Dail Statements – Brexit

April 25th, 2016 - Pat Breen

Deputy Pat Breen: As this is the first time that I have the opportunity to address the Thirty-second Dáil since the general election, I would like to thank my constituents for their vote of confidence. I congratulate the Ceann Comhairle on his election to the job in which he is about to serve.

I welcome the opportunity to contribute to this debate. It is a very good debate and it is great to see the Minister for Foreign Affairs and Trade, and the Minister of State at the Department here to listen to Members’ views on this very important issue.

There is a nervous anticipation across EU member states as UK voters go to the polls on the 23 June. The outcome of that referendum will not only determine the UK’s future relationship with the EU, but depending on the outcome, it could trigger a series of events which would have profound implications for the remaining EU member states and leave countries like ours particularly exposed given our close trading ties and our special relationships with Northern Ireland.

This question mark over the UK’s continued participation in Europe is not only lending itself to a period of uncertainty from now until 23 June, but we could be facing into a few years of uncertainty. If the UK votes to leave the EU, we will find ourselves in unchartered waters. There is no precedent for such a move. No other country has ever sought to exit the EU. Article 50 of the Treaty on European Union would come into play. Under this article, a country would automatically cease to be a member of the EU two years after it lodges official notification to withdraw if in those two years there was no agreement by the UK or member states to extend the date or a withdrawal agreement set a different date. Either way, there would be huge uncertainty and given the volatility of the markets, it is more than likely that the uncertainty would precipitate another European-wide recession.

Could Brexit mean the return to border controls? I note the recent comments of the British Secretary of State for Northern Ireland, Ms Theresa Villiers, that the Border between Ireland and Northern Ireland will remain unchanged. Nevertheless, there are questions to be answered. If this Border were to become an EU external border and if at some point this country opted into the Schengen Agreement, it could spell trouble ahead. At the moment, the common travel area allows Irish and UK citizens to be treated equally, particularly in terms of passports and employment. There is also equality of access to employment, social welfare and health care, for example. If at some future date Ireland decided to join the Schengen Agreement and the UK was outside the EU, instead of breaking down borders, we would actually be building ones.

While the British Secretary of State for Northern Ireland has said that Brexit would not mean the introduction of UK border controls, we have to protect the common travel area and we must be at the table in any discussions on Northern Ireland in any future negotiations between the UK and the EU if they are to take decisions to withdraw from Europe.

The peace dividend has also brought a new era of cross-Border relations. The increase in tourism and trade is benefiting the entire island of Ireland. Last year, an estimated 8.6 million overseas visitors came to Ireland, North and South, delivering revenue of about €4.2 billion between both economies.

One of the most important developments in terms of boosting cross-Border tourism was the introduction of the British-Irish visa scheme. This scheme was rolled out to replace our short-stay visa waiver programme which was introduced in 2011 and which allows nationals from a number of countries to travel from the UK to Ireland using their UK visa. This scheme was initially opened for visitors from China and India and the plan is to open it further in future. It allows a person to visit Northern Ireland or the UK and Ireland on a single visa. A tourist from China, for example, who might want to visit Titanic Belfast can now cross into the Republic and come down to Clare to visit the Cliffs of Moher or Loop Head on that Irish short-stay visa. It allows them travel back up to Northern Ireland or vice versa, as they do not need a re-entry visa. It is a very pro-tourism and business initiative which is working extremely well as tourism numbers from China, India and other countries grow.

I would be concerned if a joint initiative like this with such tangible benefits for both jurisdictions were jeopardised in the context of Brexit. Any return to the bureaucracy that prevailed before this scheme was introduced would put at risk the opportunities for cross-Border tourism growth, particularly in the Chinese and Indian markets, and would be a step backwards.

Our cross-Border trade is very significant. In 2014, total cross-Border trade in manufacturing came to just under €3 billion. According to InterTradelreland, nearly two thirds of the exports of small firms in Northern Ireland come across the Border while almost a sixth of exports of small firms here go to Northern Ireland.
We have worked hard to cement ties between North and South. We must sustain our strong relationship and maintain our existing special arrangements. This year, we are commemorating the centenary of the 1916 Rising and, 100 years on, a new chapter has been opened in our relationship with our nearest neighbour. Developing and enhancing our bilateral and trading relationships will be critical in maintaining this new era of relations between our two countries.
Every week, Ireland and Britain trade over €1 billion worth of goods and services. Up to 200,000 jobs here are supported as a result of our exports to the UK, making it an important market after the US and Europe. Some 42% of Irish food and drink exports worth €4.1 billion went to the UK last year. Up to 55% of Irish exports in the timber and construction sectors, as well as almost half of Irish clean technology and electronic exports, are to the UK.
The ESRI, Economic and Social Research Institute, estimates that post Brexit, it is likely that bilateral trade flows between Ireland and the UK would be reduced significantly by as much as 20% or more. Such an impact on our agriculture, food and beverages sectors would be more acute as they are more dependent on exports to the UK. Our agrifood exports to the UK were worth close to €11 billion in 2014. Teagasc concurs with the views of the ESRI about the impact on our agrifood exports, warning we could see potential losses of between €150 million and €800 million per year in a post-Brexit scenario.

Another significant report worth noting is that of Dr. Alan Matthews, professor of European Agricultural Policy at the Department of Economics at Trinity College Dublin. His report warned that “trading costs between Ireland and the UK would increase”. He also warned about the potential additional burden our agri-exporters would have to bear. For example, our animal-slaughtering facilities which wish to export to the UK could have to be certified by both the UK and Irish authorities. The additional costs involved would make our agri-exports less competitive.
There is also the potential reduction in direct payments which Irish farmers could be facing. The UK contributes around 12% to the EU budget. Accordingly, post Brexit, to maintain the current level of payments, the remaining EU member states would have to increase their contributions, an unlikely development in the current economic climate when most EU member states are running budget deficits.
Recent poll trends indicate a narrowing in the gap between both sides. However, there are 62 days to polling day. Much can change during that period, as we know ourselves here. There are over 400,000 Irish people born in the UK who are entitled to vote, with the Irish diaspora at around 5 million, as well as 300,000 UK residents living here. While it is proper not to interfere in the democratic process of another sovereign state, we must raise awareness among the Irish of the consequences to their future entitlements in the UK and for the island of Ireland.
I welcome the fact that the Taoiseach and the Minister for Foreign Affairs and Trade, Deputy Charles Flanagan, have been proactive in this regard. I also welcome the Taoiseach’s comments this morning that we will be prepared as possible to manage the consequences should the decision be for Britain to exit the EU. We must, however, be positive.
We need to have a pro-Europe campaign, explaining how trade relations between Ireland and UK are so important. Whatever decision comes from this, we must respect it.
Britain is a large country with a growing population. It is estimated that by 2050 it will have a population of 77 million people, which could make it one of the largest countries in the European Union. A Brexit would have a significant effect on Europe as a whole.
However, whatever the decision is, we will respect it. In the meantime, we must raise awareness, give our perspective and continue all we can do to play our part in this regard. I welcome this important debate and look forward to ensuring Ireland plays its role in the referendum in whatever way it can.