Noonan welcomes leaders’ plan to tackle euro crisis

FINANCE Minister Michael Noonan welcomed plans for a collective economic government, announced by the French and German leaders yesterday, which he said reaffirms their “absolute determination” to defend the euro.

The formation of a common eurozone government has moved a step closer after the leaders of the euro area’s two biggest economies called for “true economic governance”.

Following a meeting in Paris yesterday — which was designed to shore up market confidence in the eurozone — French president Nicolas Sarkozy and German chancellor Angela Merkel said much closer economic and fiscal policy was now needed among member states.

They called for bi-annual meetings of the 17 heads of the eurozone governments to be arranged under the chairmanship of Herman van Rompuy, the current president of the European Council.

The two leaders also announced plans to seek commitments from eurozone countries with regard to balanced finances, and said these assurances should be written into the constitutional law of each member state by the summer of 2012.

They also advocated a tax on financial transactions to raise more revenues.

However, responding to events in Paris, Mr Noonan warned that introducing debt limits would require a constitutional amendment, which was a matter for the Irish government to consider.

He said he will be directly feeding Ireland’s views into the discussions on the proposals at upcoming European meetings with other finance ministers.