Táim an-bhuíoch den Chathaoirleach agus den choiste onórach seo as an chuireadh a thug siad dom teacht anseo tráthnóna. I appreciate the privilege of having an opportunity to make some points to the committee and I hope they help the committee in its deliberations. Before making my basic statement I wish to make some short remarks by way of background. As some committee members may know, I have been a long-term critic of European integration on democratic and internationalist grounds. That has been the case throughout most of my adult life. One reason is that a long time ago I used to read the speeches of the late Jean Monnet and I read his memoirs as well. He was one of the founding fathers of the European Community or Union. It was clear from this material that he saw the European Economic Community as developing towards a type of federal political union in Europe. I thought that to be fundamentally undemocratic.
The Schuman Declaration is commemorated on 9 May every year by the European Union. The declaration was presented at the inauguration of the European Coal and Steel Community, the first super-national community, and includes the line that the declaration was the first step in the federation of Europe.
Of course, a federation is a state and it is quite clear that the aims of those who have been pushing the integration project include essentially trying to turn the various nation states of western and central Europe into elements in a super-national federation. The Treaty of Lisbon gave us a super-national constitution. It is a normal federal-type constitution with sovereignty divided between federal level in Brussels and national level in member states. It gave us two citizenships, our Irish citizenship and our European citizenship, in a real sense. We have a constitutional federation or a federal-type constitution but we do not have a fiscal union with common tax on services, which would shift resources from the richer to the poorer areas - that is what happens within each national state. That is the fundamental problem of the integration process.
Often one discovers the importance of health when one gets sick. Similarly, one understands the importance of democracy often only when one has lost it. There is no doubt, in my submission, that the European Union has greatly deprived national member states of national democracy without establishing democracy at the super-national level. That is impossible in principal because there is no European demos or people whose support or votes would give legitimacy and valid authority to the super-national project. That is the fundamental problem and that is why, I suggest, in the context of the diminution of democracy at national level, there is a revolt against integration throughout western Europe at present.
My basic submission is that the Irish State should take advantage of the citizens of the United Kingdom voting to leave the European Union to do likewise because this is an opportunity for us also to get back our democracy, sovereignty, law-making power, etc. I have read most of the submissions made to this honourable committee on the Internet. It seems most of the problems related to Brexit that the select committee has been considering in previous hearings would be avoided if the State left the European Union at or around the same time as the United Kingdom, for five main reasons, which I shall set out.
First, leaving the European Union would save the State money as we are now net contributors to the EU budget rather than net recipients from it. Most people are not aware of this fact but it is quite an important one. For so long, the European Union was seen as a kind of cash cow for people in Ireland but it is no longer that. We must now be a net contributor if we stay in the Union. The United Kingdom has been contributing for quite some time. The second basic reason is that leaving the European Union would give us back control of our valuable sea fisheries, the annual value of catches by foreign boats in these being a multiple, by several times, of the money we have got from the European Union over the years. This would be extremely valuable. We, of course, do not have normal national state control over our fisheries.
The third reason is that it would give us back control of our law-making, free us from the rulings and sanctions of the European Court of Justice and thereby restore our State sovereignty and national democracy.
The fourth basic reason we should leave the European Union at or around the same time as the United Kingdom is that it would give us back a national currency, which is one of the two pillars of any independent state, and with it the capacity to run an independent exchange rate policy that is important, if not vital, for our economic competitiveness, especially in the context of Brexit. Another reason is that we do most of our trade outside the eurozone and the EU 26, namely, the EU members minus the British. Approximately three-fifths of our exports go outside the EU 26 and two-thirds of our imports come from outside the EU 26. The most important single country market for our foreign firms is the United States of America. The most important single country market for our domestic firms is the United Kingdom. That is a very important point. In Annex 1 of my document, there are trade figures for exports and imports as regards goods and services for the year 2015. These are the most recent figures available from the Central Statistics Office. Fifth, the most important reason of all we should consider leaving the European Union along with the United Kingdom is that it is the only way to save the Irish Government and the parties that support such a policy from the guilt and responsibility, before future generations, in respect of implementing in our time a new partition of Ireland, or adding significantly to the existing partition.
These reasons are expanded on in the documents accompanying my submission. Annex 1 is "Taking Back Control: the logic of accompanying the United Kingdom out of the European Union", and Annex 2, which I believe has been circulated, is "Why Brexit should be accompanied by Irexit (Ireland Exit)". The latter is the report of a private study group of Irish economists and lawyers that I was responsible for convening during the past year. I drafted the report.
