25 EU states agree treaty to toughen budget rules - Irish Times

The Irish Times - Tuesday, January 31, 2012

ARTHUR BEESLEY, DEREK SCALLY and HARRY McGEE in Brussels

THE GOVERNMENT will ask Attorney General Máire Whelan today to prepare formal legal advice on whether a referendum is required to ratify Europe's new fiscal treaty.

EU leaders struck a deal last night on the terms of the pact, whose objective is to reinforce the single currency by toughening Europe's budget rules.

The Czech Republic joined Britain in staying outside the treaty but the 25 other EU member states have agreed to participate.

A senior Government source said the prospect of a referendum remains in the balance but there is some confidence in Dublin that the pact might not necessitate a vote.

In Brussels, however, Taoiseach Enda Kenny insisted that he would not pre-empt Ms Whelan's advice, which is expected in the next month.

He also indicated that he did not express any view to his EU counterparts on the likelihood of a referendum.

"The Attorney General obviously will not be pressurised by anybody. It is a formal request and will receive a formal reply," Mr Kenny told reporters before leaving for Dublin.

"Obviously, you only amend your Constitution if you have to amend it and in that regard the Cabinet will await the decision of the Attorney General whenever she feels that she's in a position to respond fully and formally to that request."

Even if the Cabinet decides not to hold a referendum, a Supreme Court challenge appears inevitable.

Opposition parties are already signalling their readiness to go to the Supreme Court if the Cabinet tries to ratify the pact without a referendum.

Fianna Fáil leader Micheál Martin signalled his party would seek legal advice on the text and said his view remained that the people must be consulted on any significant change on Europe. Sinn Féin has adopted a similar stance.

The new treaty will be an international agreement operating outside the framework of EU law. After sharp divisions at the last summit over the decision of British prime minister David Cameron to veto an EU treaty, Mr Kenny said last night's discussions were conducted in a practical and commonsense manner.

"It did not reach the levels of decibels and activity of previous council meetings," the Taoiseach said. "There was a quiet conclusion to the meeting." The deal on the treaty came after Poland and France set aside their differences over the representation of non-euro countries at summits of eurozone leaders.

Although there is little enthusiasm for the initiative outside Germany, Chancellor Angela Merkel has insisted for months that a new pact is required to anchor a more sustainable fiscal culture in the law of member states.

"With this agreement we are far better insured against things that happened in the past not happening again," Dr Merkel said last night.

The talks came against the backdrop of controversy over a German proposal to have a European "budget commissioner" sent to Greece with powers to veto state spending. Dr Merkel held her ground on this front last night despite opposition from French president Nicolas Sarkozy.

As talks continue this week on a big contribution to the second Greek bailout from its private bondholders, an informal decision was taken at the summit to accelerate talks on the new rescue plan.

"We expect the authorities and all parties involved to finalise the negotiations on the new programme in the coming days," said European Commission chief José Manuel Barroso.

Preparations are in train for an emergency meeting of eurozone finance ministers next week to conclude a new deal with Greece.

Doubt over Greece's financial situation overshadowed the summit but EU leaders sought to direct attention towards a new effort to stimulate growth in the moribund economy.

"I am happy, though, that we have been able to raise the issue of small and medium enterprises and the internal market, and youth employment," Mr Kenny said.

"I'm glad the council have recognised this and President Herman van Rompuy has commissioned a number of papers and reports on it.

"I would like to see this kept central to the European Council agenda from here on. After all that's what European employment should be about: work and employment, and growth and opportunities."