‘FF would support yes vote on fiscal compact’

Fianna Fáil would support a yes vote if a referendum was held on the fiscal compact, Micheál Martin has said.

The party leader reiterated his belief yesterday the public should be consulted on the compact. He made clear he would be calling for a Yes vote in any such referendum even if he has doubts about the compact’s ability to end the European debt crisis.

The compact is the new set of budget rules agreed between 25 of the 27 EU member states.

However, Mr Martin said the compact was insufficient to solve the debt crisis, and instead called for a “significant expansion of key federal powers” — essentially giving the EU stronger tools to tackle the problems.

Nonetheless, even if those tools failed to be put in place, Mr Martin indicated Fianna Fáil would support the compact.

“More information is needed on the likely impact of the treaty and I have sought clarification from the Taoiseach on a range of points,” he said in a speech at the Institute of International and European Affairs in Dublin.

“In principle we are positive to the treaty and will support it subject to receiving a proper response to our reasonable queries about its impact.

“Unlike some in the Cabinet, we have never voted against a European treaty and I don’t bel-ieve we will start with this one.”

Mr Martin’s comments will ease suspicions in Government circles over Fianna Fáil’s stance on the compact.

Because the party had consistently called for a referendum, some thought Fianna Fáil was gearing up to vote No in an attempt to damage the Coalition.

Mr Martin said yesterday one would “not find a single Euro-sceptic comment” in any of the statements he had made on EU issues since becoming party leader. “What you will find, from an early point and with increased urgency, is a sense that the European ideal is being failed by its leaders and that citizens are being ignored.

The compact, he said, was insufficient and more radical action was required. He called for:

* The “limited mandate” of the ECB to be overhauled so that it could work as a true lender of last resort to member states;

* A pan-eurozone bank resolution regime to be established so the ECB would no longer “push governments to take unreasonable debts from failing banks in order to prevent contagion”;

* And a “more ambitious” fiscal union, involving transfers of resources between states — essentially meaning wealthier states would provide financial assistance to poorer ones.

As an example of federal powers, Mr Martin pointed to the US, where central government had no control over state budgets but was able to raise its own funding — which it then uses to help all the states.

The Government is awaiting legal advice on whether a referendum is needed on the compact.