It is hard to point to any significant advantage for the Republic remaining in the European Union when the United Kingdom leaves. Owing to this, I believe it is probable that Brexit will ultimately be accompanied by Irexit, as the adverse consequences of our seeking to stay in the European Union become evident to the Irish public and to major Irish interest groups over the coming two years. Perhaps that will happen quite late in the day. Presumably our Government and society will need to see the lineaments and key elements of the British deal with the European Union before deciding on their own final policy. Even if we do remain members of the European Union without the United Kingdom for a period after Brexit, however, it seems it is likely to be an experience so painful that it will induce us to leave, except that to wait until then would mean that we would be leaving from a position of considerable weakness. If we try to leave now, along with the United Kingdom, we can, of course, co-ordinate our movements with it. That is why we should start preparing for leaving now, and especially prepare for leaving the eurozone, which is the real, big problem associated with leaving the European Union. It is the negative reason for considering leaving because the pain of getting out would possibly be quite significant, even though this would also be the case with the pain of staying in. The latter would be even greater. Consequently, the course of action of the Government that is most in the Irish people's interest is to use the east-west and North-South strands of the Good Friday Agreement to concert a joint approach with the UK Government aimed at both states leaving the European Union simultaneously, or around the same time, and to work towards a UK-Ireland agreement and an Ireland-EU agreement embodying that policy. The contrary course, which is for the Irish Government to seek to stay in the European Union and eurozone as part of so-called Team EU 26, would be one of folly and, if persisted in, will undoubtedly come to be seen as such in time.
I wish to add some points on the North-South aspects of the matter, on which I want to concentrate in my statements. The United Kingdom leaving the European Union and the Republic remaining in it would greatly strengthen partition and make eventual Irish reunification more difficult, for three obvious reasons. For us to support such a course would be to contribute to a second partition of the country, which is a very grave responsibility for legislators who are considering it, yet it is the obvious corollary of our staying in the European Union if Britain and Northern Ireland leave it. The first and most obvious reason is that our staying in the European Union and Britain and Northern Ireland leaving it would add several new dimensions to the existing Border: food and EU veterinary checks on milk and animals moved from the North to the South, for example; customs posts; possible passport controls; and growing divergence between EU-harmonised law and justice provisions in the South and British ones in the North. The second reason, to which I have not seen any allusion in public or in any document I have read, and which might be of particular interest to this committee, is that the British Government's statement that it has “no strategic interest” in staying in Ireland if the majority in the North should wish otherwise underpins the 1993 Downing Street Declaration and the 1998 Good Friday Agreement. If, however, the South remains in the European Union when the United Kingdom leaves it, any future Irish reunification would mean that the whole of Ireland would become part of an EU security or military bloc under German hegemony. As one knows, the EU authorities have made clear they are anxious to push towards closer security co-operation in the context of a European Union minus the United Kingdom. That can never be in Britain's, or even England's, security interests. It would give London a new strategic security interest for holding on to the North and give future UK Governments good reason from their point of view to discourage, rather than welcome, future moves towards a united Ireland. That is an important consideration for those of us and all those Irish political parties that would, in principle, like to bring about Irish reunification. Our staying in the Union without the United Kingdom would add a new dimension to partition.
The third reason is that our State staying in the European Union when the United Kingdom leaves would give Northern unionists a whole series of new and objectively valid reasons for opposing a united Ireland if we want to bring that about some time, however remote and distant. It is obviously a consideration that should influence us. For Northern unionists, reunification at some future date would mean that they would have to join the European Union, with its 123,000 or so supranational rules, legal acts and international agreements, which is hardly real freedom. They would have to adopt the dysfunctional euro currency instead of the pound sterling, which they have at present. They would have to take on the burden of helping to pay for the private bank debt that the troika imposed on the Republic when it decided in 2010 that no Irish bank should be let go bust. They would have to agree to be bound by all the new EU laws and regulations that will be passed between now and whenever partition might end at some time in the future. It is hard to envisage significant unionist consent to Irish reunification occurring in these circumstances. As the Good Friday Agreement recognises, partition can never be ended, or the country reunified, without the consent of at least a significant number of the present unionist population. We need, of course, a majority in the North for reunification.
The Irish Government and all the Irish political parties ought therefore to support and work towards a policy agreement with the UK Government and the European Union that would bring about Irexit alongside Brexit on the following desirable lines. I shall suggest some of the key elements that sensible Irish Government policy should seek to implement.
