Taoiseach awaiting legal advice on referendum possibility

The Government is getting legal advice on whether Ireland needs a referendum on a new European treaty as part of a plan aimed at solving the debt crisis and saving the euro.

Taoiseach Enda Kenny said Attorney General Marie Whelan will have to forensically examine a fiscal union deal struck at a European summit.

At least 23 of the 27 European states, with the exception of Britain, are expected to form a new Fiscal Stability Union, which would mean stricter budget and debt rules and penalties for those who breach them.

“The first thing is that once the text has been approved and agreed every country has to do its own thing,” said Mr Kenny in Brussels.

“In our case the Attorney General will have to analyse that, forensically examine it and give official and formal information and advice to the Government as to whether a referendum is required or not.”

“Obviously I wouldn’t speculate on that because I’m not confident to do so,” he added.

The summit was initially expected to result in an EU treaty change, but British Prime Minister David Cameron refused to support it because it would not guarantee London’s financial services the protection he demanded.

However Mr Kenny was positive about the outcome of the meeting of Europe’s top leaders, saying firewalls had been established to help prevent contagion of the crisis.

“Ireland’s economic security has been defended and protected,” said Mr Kenny.

“A great deal of useful work was done in respect of putting firewalls to prevent contagion and the substance of this has now been agreed and requires to be checked and analysed by each individual country.

“Specifically in Ireland’s case, I raised the exceptional difficulty that Ireland’s gone through in having to borrow very extensively prior to the bailout for bank recapitalisation and the challenges that faces for us and I placed that firmly on the table.”

Earlier, Ireland’s Minister for European Affairs Lucinda Creighton insisted that increasing the Irish corporation tax was not addressed during the summit despite French President Nicolas Sarkozy’s previous calls to end unfair taxes across the eurozone.

She said hiking the controversially low rate of 12.5% was never on the table to begin with.

“”There never was any intention of having a discussion around corporation tax,“ said Ms Creighton.

“It wasn’t an issue that was on the agenda at all.”

She said discussions focused on safeguarding countries from contagion and strengthening the euro.

“(They were) very much focused on strengthening mechanisms of economic governance and engagement between member states in relation to the currency,” Ms Creighton said.

“And focusing on the so-called stabilisation – this firewall which we’ve been indicating for quite some time – there were some very significant steps there and we’re very hopeful they will make an important impact in terms of ensuring there won’t be further contagion within the eurozone from Greece.”