner. There have been 18 summits. If one's bus does not arrive in the morning, one cannot use the excuse that the bus driver was having a working breakfast. We need to increase the level of economic expertise in the Government and in Brussels and Frankfurt. The 40% of the population who voted against the fiscal treaty in the referendum did so because the failures of the past have had terrible consequences for the unemployed and those on low incomes. Even the International Monetary Fund is concerned that the burden is not being spread fairly between, as it were, the haves and have-nots. Massive economic mistakes have caused such misery through unemployment, emigration and so forth that we must be certain that legislation coming before the House is properly costed and debated. The Seanad, with its 42 new Members, will ensure this is done but we must also ensure we do not sleepwalk into any other agreements that become impossible to adhere to.

We need to strengthen the economic advice available to the Government economic and improve our performance when we attend international meetings. We have experienced the biggest economic disaster ever to hit the State. Those who founded the State in 1922 and those who succeeded them until 1972 were parsimonious in their running of the public finances. While we made mistakes in the period from 1972 until 1987, we also learned lessons and reduced the national debt as a percentage of GDP to approximately 25%. We had too much faith in a badly designed single currency. As the former Commission President, Jacques Delors, has pointed out, the euro was not the currency he wanted. I fear other countries will get into trouble or Ireland will need a second bailout unless someone from Ireland brings the message to Brussels that we must address the design faults in the euro, which have had appalling consequences for wider society.

We need to strengthen the economic advice available to the Government economic and improve our performance when we attend international meetings. We have experienced the biggest economic disaster ever to hit the State. Those who founded the State in 1922 and those who succeeded them until 1972 were parsimonious in their running of the public finances. While we made mistakes in the period from 1972 until 1987, we also learned lessons and reduced the national debt as a percentage of GDP to approximately 25%. We had too much faith in a badly designed single currency. As the former Commission President, Jacques Delors, has pointed out, the euro was not the currency he wanted. I fear other countries will get into trouble or Ireland will need a second bailout unless someone from Ireland brings the message to Brussels that we must address the design faults in the euro, which have had appalling consequences for wider society.

Photo of Ivana BacikIvana Bacik (Independent)
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I welcome the opportunity to contribute to this timely debate, coming as it does two weeks to the day since the referendum on the stability treaty was passed on 31 May. This is an appropriate time for reflection on the consequences of the referendum and for a prognosis on what to do next. Listening to Senator Barrett, I am conscious that even in this two week period, dramatic developments have taken place across the eurozone, specifically the recent events in Spain, and we also have the prospect of similar outcomes for Italy and Cyprus. These developments remind us of the importance of trying to shore up the eurozone and ensuring we have a common set of financial or fiscal targets. Of greater importance is the need to ensure we are bound into an agreement that allows us, if necessary, to access the European Stability Mechanism on communally agreed terms. That is one of the major strengths of the stability treaty.

Like many Senators, I did a good deal of door to door canvassing in the weeks preceding the referendum on the treaty, during which I got a sense of the frustration and anger many people are feeling. I certainly encountered it in Dublin South-East where I was canvassing. What ultimately won through was an almost frustrated acceptance that the treaty was the best option available. Nobody, including those who were canvassing for the treaty, suggested it would be some sort of panacea or would provide the solution to our economic troubles or the recession. The argument we made, the one that won through most powerfully, was that the treaty was an important step and a piece in the jigsaw as we seek to ensure the stability of the eurozone and thus the stability and prospect of recovery for the Irish economy. As others noted, the result was a very decisive "Yes" vote of 60% against a "No" vote of 40%. Many of us believed in the final days of the campaign that the outcome would be much closer and it was a relief to those of us on the "Yes" side that the referendum was passed by such a decisive majority. What the campaign taught all of us, on both sides, was that people require some sense of a positive outlook. The concern and frustration arising from the effects of austerity can be offset if people believe the prospects for recovery are good, there is a way forward and they can see a glimmer of hope.

