High Level Conference on Investing in Europe's regions and cities:
Maximising the impact of regional and local public expenditure
and the EU budget 2014-2020
Brussels, 13 May 2013
Ladies and gentlemen
I would like to thank the Committee of the Regions and the European Investment Bank for organising this important conference and for giving me the opportunity to speak to you today. I am pleased to take part in what I am sure will be an interesting debate and exchange of views.
The number of regions and the diverse range of organisations represented here today serve to underscore the importance of the debate on how the financial and economic crisis has impacted on investment in Europe’s regions and cities. We all need to identify what innovative solutions there are for maximising the impact of investment in these areas.
2013 marks the fortieth anniversary of Ireland’s accession to the European Union. Membership of the Union has played a considerable role in Ireland’s economic, social and political development in the intervening four decades. Over recent years the European Union has been a key partner in Ireland’s programme of recovery.
During those recent years we have faced a difficult challenge in repairing the Irish economy and public finances. But we have faced up to that challenge and we are confident that we can lead Ireland back to normal market funding and to sustainable growth in living standards and employment.
By taking tough decisions, we have implemented a consolidation strategy that is correcting our deficit while allowing economic growth to be maintained in Ireland. The progress we have made has rebuilt the trust of the markets and our European partners in the Irish Government’s ability to keep our house in order.
With 85% of the necessary consolidation already implemented, we are in sight of the completion of the programme of financial assistance. It is vitally important at this stage, however, that reform fatigue is not allowed to set in. We have to give our citizens hope that the tough steps they have taken are on the right path to recovery.
Having returned to growth in 2011, Ireland achieved a second successive year of growth in 2012.
In recent months the labour market has also provided some cause for optimism. Data from a recent labour market survey show that (seasonally adjusted) employment increased in each of the last two quarters of 2012.
As is typical in small open economies such as Ireland’s, the traded sector is leading the recovery with the services sector playing an increasingly significant role in export growth, owing much to the significant price and cost adjustments that have taken place in recent years.
While our central objective is to control public expenditure and bring our budget back on track, we are also committed to reforming how Government works so that we can maximise the return on every tax euro.
We also need to drive down Public Service costs through better practices and more streamlined delivery. It was precisely for that reason that the Irish Government established a Department combining responsibility for Public Expenditure and Reform, which I am proud to head.
2013 also marks the seventh time Ireland has assumed the Presidency of the Council of Ministers. This is an opportunity that Ireland has always valued. It gives us an opportunity to demonstrate we are a constructive and committed Member State that belongs at the very heart of the European decision-making process. Ireland is a country in recovery helping to drive recovery in Europe.
I would like to acknowledge the role the Committee of the Regions has played and is continuing to play in that recovery, and I welcome the important and continuing involvement of the Committee in a range of dossiers during the Irish Presidency. Ireland is actively represented on the Committee by members, many of whom I know well. This ensures that regional and other sub-national interests in Ireland are represented at EU level.
At the beginning of March President Valcárcel, was in Dublin for a major conference organised by the Committee on an agenda for new skills and jobs. While in Dublin, President Valcárcel also had an opportunity to meet the Taoiseach, Enda Kenny.
The Dublin conference highlighted the fact that Ireland is holding the Presidency of the Council at a time of great challenge not just for Ireland but also the whole European Union. Citizens across Europe have faced difficult years and now justifiably expect leadership from their Governments to deliver economic growth and stability. This is why the core objectives of Ireland’s Presidency programme are promoting stability, jobs and growth in Europe.
In the years ahead, investment in Europe's regions and cities will be crucial in ensuring the theme of stability, jobs and growth is sustained and developed.
During our Presidency we are pleased we have been able to work with the Committee on its Opinion on the synergies between private investment and public funding at local and regional levels. The Opinion presented by Rhodri Glyn Thomas is an important contribution to the debate around the use of Public Private Partnerships and Financial Instruments and I would like to thank him for his work on it.
The Opinion highlights the challenges of stimulating economic recovery across the European Union and the key role of the EU in helping to restore confidence in the economy, as well as the contribution that Public Private Partnerships and Financial Instruments can make. It also acknowledges the important role of the European Investment Bank.
I too recognise the crucial role of the EIB as the EU's long-term financing institution, and its expertise and knowledge in the development and implementation of a range of financial instruments, in co-operation with the European Commission.
Ireland is very open to the possibilities offered by such instruments but recognises many of the obstacles that can exist to their effective use, including the availability of finance and the complexity of the instruments.
We are keen to explore the option of using financial instruments in Cohesion Policy for the 2014-2020 programming period and we are actively investigating whether there is both a scope and a need for utilising such instruments under the new Regional Operational Programmes.
To that end Ireland invited the EIB last year to undertake a JESSICA feasibility study. This study, which is being conducted by PWC and ARUP, is almost completed and the findings will feed into the preparations for the Regional Operation Programmes for 2014-2020.
In the next programming period it is essential that the European Structural& Investment Funds are used in conjunction with EIB funds and financing sourced from Government and the private sector to ensure an optimum leveraging for EU and EIB funds while securing economic growth and related employment creation.
Cohesion spending lies at the very heart of the growth agenda and will be one of the primary instruments available to the Union to drive investment and to promote growth and jobs in the years ahead.
Forty years’ experience has taught us that Cohesion policy has been one of the success stories of Europe. It lies at the very heart of European integration and solidarity and proves that these words have real meaning for every part of the Union.
It has played a major role in reducing social and economic disparities and increasing cohesion in a Union of 500 million people in 27 Member States across 271 regions. The financial investments from the EU Budget are important levers available to Member States to bring about change and encourage development in the Regions.
The Irish experience of Cohesion funding has been very positive, with Cohesion policy playing an important role in the development of Ireland’s economy.
We are now approaching what I hope will be the final stage in the negotiation of the Cohesion legislative package for 2014-2020. In January I set out our objective of reaching agreement with the Parliament by the end of the Presidency. That remains the case. I have, of course, always been conscious that reaching political agreement in that timeframe would be a challenge. Nevertheless, I am committed to working collaboratively with the Parliament on what I believe is a shared objective.
The Irish Presidency is also committed to working with the Parliament to reach agreement on the MFF under our Presidency and I am pleased that the first formal trilogues get underway this afternoon.
Over the last four and a half months we have made progress many files, including the Youth Guarantee, economic governance measures, Banking Union legislation, the single market and external trade.
With 7 weeks remaining we are intensifying our efforts to deliver on our core objectives. We are working closely and co-operatively with all our partners and the EU institutions.
The agenda for today’s conference promises an interesting and informative day and I am looking forward to hearing the views of other
speakers and participants. Once again I would like to thank the organisers for their invitation to speak here this morning and I look forward to continuing to work with the Committee and our other EU partners on the shared objectives of stability, jobs and growth.