Enda Kenny has said the Government did not want to have to tackle the State’s debts in an “accelerated fashion” if people voted no to the EU fiscal treaty.
His comments came after Michael Noonan, the finance minister, warned earlier this week that the budget would be “dramatically more difficult” if the treaty is rejected on May 31.
The Taoiseach said a no vote could have knock-on effects on investor confidence in Ireland and therefor hit our recovery plan and future spending.
“If companies look at Ireland and they decide that they want to continue the strong line of investment, that means a yes vote. That’s very important.
“The Government has committed to a programme which is set out for the five years and we’ve set out our views on taxation, and taxation and work. We don’t want anything to damage the investor line of confidence in our country here.
“The minister for finance has set that out very clearly indeed. He doesn’t want a situation whereby if you didn’t have access to the ESM and you weren’t able to get back into the markets, that you’d have to deal with your deficit in an accelerated fashion.”
The European Stability Mechanism (ESM), which facilitates bailout funds, will come into effect in July. But member states who refuse to sign up to treaty will be blocked from using it.
The Government say that Ireland is not expected to need the ESM but that it is a good ‘insurance policy’ for the country and will help investor confidence.
Mr Kenny added: “We hope to be out of our programme as quickly as possible. We hope never to have to use the ESM mechanism but it’s there as a back stop, as insurance, as a confidence measure for continued investment here.”
The Taoiseach also warned the no campaign against giving the public “misleading” messages on the treaty.
“I hope that those proposing a no vote here are factual and truthful about the issues involved in this treaty. I don’t want to see anymore leaflets going around with a deliberate distortion of the treaty which are designed to mislead people about what this treaty is about.”
His comments came after Sinn Féin, who want a no vote, last week released leaflets with selected quotes from several economists but did not say the commentators supported a yes vote.
Mr Kenny yesterday launched changes to Fine Gael’s Facebook page, which will feature ministers in videos replying to online queries from the public about the treaty.
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