The European Commission's forecasts for the economy are positive and Ireland is on target to meet the 8.6% deficit target for 2012 and reduce the deficit to below 3% by 2015. The forecasts show a pathway out of our current difficulties towards economic recovery and the prospects for reaching our targets are good. As I stated, however, gloomy forecasts from elsewhere in the eurozone present a problem for us given our strong reliance on exports. The export sector is driving growth and recovery. Our difficulty lies in trying to restore domestic confidence. We see the loss of confidence in job losses in the retail sector and other parts of the domestic economy. To get people spending again we must create confidence among Irish consumers. I share President Michael D. Higgins's dislike of the term "consumer" and I much prefer the far more inclusive term "citizens". I use the former deliberately because the difficulty we are experiencing is a lack of spending in the economy. This is presenting a serious problem for the retail sector and other businesses that are experiencing the knock-on effects. In light of the necessity to build domestic confidence, comments such as the suggestion made by the Minister for Transport, Tourism and Sport, Deputy Varadkar, that there may be compulsory redundancies in the public sector are unhelpful. Such statements can undermine confidence among public servants who have already experienced significant cuts to their wages and are fearful of further cuts in future. It is important that we maintain confidence among those who are still capable of spending in the economy.

The Minister for Social Protection, Deputy Burton, has stated on a number of occasions that the social welfare budget should be seen as a massive stimulus in the economy. The payments people receive stimulate local economies because such a large part of them are spent in the local community. We need to build on this idea of social expenditure as a stimulus.

To be a little more positive about the European context, the victory of François Hollande and his socialist party in recent elections in France has brought about an increased emphasis on the need to introduce stimulus and growth policies alongside the fiscal targets that have been set in the stability treaty. Ireland strongly supports President Hollande's plans to generate a stronger growth package in the European Union. We need to push forward on this matter because it is a tangible means of enhancing confidence in our prospects for recovery. We are in good shape for going back to the markets at the end of 2013, provided we can restore domestic confidence and can keep on the steady path to recovery. The passing of the referendum on the stability treaty has been an important step on that journey for us. We need to keep on a steady path and to ensure that the actions we take as legislators and the policies we adopt are designed to ensure the restoration and maintenance of confidence so that we remain on the path to recovery.

These are the comments that occur to me in reflecting two weeks after the passing of the referendum by such a decisive majority. Nobody suggests the referendum is a solution or that it marks the end of anything. Rather, it is the beginning of the next stage of the journey towards the economic recovery on which we have now embarked. I know that everyone in the House is hopeful of seeing that happen.

Photo of Thomas ByrneThomas Byrne (Fianna Fail)
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I am glad this debate is taking place today. We could be tempted to look back at the success of the referendum campaign and expect that any future referenda on developments in Europe will be passed as easily, but that is not the case. On this occasion people held their breath and voted "Yes" because they felt they had to. There is much happening in the European Union currently. We have seen a proposal for eurobonds and the German version of that proposal. There have also been proposals for further fiscal and banking integration. Some of these proposals may well require a referendum here, but we will not know for sure until a treaty is put together incorporating the proposals. As normal, the Attorney General will then advise as to whether a referendum is required.

It will be necessary for a different approach to be taken with regard to a future referendum and the Taoiseach must be more engaged in the process. We cannot take anything for granted and the people want to hear the leader of their country engage on the issues. There should also be equality of media time for the opposing factions. It is only fair that both sides have equal coverage. However, it is unfair for referenda campaigns to be used as an opportunity by some parties, particularly smaller political parties, to jockey for position and advantage and for them to get inordinate media time to do that. This issue must be addressed. While it is fair that the "Yes" and "No" sides get equal coverage for a referendum, there is a case to be made that where parties get disproportionate coverage during a referendum campaign, that coverage will be examined in the overall context of coverage over the calendar year so that coverage can be balanced between parties. It is galling to see unelected MEPs getting huge coverage on television that will enhance their profiles. During the recent campaign, unelected members of Sinn Féin also got huge profile coverage on television that may be helpful in future election campaigns. It is unfair for them to get such advantages during referendum campaigns and if it happens, this should be balanced out throughout the year by the radio and television companies when they come to analyse their coverage and whether it is fair and balanced in accordance with the legislation. This issue is urgent and what I suggest might be a way of dealing with it, without diverting from the issue of fairness in a referendum campaign. It is not right for the Government to use all of its resources either to promote one side or other in a campaign. These issues must be considered and addressed urgently.

