Kenny criticises German proposals

Fri, Oct 19, 2012, 01:00

TAOISEACH ENDA Kenny has played down fears that a new European Union banking supervisor could be illegal and criticised the timing of German proposals to allow the European Union to vet and veto national budgets.

Mr Kenny said EU leaders “have weeks and months, but not years, to fix our problems and build a functioning and viable monetary union” and must fulfil commitments made at a June summit to break the link between bank and sovereign debt.

That involves the creation of an EU-wide banking supervisor, which would open the way for banks to tap a permanent bailout fund called the European Stability Mechanism.

Media reports yesterday raised concerns that establishment of a banking supervisor would require changes to EU treaties and could trigger a referendum in the Republic.

“I don’t share that view,” said Mr Kenny at a congress in Bucharest of the European People’s Party (EPP), to which Fine Gael belongs. “In my view the decision of June 29th is clear and would not require treaty change . . . The important thing is to move ahead with implementation of decisions already made, and if questions of legality arise they can be dealt with.”

In response to questions about German chancellor Angela Merkel’s proposal that the EU adopt powers to assess and intervene in national budgets, Mr Kenny said now was not the time for such a move.

“I think people would be quite willing to accept change in future when they see current problems can be dealt with . . . When they see prosperity returning, the economy growing and jobs being created for their families, then they will say ‘Europe is on its way back and let’s take more steps to ensure this never happens again’.”

On a day when Minister of State for European Affairs Lucinda Creighton was elected as a vice-president of the EPP, the Taoiseach said he was not irked by an Irish Times poll showing satisfaction with his Government had fallen six points, to 21 per cent, since May.

“We never said this would be a bed of roses. We inherited an unprecedented legacy of wreckage, financially, economically and in so many other ways,” he added. “I know this is painful and challenging but . . . we did say we would not back away from the scale of the challenge that people mandated us to implement.”