THE Government must draw up a contingency plan in the event of a "doomsday scenario" whereby Britain exits the European Union, according to Junior Minster for Finance Brian Hayes.
Mr Hayes said an exit could have "devastating consequences" for Ireland, and the Government needed to draw up measures in order to protect the economy.
The issue is causing deep concern within the Government here, as fears grow that an exit could destabilise Ireland's recovery. Mr Hayes said the Coalition needed to begin preparing for a potential exit by Britain.
"We need to have alternatives just in case that doomsday scenario occurs. We need to be working on alternatives," he told the Irish Independent. "This could affect us very seriously.
"As the British public prepare for the referendum, it's really important that parties in Northern Ireland take an interest in this because they'll have the vote.
"I think we can use our influence with the British, as we do, because the issue of the North is now resolved, we have means of achieving more together, so we've got to be very conscious of this debate because it has, potentially, devastating consequences for our economy."
Mr Hayes said he believes Britain may be offered a "deal" prior to the referendum which will result in the country's three main parties campaigning against exiting the EU.
But he emphasised the need for parties in the North to take a hands-on approach in relation to the debate.
Mr Hayes was responding to claims by former Taoiseach John Bruton that a British exit would result in the need for passport controls to be implemented along the Border with Northern Ireland.