I wish to pay tribute to the Referendum Commission, which has done a good job since the second Lisbon treaty referendum. Its work has been helped by the excellence of the judges appointed to it and of its members, including the Clerks of the Dáil and Seanad. The commission has educated the public and has sometimes contradicted what the political establishment has said. It is healthy that people get such information in a democracy. However, it is not healthy that certain parties deliberately muddy the waters and contradict what is being said by the Referendum Commission. All sorts of allegations were made that the Referendum Commission was wrong and that it was issuing wrong information. A case was taken to court at the last moment, but it was not accepted because the argument was not made. However, sufficient confusion was sown as to cast doubt in the minds of certain voters. I have no doubt but that the court case had an effect. It might not have had the effect desired by Sinn Féin, but it did reduce turnout.

There are lessons to be learned. We need a major public information campaign in advance of any future referenda. We also need more engagement with opposition parties than was the case in the most recent referendum. When Minister, Deputy Micheál Martin engaged proactively with opposition parties in previous referenda. Not only do the Government parties need to engage with other parties, they also need to engage with the public so as to bring people with them. At the time of the debate on the Lisbon treaty, we had the Constitutional Convention on the Future of Europe, which included representatives from all countries and civil society which met and came up with proposals that eventually led to the acceptance of the treaty. That helped bring people along. While the Forum on Europe became unwieldy to some extent and holding its meetings in Dublin Castle was probably not the best way to engage with the public, it was a place where the representatives of the public and civil society could come together and debate Ireland's future in Europe. We need something like that urgently, because if we are to solve the euro crisis, major changes lie ahead of us.

Photo of Kathryn ReillyKathryn Reilly (Sinn Fein)
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I welcome this debate. It is good to be able to reflect on what was a long campaign and for us to be able to go back and talk to people we canvassed and worked with during it and bring their views here. Referendum day was the people's day and they spoke out clearly in favour of the treaty. I was proud to play a role in Sinn Féin's campaign against the treaty. We mapped out an alternative and we went from door to door to try and convince people we were right, but the fear of the people won out in the end. Although the turnout was low, I commend all those people who used their democratic right and voted on the day. It is important people exercise their right to vote, particularly considering that only a small number of people across the European Union got to vote on the treaty.

The campaign was an unsavoury one in some ways. For example, the Labour Party was campaigning, from the top down in particular, for rules that some of its own MEPs vehemently rejected not so long ago. Also unsavoury was the sight of Fianna Fáil preaching about putting the country first and advising us the treaty was in our economic interest. However, they had the right to do that, just as Sinn Féin had the right to put forward an alternative. I disagree with Senator Byrne with regard to restricting media coverage or trying to moderate it or balance it out over the course of a year with regard to parties that get disproportionate coverage in referendum campaigns in the context of the side they are on, whether "Yes" or "No". We do not want to introduce a section 31 that will muffle who appears on television or who can be seen, just because they belong to a smaller party or because those put forward to speak are not elected representatives.

We will continue to put forward our alternative. We will not stop arguing against austerity because we believe it has failed and will continue to fail and this was the basis of our argument throughout the referendum debate. We will not stop arguing for the promotion and protection of Irish sovereignty. Some 40% of the people agreed with our analysis that this is a bad treaty and they rejected it. It is important to note that the number of those who rejected the treaty was higher among those classes of society who the Government has decided should shoulder the burden of the mistakes of others. For example, working class areas voted "No" in general. The people of Dublin North-West wisely rejected the advice of the two Labour Deputies in that area. The people of County Donegal in which there is a huge rate of youth unemployment and emigration also decided that this would not be in their interests either. They will be proved right in the future. I also note the anecdotal evidence that young people voted "No", something that does not surprise me, given that this generation is increasingly rejecting the notion that it should suffer for the mistakes of its elders. All in all, these results point towards the establishment moving further away from the interests of young people and working people and only reluctantly dragging enough of the remainder to scrape by this test.

The purpose of this debate is to discuss the way forward. The "Yes" side has a lot of promises to keep and we will not let it off the hook that easily. When we talk about cynicism and misrepresentation during the referendum campaign, we need to look at some of the promises made by the "Yes" side. We were promised jobs during the Lisbon treaty debate and we all know how things turned out. Only one week after the latest referendum result Pfizer in Cork announced that it was laying off almost 200 workers. Had we not already been told by international CEOs, including the managing director of Pfizer, that multinational corporations were awaiting our decision before deciding whether to invest in Ireland? We gave them a "Yes" decision, but we are still losing jobs in these big companies. Since the referendum, there has been a round of redundancies in my county, with the closure of Flair International in Bailieborough. I accept that it will be some time before the true effects of the treaty will be seen, but the early signs for job creation are not promising.

