Paschal Donohoe wants to tap EU funds for billions in wartime coronavirus aid.
The Minister for Finance and Taoiseach Leo Varadkar believe that we will have to borrow our way out of the Covid-19 recession in the medium term.
And in speech to the IIEA (Institute of International and European Affairs) this morning, Mr Donohoe said that the money will be available through the EU in a new form of wartime aid.
He said he and Mr Varadkar are "in favour of measures that go beyond ‘peacetime’ economic policy.”
These special wartime grants will be coming down the line through Europe and Mr Donohoe is of the firm view that they need to be tapped as much as possible by Ireland.
France and Germany started the flow with the promise of over €500billion this week and it’s anticipated that there could be a total of €2trillion on offer to get the EU through the emergency.
Europe has not seen a need for urgent funds like this since World War II and the famous Marshall Plan which followed.
This helped rebuild a war-torn Europe and it served as the foundation stone for the success of the EU in the decades since.
Mr Donohoe indicated in his IIEA speech that the Government is looking to get as much of this free or cheap money as possible.
He said: “Next week, the European Commission will bring forward proposals on linking the Recovery Fund to the new Multiannual Financial Framework.
“Earlier this week, France and Germany made an important contribution to Europe’s recovery efforts with their proposal for how a Recovery Fund would work, based on the Commission borrowing €500billion to provide to Member States through the EU budget.
“Our citizens want, and expect, the EU to be ambitious and transformative in its response to this unprecedented crisis.
“Taken together, the EU economic policy response meets these expectations, amounting in aggregate to nearly €2 trillion or 15% of EU economic output.”
Mr Donohoe added: “While what is being proposed today does not amount to mutualisation of debt within the EU, the ability of the Commission to borrow significant sums to finance EU budget programmes would, if it is agreed, represent a significant step forward in European integration.
“I believe that primary responsibility for management of our economies should continue to rest at national level.
“However, given the scale of the crisis and in solidarity with those worst hit, the Government has been strongly in favour of measures that go beyond ‘peacetime’ economic policy or positions.”
