New figures show we paid €360m more into Brussels coffers than we received in grants in 2020
Charlie Haughey did not bat an eyelid when he heard that Ireland was getting back almost £6 from the EU coffers for every £1 it put in.
“Well, it’s not half enough,” he told this writer emphatically.
That was way back in November 1989 and the Fianna Fáil Taoiseach was preparing for his golden moment on the EU stage as Ireland was about to take up the six-month rotating presidency, or chairmanship. The stint involved hosting those political giants like Helmut Kohl, Francois Mitterrand and the man Haughey dubbed “the old fox himself”, Giulio Andreotti of Italy.
Today, 30-plus years on, we are given more evidence of how things changed for Ireland. The EU’s own audit service has reported that last year, 2020, this country paid €360m more into the Brussels coffers than it received in agriculture, fishery, social, regional and other grants.
In fact this has been happening in plain sight since 2018 with Ireland averaging €377m in yearly net EU contributions over the three years 2018, 2019 and 2020.
But a number of points are worth quickly making to give that figure some context. First is that €360m in net contributions is relatively small stuff when you compare it to the almost €90bn in the 2022 Irish Budget spend.
When Charlie Haughey was glorying in all that lucre – also revealed in the EU audit service’s figures back in 1989 – he was talking about an Ireland which had been 16 years a member of the EU and was still averaging just 60pc of the per-capita wealth in the bloc.
This country had a lot of catching up to do. The man who helped unlock the golden door for Ireland was the inspirational French head of the European Commission, Jacques Delors, who got solid support in this and many other projects from the Paris-Berlin axis of Mitterrand and Kohl.
Delors took some convincing and there were hard negotiations involving Haughey and Bertie Ahern – and later Albert Reynolds and Dick Spring – in the Irish Government. They were ably backed by Ireland’s then-commissioners, first Ray MacSharry and later Pádraig Flynn, who used all their influence – and then some.
The net result was that Ireland got €1.2bn per year every year in EU grant aid for the decade 1989-1999. The most visible evidence of this lavish aid is the roads system but there were other developments. And there was a time in the mid-1990s when no Irish development would be talked of without a prominent role for “EU money”.
And EU grant aid had a big role in Irish domestic politics. In November 1992 when Albert Reynolds’ Fianna Fáil suffered losses in a very ill-judged general election, he used slightly over-sold claims of having secured €8bn in grants over the coming eight years, and it boosted his success in putting together a coalition with a resurgent Labour.
But there were fears that too much talk of “EU free money” was cheapening Ireland’s standing in Brussels and the other capitals. There was also a well-founded fear that in the longer term, when such grants were played out, Irish people would be hard to convince about more durable benefits of membership, like market access and other links.
This was surely a factor in the loss of a referendum for the EU Nice Treaty in June 2001 and again in a vote on the Lisbon Treaty in 2008. Both these votes were re-run after negotiated changes and each passed with a convincing majority. But it did not do the image of Irish democracy much good.
Happily, these incidents proved to be short-term setbacks and opinion polls consistently show high support among Irish people for ongoing EU membership. By the time Brexit became a reality in June 2016, it was clear that Ireland was definitely anchored in the EU.
It was remarkable that when EU leaders formalised the division of a post-Covid-19 aid package this past summer, there was no fuss at all about Ireland’s remarkably small take. In fact Ireland got less than €1bn against €191.5bn for Italy, which admittedly had been devastated by Covid-19.
Two further points are worth noting. One is that Ireland now has 111pc per capita average GDP per citizen. Yes, that is 11 points above the average – compared with just 60pc of the average 30 years ago.
Ireland is also now in line for special Brexit aid with a €1.2bn share of some €5bn in total for countries disrupted by the EU-UK messy divorce. That is real testimony to EU support which so far has been stellar.
But it is very likely to be a one-off. From now the real benefits of EU membership are access to a market of 450 million people and the confidence Irish young people get from participation in education programmes like Erasmus.
Now it is the turn of the newer members like Poland, Hungary and the others to benefit from development opportunities under generous EU grant aid programmes.
John Downing is a former Europe Editor of the Irish Independent and reported from Brussels from 1989 to 1999.