Independent TD Pringle tells High Court he is concerned about ESM effects
INDEPENDENT TD Thomas Pringle has told the High Court he is very concerned the European Stability Mechanism (ESM) Treaty will permit an unregulated and uncontrolled new institution to bailout member states when the existing EU Treaties prohibit any such bailout.
Mr Pringle also said he fears, if the ESM is called on to bail out Spain and Italy, Ireland could "very quickly" be called on to provide the full €11.1bn amount of its required contribution to the ESM.
He did not know where Ireland would get those funds, it might have to borrow them from the ESM itself and then pay them back, he told Ms Justice Mary Laffoy. Ireland had to raise some €1.3bn for the ESM within the next 18 months, he noted.
He was also concerned the operation of the ESM would interfere with EU economic policy, place a huge burden on member states and encroach on their ability to govern their own economic affairs. The manner in which the ESM could call for capital placed a huge burden on the Irish State to raise that capital and infringed its right to decide policy, he said.
Mr Pringle said he had been concerned for some time about the proposed ESM and voiced those concerns in letters to the Taoiseach and government ministers over several months. He had also proposed members of the Dail and Seanad should petition President Michael D Higgins for a referendum on the Treaty.
He had been advised the ESM Treaty and the Fiscal Stability Treaty, approved by a referendum here last month, were interlocked and he felt the ESM Treaty should also have been put before the people in a referendum.
He was concerned the ESM was outside the control of EU institutions and was formed via the "wrong procedure" in which Article 136 of the Treaty on the Functioning of the EU (TFEU) was amended to provide for the ESM by a European Council decision taken by simplified revision procedure rather than the ordinary revision procedure requiring involvement of member states parliaments.
He agreed with his counsel John Rogers SC that Ireland is within an economic and monetary union (EMU) but said his concern was the ESM breaches the rules governing EMU set out in the EU Treaties. Articles of the TFEU expressly prohibit bailouts, the ESM breached what was prohibited and it was "vitally important" the EU operates within its ground rules.
Disregarding the ground rules "bodes very ill" for the future, he believed. He agreed some eight larger states of the EU could cause the ESM Treaty to come into force and said this "skewed" the entire decision making process within the EU and undermined the influence of the smaller states.
The Donegal South West TD was giving evidence on the second day of the hearing of his action aimed at preventing the government proceeding to ratify the ESM Treaty without first putting it before the people in a referendum.
Mr Pringle claims the February 2012 ESM Treaty - which provides for a €500 billion strictly conditional permanent rescue fund for the 17
member states using the Euro currency - breaches the Irish Constitution, EU law and the Treaties of the EU on several grounds.
The hearing continues.