What about the stability we were promised? Some €100 billion has been pumped into Spanish banks and their bond rates have spiked. The eurozone has never been more unstable. Stability comes from investment and employment in a working society, not from bailout treaties that shift power and money from working people to a protected class of capitalists.

What about the slogan "Yes for investment"? The rhetoric from the European Union and the Government has been grand and flowery, but what concrete measures have been promised? We have seen the announcement of microscopic project bonds and heard some talk about an extra €10 billion lending facility for the EIB, but this €10 billion stimulus package for a European Union of 500 million people should be compared with the €100 billion given for a handful of Spanish banks. I do not think this adds up. The reality is that we are sitting on a potential €5 billion investment fund from the National Pension Reserve Fund. If that was coupled with the billions of euro being paid out to Anglo Irish Bank, we would have the basis for an indigenous stimulus package that could be used to fund the creation of a world class broadband system, the eco-fitting of homes or help businesses the length of the State to create short, medium and long-term employment for young people. However, like the other promises made to get us out to vote on referendum day, the "Yes for investment" slogan is just as shallow as "Yes for Stability".

We were told that a "Yes" vote would strengthen the Government's hand in negotiating a better deal on our bank debt. It was not long, however, before we got our answer on that one. By signing up to this austerity rule book, we have weakened our hand and tied the hands of future, better Governments, although there will always be different opinions on that one.

The people have spoken on the treaty and that is their democratic right. Irish citizens who reside on this part of the island and who have not emigrated because of the failed economic policies to date are the only ones in Europe who were given the chance to use their democratic right to vote on the treaty. We have to wonder where is the democratic scrutiny of such matters. Those of us who opposed the treaty as a further giveaway of our economic sovereignty will continue to organise and resist the current failed policies and provide an alternative. The alternative is a responsive and democratic European Union which respects the rights of states to control their own economic policies. It is a Union that does not just do press releases on issues of major importance such as youth unemployment but actually starts to tackle them seriously and provide for real solidarity, not threats to member states in difficultu.

Photo of Paul BradfordPaul Bradford (Fine Gael)
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I am glad to have the opportunity to reflect on the outcome of the vote that took place a fortnight ago. This is a useful debate and we need to revisit the issue in a more substantial fashion. There was a major parliamentary and civic society debate following the first Nice treaty referendum. Now that people have voted "Yes", perhaps we do not see the need for such a debate, but it is important that we look at the circumstances surrounding the referendum and figure out the lessons we can learn.

The first point we must acknowledge is that a fortnight ago about 30% of the people voted "Yes" in favour of the fiscal compact treaty, about 20% voted "No" and almost 50% said they did not know or care enough to vote. The fact is that 30% decided to chart our course in a certain direction. While I am happy with the direction chosen, I would be much happier if the turnout and the mandate were greater. I have said previously from both sides of the House that in any vote - in a referendum, local, general or European elections - we must ensure everybody is facilitated to the maximum extent possible to cast his or her vote and exercise his or her franchise. We have to live up to the commitments we have all made individually and collectively to allow weekend voting, either on a Friday or a Saturday, which would facilitate a larger number of people, especially young people, to vote. When we ask the people to exercise their right to vote, we deem this to be a significant step. We should, therefore, facilitate them by allowing the vote to take place over a day and a half - for half a day on Friday and all day Saturday. I look forward to the day when we can have a referendum turnout of 75%. If the trends continue and less than 50% of the people vote in a referendum, we will have to consider compulsory voting, as happens across much of the globe. Compulsory voting is not necessary or desirable, but we certainly have to try to increase the turnout by facilitating people through weekend voting. Having said this, the votes have been cast and we must move on.

