MEP Paul Murphy challenges Referendum Commission

MEP for Dublin Paul Murphy has written to the Referendum Commission claiming their advisory booklet contains inaccuracies.




MEP writes to Referendum Commission seeking correction of inaccurate ESM claims in booklet


Irish state still has power to threaten veto over ESM to demand withdrawal of connection beween ESM and Austerity Treaty
Commission booklet is prejudging a political decision yet to be made


“I have written to the Chair of the Referendum Commission, Judge Kevin Feeney, this morning to bring to his attention an inaccuracy in the booklet issued by the Commission. The booklet states that ‘any future bail-out could not involve access to this particular source of funding.’ The source of funding referred to is the European Stability Mechanism.

“This is inaccurate and represents a prejudging of a political decision that has yet to be taken. The Oireachtas has not yet voted on the ESM, nor on the amendment of the Treaty on the Functioning of the European Union necessary to give a legal basis for the ESM. This means that the threat of a veto could still be used to demand the withdrawal of the ‘blackmail clause’ which creates the connection between the ESM Treaty and the Austerity Treaty.

“It is vital that people have access to the accurate information about this important question. I have asked for this inaccuracy to be corrected on the Referendum Commission’s website and in the booklet.”




Letter from Paul Murphy MEP to the Referendum Commission....




4 May 2012
Re: Referendum Commission booklet

Dear Judge Feeney,

I write to you concerning the Referendum Commission booklet on the ‘Fiscal Treaty’. I appreciate the hard work that has gone into its production. However, I wish to bring an inaccuracy in the booklet to your attention and seek that it be corrected.

In the section dealing with the “Effect of Treaty on financial assistance/bail-out mechanisms”, the booklet states that “any future bail-out could not involve access to this particular source of funding.”The source of funding referred to is the European Stability Mechanism. This is inaccurate and represents a prejudging of political decisions that have yet to be taken.

By just stating that 17 states have signed the ESM without explaining that this does not equate to ratification, the text of the booklet also gives the impression that the ESM is already in place. This is not the case. The Oireachtas is yet to vote on it as are the majority of Member States’ National Parliaments. In effect the text of the booklet is prejudging the political decisions to be taken by the Oireachtas and National Parliaments around the EU.

You were reported in the Irish Times today as suggesting that “the opportunity for a veto was now gone.” This is inaccurate in my opinion. Ireland (as with all other member states that have not ratified it) still has the right to veto the establishment of the European Stability Mechanism Treaty. The power to use this veto has not lapsed. This power flows from the need for an amendment to the Treaty on the Functioning of the European Union (TFEU), in order to give a legal basis to the ESM.

As you know, this is proposed to be effected by an amendment to Article 136, which will insert the following text: “The Member States whose currency is the euro may establish a stability mechanism to be activated if indispensable to safeguard the stability of the euro area as a whole. The granting of any required financial assistance under the mechanism will be made subject to strict conditionality.”

Without this amendment, the ESM would likely legally fall foul of the “No Bailout” provision contained in Article 125 of the TFEU. This is the why this amendment is being made.

As you aware, this amendment to Article 136 must be agreed unanimously by all of the member states. Therefore, Ireland still has an active veto over the establishment of the ESM. The threat of a veto could be used to demand the withdrawal of the clause in the ESM Treaty that makes the connection with the ‘Fiscal Treaty’.

It is therefore inaccurate to say definitively that“any future bail-out could not involve access to this particular source of funding”. That prejudges a political decision still to be made and is not legally established. A No vote in the ‘Fiscal Treaty’ referendum could be interpreted as a direction to the Irish government to use the threat of veto to demand the withdrawal of the reference to the ‘Fiscal Treaty’ in the ESM Treaty.

In addition, there is also a high profile legal case currently underway in Ireland, taken by Thomas Pringle TD, questioning the compatibility of the ESM Treaty with the Irish Constitution.

Finally, I would like to draw your attention to an argument made by Seamus Coffey (who incidentally supports the Treaty) in his blog here http://economic-incentives.blogspot....l-funding.html. He draws attention to the inclusion of the word “new” in reference to “new programmes under the ESM” being conditional on ratification of the ‘Fiscal Treaty’. He makes the reasonable argument that this suggests that extensions to existing funding, such as Ireland already has, may not require this ratification.

I would request that you clarify this issue in the booklet and on the Referendum Commission’s website. I would be very happy to meet or to talk over the phone to expand upon the argument.

I would like to inform you that I intend to make this letter public, given that these issues have been prominently in the media today.

Yours faithfully,

Paul Murphy MEP