Collins (UEN). – Mr President, it is a very great pleasure for me and my Irish UEN colleagues to welcome here the Taoiseach, Mr Ahern, our political party leader, as President-in-Office of the Council.

Europe is very fortunate at this particular time to have the presidency held by a Prime Minister who is one of the longest-serving heads of government in any of our Member States. In fact, the President-in-Office and myself are co-signatories to the Maastricht Treaty.

With regard to the IGC, the failure to reach agreement at the December Brussels Summit is, undoubtedly, a serious setback for the European Union, but it is not a crisis. The Union will continue to function on the basis of the existing Treaties and the process of enlargement, with the accession of ten new countries on 1 May 2004. However, a hastily reconvened summit and a second failure to reach agreement on a constitutional treaty would quickly plunge the European Union into crisis. After the summit failure, the immediate need was for a period of calm reflection by Member State governments and EU institutions. I am delighted that the Irish presidency has already embarked on an intensive programme of consultations with fellow Member State governments during the first working week of its presidency.

I am also pleased to note that the Irish Government is most diligent in seeking clarification on the results of the bilateral meetings which took place at the end of the last presidency. It is important – indeed essential – to determine the exact position in which we find ourselves at the earliest possible opportunity. It is now time for all those involved in EU decision-making to demonstrate the necessary discipline and patience to avoid further failures and to await the report of the presidency to the Spring Summit.

All of us must avoid inflaming the debate by raising issues which could be interpreted as threatening in many national capitals. It is not helpful at this time to have some Member States threatening to reduce the size of the European Union budget. Nor is it helpful to have Member States floating the idea of a two-speed Europe. The European Commission, as guardian of the Treaties, must do everything possible to ensure that the idea of a two-speed Europe does not gather momentum. If some Member States wish to move forward at a faster pace on specific issues, then the enhanced cooperation mechanism already exists to enable them to do so. Already some, but not all, Member States are involved in the eurozone and the Schengen Agreement. These methods could be applied to other sectors or issues if necessary.

However, the suggestion that a small group of Member States could forge ahead, creating a two-speed Europe, is vastly different in scope. It is a highly destructive proposal, which could put at risk the effectiveness and even the very existence of the European Union. The debate on the IGC and treaty reform should be characterised by caution and by mature reflection. It is far more important to obtain a good result than an early result.

The Spring Summit will also focus on the Lisbon Agenda and I welcome the presidency's proposal to give renewed impetus to the reform goals agreed at Lisbon. It is in all our interests that the objective of making Europe the world's most competitive knowledge-based economy by 2010 be achieved. Some progress has been made and we are still a long way from achieving the agreed targets. We must focus on polices which will improve European competitiveness and productivity, while investing more on research and new product development. This is one area where the European Union can have a practical effect on citizens' lives by improving living standards and increasing environment opportunities.

It is regrettable that some Member States are now advocating a reduction in the size of the EU budget. At a time when the European Union is expanding to include ten new countries and when these countries are making stringent efforts to encourage economic growth, we have a duty at least to give these countries access to resources, which the existing fifteen have had access to in the past. It is in all our interests to encourage these countries to reach their maximum potential as soon as possible. The Commission will shortly bring forward proposals on the next financial perspectives. The Commission should ensure that the resources in future EU budgets are sufficient to provide for a continuation of existing EU programmes in an expanded Union of 25.

A related issue concerns the budgetary powers of this Parliament, where different suggestions have been tabled to increase and decrease the role of Parliament in this area. I support Parliament's view in insisting on maintaining its existing powers over the budget.

In external relations, as with previous presidencies, the Middle East will once again be a priority issue. I am pleased to note that this week Minister Cowen, as President-in-Office, is making an official visit to the Middle East, where I am confident he will make every effort to move forward the peace process in that region. The Irish presidency should concentrate its efforts on implementing the roadmap and ensuring that its partners in the quartet are committed to this goal. Only the roadmap provides the basis on which progress can be made towards a just and lasting two-state solution.

The priority that the presidency is giving to US relations is to be welcomed. The US is our biggest trading partner and is a country with which Europe has strong cultural and historical links. We have had political differences in the recent past but the time has now come to put these problems behind us. Indeed, I am of the view that the transatlantic relationship has not yet adapted fully to the new set of circumstances which exist following the collapse of the Iron Curtain, the effective removal of a security threat to Europe from the East and the emergence of the United States as the world's only superpower. Ireland is particularly well placed to improve relations with our American friends and I hope that the Irish presidency will further strengthen and deepen relations between the Eruopean Union and the United States.

(Applause)