Senator Byrne mentioned the campaign and the constitutional requirement for balanced coverage. I agree with the Senator in one sense, but subjects could come down the line to be decided by way of referendum, whether it be the children's Bill or other legislation. In the late 1970s and early 1980s there were referendums on such issues as changing the adoption laws in which there was probably a 95% "Yes" vote. We have to provide for balance and regardless of how substantial the political argument is on one side of the equation, the level of coverage is supposed to be 50-50. We will have to look at a methodology to ensure that balance and fairness but not necessarily in the ways we have seen in recent referendums. There is much merit in the Senator's suggestion that the people who take the liberty to support one side of the argument in order to increase their personal or party profile should be moderated in terms of political coverage over a 12 month period. That is a very interesting suggestion which needs to be taken on board.

The next fortnight will be a defining period for the peoples of Europe. The people of Greece will vote on Sunday. It is difficult to know how things will turn out because, happily, opinion polls are banned in Greece in the two week period before an election. Apart from the Greek elections, the difficulties in Spain and throughout the eurozone and the European Union, there are major challenges facing the European political establishment. We really are all in this together. There is so much debate about the euro as a currency - we just look at the economics of it - but we are probably not focusing enough on the politics of Europe, as we did in the 1970s and the 1980s. If we think back to those years and even to the European political institutions of the 1960s, there was a different approach because there was a bigger political picture on display. In the late 1960s and early 1970s the picture being worked upon was the building of the European Economic Community. In the late 1970s and early 1980s Europe was trying to survive and develop in the middle of the Cold War between the East and the West. Then we had the fall of the Berlin Wall and the end of communism, followed by the rebuilding of Germany and the continent of Europe. That was a massive political prize and it brought out the best in the outstanding European leaders of the time, including Helmut Kohl, Jacques Delors and François Mitterand. People of different persuasions worked to create a bigger political prize. We are lacking that political leadership in Europe now. It is more about management of the current crisis, which is obviously necessary, but we do not seem to see that there is a bigger picture or even want to create one. If we travel back 30 or 40 years, we can see what that picture was: getting the countries of Europe to work together, building the original EEC and then the bigger European Union, moving on to the Maastricht treaty, uniting the continent of Europe and developing a currency. People were working towards that political space simultaneously with economic development. Now we do not seem to see a bigger political picture, but we need to work towards one. Every European citizen needs to be part of one political project. We have brought the peoples of Europe more or less together with one European currency, but we have not brought them together politically, which is necessary. Perhaps there was a view that having a single currency would somehow unite the countries of Europe and result in a certain level of balanced economic development all over the continent. That has not worked and I do not think it can work without political leadership and direction. Some will say the only answer to my question is finding some type of federal solution such as a united states of Europe. That is a step that can only be considered down the line. However, there must be increased closeness among the European family of nations. That is what we must reflect on.

Europe's proudest achievements will stand and we must continue to acclaim the bringing together of a continent that had been at war - a continent in which countries spilled each other's blood and millions of citizens died. We brought an end to war and brought people together. The next phase must be ongoing political integration to a higher but acceptable level. Considering from where we have travelled over 30 or 40 years, it is obvious that this must be the project for the next 15 or 20 years. However, it must be driven by sound, dynamic, visionary political leadership which is lacking throughout the European Union. This is urgently required, starting in the next number of years because massive challenges lie ahead.

I welcome the result of the referendum, although I am disappointed about the turnout. I do not think the political establishment sought to engage people sufficiently. The choice of date for the referendum was not helpful either. There are lessons to be learned in this regard. If we want to bring people together on a difficult and rocky political journey, we must engage with them and persuade them to join us. I commend all those involved in the campaign on all sides. They worked hard. It is disappointing, however, that barely half of those eligible decided to vote.

Photo of Caít KeaneCaít Keane (Fine Gael)
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Much has been said about the overall referendum campaign. It is good that there was a "Yes" vote, but it was bad that many people who should have come out to vote did not do so. However, that is their right. The Government was complimented on its information campaign. In the last three referendums the Government was criticised for the lack of information provided for citizens. There are people who will not read what they receive and will still say they are not informed or ill-informed.

