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Pressure eases on Coalition as referendum on treaty unlikely


Mr Kenny and
French President Nicolas
Sarkozy enjoy some
horseplay at yesterday's
European Council meeting
in Brussels

Mr Kenny and French President Nicolas Sarkozy enjoy some horseplay at yesterday's European Council meeting in Brussels

Mr Kenny and French President Nicolas Sarkozy enjoy some horseplay at yesterday's European Council meeting in Brussels

TAOISEACH Enda Kenny is highly unlikely to have to go to the people to approve the EU's tough new budgetary rules.

This morning, the Cabinet will refer the agreed treaty, including a limit on borrowing, to the Attorney General.

Fortunately for the Coalition, the treaty contains a get-out clause whereby the Government does not necessarily have to insert it into the Constitution, making a referendum less likely.

Mr Kenny refused to predict what the advice of the Government's legal adviser would be.

"Far be it from me to presume to speculate. You only amend the Constitution in our country if you have to," he said.

Mr Kenny said the Government had nothing to fear about holding a poll. If a vote is needed, it has until the end of this year to hold the referendum.

At the end of an EU summit late last night, Mr Kenny did not give any timeline on when Attorney General Maire Whelan will have to come back to ministers with her opinion.

But Tanaiste Eamon Gilmore admits the Government expects the new rules to be challenged in the Supreme Court if there is no referendum.

"I think it's been almost consistent that virtually every European treaty has resulted in some challenge in one form or another in the courts," he said.

The deal struck in Brussels also does not include any specific reference to a tax on banking transactions or giving up our low corporation tax rate -- but they remain on the table.

The Coalition has until January 1, 2013 to put the treaty fully into law . A failure to adopt the new rules will mean Ireland not being able to access future bailout funds from March 2013.

The treaty also bulks up the bailout fund and creates a €500bn pot for countries in financial difficulty.

Ireland was one of 10 countries that did not want the new treaty to be inserted into its Constitution. Before Christmas, the push was for it to be ratified at "constitutional or equivalent level". But the final text of the treaty says the debt brake, preventing Government's from borrowing, only has to come into effect in national law and be "preferably constitutional".

Germany led the demands for the strongest possible guarantees that the rules would be enforced, insisting it would have to be in the constitution of eurozone members.

Meanwhile, Mr Kenny did not raise the issue of the Anglo promissory notes at the summit, despite his Government's repeated warnings that some sort of deal on the method used to pay for the nationalisation of Anglo Irish Bank is essential to the country's economic survival.

Officials said before the end of the meeting that he was not raising the thorny problem of the promissory notes which will force the Government to borrow €3bn a year every year for at least a decade. He did, however, give a talk to his fellow leaders about the importance of small and medium-sized firms to the European economy.

Earlier this month, Finance Minister Michael Noonan said "technical talks" were being held in Brussels to find some sort of mechanism to enable the Government to delay repaying the money needed to bail out Anglo.

Any changes will need the unanimous support from all of the other 26 member states. The Government has been at pains to argue that there should be no direct link between a deal to reduce our debt burden and a deal to reform the treaty governing a debt brake.

Irish Independent