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Taoiseach's statement on European Council to Dáil Éireann

Taoiseach Enda Kenny today made a statement to the Dáil on last week's European Council. In his statement, the Taoisaech spoke of the results of the Council meeting:

Important steps were taken both in relation to budgetary discipline and firewalls – issues of great importance to this country – and progress was made towards taking Europe beyond the current crisis.

The Taoiseach told to Dáil he set out Ireland's priorities in a meeting with European Council President Herman Von Rompuy in advance of the Council meeting:

In advance of the meeting, I spoke with, and wrote to President Van Rompuy setting out Ireland’s key priorities:

Firstly, decisions to stabilize the Eurozone through stronger firewalls and new rules.

Secondly, the need for the removal of the PSI provision from the ESM Treaty, and

Thirdly, to signal the Governments intention to pursue the application to Ireland of the new financial instruments that did not exist at the time of the initial recapitalisation of the Irish banks.

I am satisfied that progress was made on each of these issues.

The Taoiseach outlined the "New Fiscal Compact" :

On strengthened economic policy coordination we agreed what has been called “a new fiscal compact”. Essentially this is a set of reinforced budgetary rules for countries within the euro area.

Specifically, we agreed that Government budgets should be balanced or in surplus. Looking at where Europe is now, this is an entirely sensible proposition.

We agreed that this rule shall be deemed to have been respected if, as a rule, the annual structural deficit does not exceed 0.5% of GDP.

The Taoiseach spoke of co-ordination of Member States' fiscal plans:

The new arrangements will mean more co-ordination of the fiscal plans of member states.

This is not something that should be a concern to Ireland. We are already in the process of preparing a Fiscal Responsibility Law that will ensure that the mistakes of the past – that have led us to where we are – cannot be and will not be repeated in the future.

Ensuring that other Member States toe a similarly disciplined line is something we should welcome.

It is, of course, necessary to ensure that when we advance we do so on the basis of sound reasoning and careful analysis, and with proper regard to the requirement for democratic legitimacy and political accountability.

The Taoiseach also addressed the issue of the UK's participation in the new fiscal compact:

The obvious exception is the United Kingdom which felt that it was not in a position to agree.

This is a disappointing development, though it is clearly for Prime Minister Cameron to decide how best to advance and defend the UK’s interests. In approaching the meeting, I had very much hoped that we could find a way forward at 27, not least as a strong signal of complete unity and common purpose at European level. And I am also conscious that the UK is our closest neighbour and very often our staunchest ally at the European table. It also brings a unique and important perspective to bear that will now be missing from these important debates.

We will, of course, continue to work as closely with the UK as we have ever done – our relationship is deep and wide, based on important common interests across a range of EU policy matters.

In conclusion, the Taoiseach assured the Dáil that national issues would also be considered:

Last week’s meeting was very focussed on the big picture – how to stabilise the euro and how to deal with the Eurozone crisis. It was not an occasion at which national issues were on the table for decision.

However, I set out our case strongly gave colleagues a clear understanding of the scale of our predicament and challenge. I told them that, together with the Minister for Finance, I will be pursuing the matter further in the period ahead.

I am confident that, in due course, we will be able to make positive progress in a way that makes a real difference for Ireland. I intend to leave no stone unturned in that regard.

Read the Taoiseach's full statement here.