First, the relevant UK governmental powers that will be repatriated to London from Brussels, including control of Northern Ireland sea fisheries and other underwater resources, should be devolved to the Northern Ireland Executive in Belfast. Second, a rate of corporation profits tax comparable to that in the South might be introduced for the North to encourage foreign investment on an all-Ireland basis. Third, it is desirable for generous direct payments to be provided by the UK Exchequer for Northern Ireland farmers to compensate them for the loss of current Common Agricultural Policy payments and the impact of cheap food imports to the British market following Brexit. As Senators are aware, the British Government has agreed in principle to continue these payments for a certain period. The length of time in question is of considerable interest. I presume Northern unionists would support these measures which could well form part of agreements between Ireland and the United Kingdom and Ireland and the European Union.
The United Kingdom should co-operate with the Irish Government to secure a mutually advantageous post-Brexit agreement between the United Kingdom, Ireland and the European Union that would ensure free trade, including in agricultural produce, between these three parties. It is in the interests of all three parties that free trade should continue as it is. Sensible negotiation should bring this about. It is possible that in these circumstances the United Kingdom would maintain for a period of time direct payments for the Republic’s farmers comparable to those paid in Northern Ireland as recompense for the removal of EU Common Agricultural Policy payments. This might be done in the interests of Anglo-Irish and North-South co-operation. Obviously, such a circumstance would be desirable from the perspective of the Republic. If the British Government was willing to pay some money to facilitate a joint departure by the two states from the European Union, this might, in part, take the form of support payments for farmers here, along the lines of what is planned for farmers in the North of Ireland. Of course, this would be done through the Irish Government.
If the Irish Government were to seek to leave the European Union, it would be quite important for this state to get back its national currency. One of the main problems in this situation is the utterly foolish decision to join the eurozone in the first place. We do just one third of our trade in the eurozone. We do two thirds outside it. By no means has this experience been happy for us, any more than it has been for many other countries in the European Union, particularly in southern Europe. If we were to seek to leave the European Union, we would have to align our policy with that of the United Kingdom and co-operate with the British Government in joint or parallel negotiations with the European Union. As a key element of this, there would be a requirement for the UK Government to co-operate with the Irish Government, the European Central Bank and the governments of the 19 eurozone countries, particularly Germany, in facilitating Ireland's departure from the eurozone and the re-establishment of an Irish currency. This should happen in a constructive manner to disturb the eurozone as a whole as little as possible.
This country's highly competitive exchange rate which was made possible by an independent Irish currency gave the Republic an annual average economic growth rate of 8% during the Celtic tiger years of 1993 to 2000. That was the only period since its foundation in 1922 in which the State followed an effectively floating exchange rate policy. The highly competitive exchange rate that was maintained for a period of seven or eight years contributed substantially to the extraordinarily high economic growth rate in those years. Dublin is stuck with an overvalued euro currency which is affecting exports and encouraging competing imports. The Republic needs to get back its own currency to uphold, expand or restore its economic competitiveness and prevent Southern customers from streaming into the North to do their shopping in the face of a regularly falling British pound which is likely to continue to fall during the Brexit negotiations and possibly for a considerable period after an EU-UK deal is concluded. A restored Irish pound would need to be devalued to restore or maintain the State's competitiveness in the new situation and maximise its rate of economic growth. The support of the Bank of England would be helpful to prevent any such devaluation from going too far in the initial days and weeks. That is why the provision of such support should be an important element of any Ireland-UK agreement.
Any understanding reached between Ireland and the United Kingdom on foot of joint or parallel negotiations should seek to ensure the UK Government would co-operate closely with the Irish Government in negotiating joint trade agreements and foreign investment deals with third countries after Brexit and Irexit happened. The aim of such agreements and deals should be to benefit both parts of the island of Ireland in co-operation with the Northern Executive in Belfast. I submit that these provisions, or variants of them, would bring major benefits to both parts of Ireland and the United Kingdom. They would avoid adding new dimensions to the existing North-South Border. I do not think the Irish people in the future would welcome or praise the politicians responsible for changing the current Border arrangements.
I invite the Chairman and members of the committee to consider these points and raise them with their Oireachtas colleagues. I suggest they be impressed on the Government as being in the best interests of the Irish people in both parts of the country as we face the challenges presented by Brexit. I thank the committee for allowing me to make my statement.
