Fiscal treaty a necessary instrument in EU 'toolbox'

THERE PROBABLY would have been no sovereign debt crisis if all EU countries consolidated their finances during the “good times”, an Oireachtas referendum committee was told yesterday.

Danish ambassador Niels Pultz said his government believed the fiscal treaty was a necessary instrument in the EU’s “common toolbox” and “should be seen as an important part of the EU’s wider efforts to combat the debt crisis”.

Addressing the first meeting of the Sub-Committee on the Referendum on the Fiscal Stability Treaty, he said: “If all European countries had conducted sound and sustainable economic and fiscal policies in accordance with the fiscal compact, Europe would most likely not have experienced the sovereign debt crisis.”

Mr Pultz was among four EU ambassadors addressing the sub-committee chaired by Meath East Labour TD Dominic Hannigan.

Czech Republic ambassador Tomas Kafka said it was the perception in his country that the EU had moved from being in a “win-win situation to a clash of political ideas”. In the eight years since they joined the EU they had the reputation as “a bit of a troublemaker”.

The Czech Republic was outside the euro zone and had a major constitutional problem with the Lisbon Treaty. It had still not signed up for the treaty. “However, that is something that may happen in the future, especially as the inclusive character of the treaty itself literally invites reconsideration.”

Asked by Fianna Fáil Clare TD Timmy Dooley about the impact for Ireland of voting No, Mr Kafka said it was “not for me to say how Ireland would eventually cope being outside the treaty, but I’m pretty sure Irish people are now very much aware of the sea change of the world we live in”.

“I am pretty confident the people will see it as a choice; what are the costs of any separate run and costs for any enhanced integration with the euro zone.”

He said “even though it is nicknamed as a treaty on the fiscal compact I would say it’s the treaty on the restoration of mutual trust and confidence within the EU”.

Greek ambassador Constantina Zagorianou-Prifti said “the treaty was relatively easy for us” and “almost natural for us to accept” because “we knew the need for a new tool” for the EU.

She said “the sacrifices of the Greek people are producing results”. The primary deficit had been significantly reduced within just two years, and it had significantly regained competitiveness.

Taoiseach Enda Kenny, Tánaiste Eamon Gilmore and other party leaders are also to appear before the subcommittee.

In addition, Fianna Fáil leader Micheál Martin, Sinn Féin’s Gerry Adams and chief whip of the Technical Group Catherine Murphy TD will address an all-day committee meeting on Tuesday, April 17th.

Each of them will be given an hour to present their views and answer questions on their stance on the May 31st referendum. Senator Katherine Zappone will represent Independent members of the Seanad.

The subcommittee is to issue a report of its findings by May 5th.