Response from Minister For Finance, Brian Lenihan T.D. to Statement by Fine Gael Finance Spokesman

It is reprehensible for Fine Gael to seek to whip up entirely unfounded anti-European sentiment at a time of such financial difficulty for the Union.

As Deputy Bruton knows well, the Commission discussion document issued today does not even mention tax harmonisation. He knows there is nothing in the Lisbon Treaty that diminishes our sovereignty in fiscal matters. He knows the government secured a protocol confirming this position in advance of the second Lisbon referendum.

To suggest, as he does in his statement, that our corporation tax rate is threatened by proposals announced today is highly irresponsible and certainly not in the interests of this economy which depends so much on foreign direct investment. As I said in my Budget speech: “The 12.5% Corporation Tax rate will not change. It is here to stay.”

Greater coordination of economic policies is comprehended in Art 136 of the Lisbon Treaty. All sixteen Eurozone members are deeply intertwined through the common currency. As we have seen over the past few weeks, a speculative attack on one member state affects us all. For that reason, we have a shared interest in enhanced economic coordination throughout the zone. Today’s proposals on this matter will be referred to the Task Force set up by EU President Van Rompuy, of which I am a member. Any decisions arising out of the Commission’s document will reflect the views of member states.

It is important to point out that greater consultation and coordination on budgetary matters will apply to all member states, not just Ireland. Indeed, the Commission along with the ECB has recognised that Ireland has taken the correct budgetary decisions during this crisis. Commissioner Olli Rehn recently said: “Ireland’s bold and credible measures are paying off. I would agree with Brian Lenihan that the worst is over and the Irish economy is now recovering.”

It is disturbing that Fine Gael, in pursuit of its own narrow political purposes, would seek deliberately to pander to a jingoistic, anti-European line of argument worthy of the far reaches of Euroscepticism. As Richard Bruton well knows, the suggestion that democratic control of any member-state’s finances is being ceded to the European Commission is just plain wrong. Indeed the Commission’s proposals explicitly envisage the involvement of national parliaments in budgetary preparations.

It is a great disappointment to see the main opposition party depart from its traditionally proud pro-European stance. Are there no holds that are barred in their relentless pursuit of power?