Martin urges Government to reject Franco-German calls
As Taoiseach Enda Kenny continues negotiations at the crucial EU summit in Brussels today, Mr Martin said the Franco-German plan was flawed.
“Too high a price is being asked for action which will not solve Europe’s problems,” he said.
Under the plan, eurozone members would be obliged to have greater fiscal discipline, with automatic sanctions for those which allow their deficits to grow too large.
It also calls for the “convergence and harmonisation” of corporate tax arrangements, as well as the creation of a financial transaction tax.
The French and Germans have made it clear they would like the new arrangements to be implemented through treaty change, which would require the agreement of all 27 EU states, but that they are ready to press ahead with an agreement between the 17 which use the single currency if that is not possible.
But Mr Martin urged the Taoiseach to reject the Franco-German plan.
“The list of measures which President Sarkozy and Chancellor Merkel seek are flawed and would cause great damage to Ireland and Europe if implemented,” he said.
“At the core of their proposals is a dramatic increase in central control of national budget policies, including a common corporation tax base which would immediately cost Ireland billions.
“On the other hand, the package completely ignores the need for a deep reform of the European Central Bank and policies which have driven countries into bailouts rather than stopping them from being necessary.”
Mr Martin said the proposed financial services tax “could decimate” the Irish Financial Services Centre, particularly if Britain secures opt-outs from any such tax.
Mr Martin said the treaty proposed would “entrench flaws” in the euro.
“It removes any ability to implement policies to tackle downturns and it says that Europe will still have no lender of last resort to protect its sovereign bond market,” he said.
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