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Dublin: 2 °C Sunday 23 November, 2014

Central Bank Governor backs Fiscal Compact Treaty

Patrick Honohan has argued in favour of ratifying the Fiscal Compact Treaty – saying signing up was the “safer alternative” for Ireland.

Image: PA

THE CENTRAL BANK Governor has this evening argued in favour of ratifying the Fiscal Compact Treaty, saying signing up was the “safer alternative” for Ireland.

While acknowledging that fiscal policy would be tighter under the treaty than in the original Stability and Growth Pact, Patrick Honohan said the treaty’s rules offered “considerable discretion and judgement” which would offer flexibility.

Addressing the Annual Meeting of the Irish Economic Association in Dublin tonight, Honohan stressed that European cooperation “must emphasise a growth and employment focus which, if successful, could have the effect of dissolving debt and deficit problems faster than anything else”.

He said he believed that the Government had done the right thing in its support of the treaty, saying that do otherwise would be ”turn our back on a framework of European cooperation at the heart of  what has been  – despite the recent reversals – Ireland’s very considerable economic progress over the past four decades”.

Read: Honohan’s speech in full>

Read: The Oireachtas’ briefing note on the Fiscal Compact Treaty>

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