Government must seize opportunity to deliver European stimulus programme – FF

Fianna Fáil Spokesperson on Jobs, Enterprise and Innovation Dara Calleary has said that the Government must seize the opportunity presented by the appointment of a new European Commission to deliver a real stimulus plan to revive the European economy.

Deputy Calleary was reacting to comments by the incoming President of the European Commission Jean-Claude Juncker, who has set out his vision to “reindustrialise” Europe and stressed that unemployment in the region remained the biggest challenge.  He also outlined his plans for a €300bn stimulus programme over the next three years funded through existing budgetary funds, the European Investment Bank and the private sector.

Deputy Calleary commented: “We have had false dawns in Europe before when it looked like real action was going to be taken to stimulate demand.  Programmes such as the Compact for Growth published in June 2012 looked initially like they were going to provide a basis of kick starting the European economy only to end up being little more than repackaging of existing plans.  If Juncker is serious about a real fiscal stimulus the Irish Government should seize the opportunity and support him fully.  As an exporting country we would benefit disproportionately from a programme of investment in Europe.”

“Europe has been stuck in a ‘one size fits all’ austerity mode for the last six years.  This policy has outlived its usefulness.  Each country will have its own investment priorities but there is a clear need for co-ordination across member states to drive new policy that will benefit us all.  As well as this there is enough room for countries such as Finland, Austria, the Netherlands and Germany to increase their own domestic spending without endangering their own budget targets,” added Deputy Calleary.

“We know that changing a failing policy can bring significant benefits.  When the ECB belatedly took action to change monetary policy and promised whatever action was necessary to save the euro it had an immediate benefit and resulted in a massive fall in the borrowing costs for European nations.  The tragedy of this policy change was that the ECB had for so long stuck rigidly to a failing policy.  The European Commission and the Council of Ministers need to learn the same lesson in respect of fiscal policy.  The words spoken by Jean-Claude Juncker were certainly encouraging.  They now need to be turned into concrete policy actions.  Our Government should lend their full weight to these efforts at this week’s European Council summit and with the formation of the new Commission members.”