I want to concentrate on the issue of misinformation. The Government's hands are tied because of previous judgments. Let us consider a hypothetical scenario. Let us say in another referendum down the line all parties, including Sinn Féin, the Labour Party, Fianna Fáil and Fine Gael, are for the proposal, but there are two Independents - Deputy Luke 'Ming' Flanagan, Deputy Mick Wallace or whoever else - who decide to advocate a "No" vote. I would like to talk about the McKenna and Coughlan judgments in this regard. It is time they were revisited. I am not criticising any judge in this regard, but a 28 page judgment is too short for such a serious issue. I would write 28 pages, as would the children in the Visitors Gallery for an essay. These judgments have serious implications for every citizen of the State. Did the Supreme Court do a persuasive job when it ordered RTE to hold the scales equally between the different views? It should have put more thought into it and I would say the answer is "No". It did not do a good job in that regard and I would like to see a better job being done on these two judgments.

The McKenna judgment barred the Government from using taxpayers' money when making its case in a referendum. The four judges who bound the Government in that way thought this could be done in 28 pages, yet we have the likes of Ganley's Libertas "party" - it is actually a group of individuals - which can use any amount of money it likes. There is no judgment to prevent the likes of these individuals from going to every single country in Europe, raising whatever amount of money they can and spending it. They must report it under the ethics in public office provisions, but I would like to see this issue being examined. It is a serious problem that people such as Declan Ganley can do this. There are other moneys coming from America or republicans, socialists or whoever that can be made available through other parties. Everything spent in an election is accountable, reportable and so on. However, the hands of the Government are tied, as are those of Opposition parties.

I do not blame people for saying they find themselves misinformed. RTE is bound to give 50% coverage to the "Yes" side and 50% to the "No" side, regardless of how valid the arguments are. Who would be left to pick up the pieces in the ESM scenario if we could not draw down moneys? I heard Senator Fidelma Healy Eames ask this question earlier. I hope we will never need it, but we might. This responsibility must be taken into consideration.

The Hamilton judgment boiled down to the assertion that "the action of the Government in expending public funds on the promotion of a campaign was not an action in pursuance of the executive power of the State". The campaign referred to was the 1995 divorce referendum campaign, yet the judgment did not go on to define the executive powers of the State. Judges need to be asked to define them. What is an executive power of the State? In the 28 pages this issue was not dealt with. It is a major flaw in the rule on 50-50 representation. Judges need to define exactly what they mean. Is it because of EU regulations? Of course, EU regulations are linked with the executive power of the State, but why are we bound by environmental EU legislation and many other EU provisions? That is a question I would like to have answered.

One of the five judges who heard the McKenna case - I will not mention names - thought the whole thing was preposterous. He took less than four paragraphs to state that neither the Constitution nor the nitty-gritty of the Referendum Act stated anything that could be read as blocking the Dáil from giving the Government cash to make its case. It was one of the judges who made that statement and he wrote only about half a page, although I might be doing him a disservice.

I read an article on this subject by John-Paul McCarthy and I am grateful to him for bringing it to my attention.

As I listened to the referendum debates I wondered if almost every elected representative supported the "Yes" argument and one Member stood up in the Dáil and said, "I have a right to say no," whether that point of view should receive 50% of broadcasting time? We must consider the Coughlan judgment, as well as the McKenna judgment. None of the four judges who worked the equality lever in the divorce referendum really explained why RTE should be punished. I would like to see this matter reopened and rejudged and a definition of executive power given. Members of local authorities, of whom I was one, and Senators have their powers laid down. In local authorities there are executive and reserved functions. Similarly, the Dáil is separate from the Executive. I would like to see a judgment on this. As members of a Government party, Fine Gael members saw who would be left to carry the can in a financial fiasco. Those who advocated a "No" vote also advised people not to pay the property tax. They will pay the tax because they do not want to be brought to court or sent to jail, but it is all right to advocate that their constituents should refuse to pay and risk being sent to jail. That is irresponsible. If they are not prepared to bring forward an alternative proposal to ensure funds for ATM machines, social welfare payments and everything else, who will carry the can? Who will be responsible at the end of the day? To whom do we listen and who is telling the responsible story? We cannot blame RTE or the media in this case, as they were bound by a judgment. It is up to us, as politicians, to question it. That is all I am saying. I congratulate the "Yes" and the "No" sides on the work they did. Everyone worked under the banner he or she was given. It could happen that everyone would lose the plot and one person might be right. For such an eventuality, we must define "executive power" and what is and is not legal.

Photo of Paddy BurkePaddy Burke (Fine Gael)
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The House will adjourn until 4.45 p.m. on Tuesday, 19 June, in accordance with the order of the House of today.