Creativity - IDA Ireland

» THE IRISH MIND
‘Inawayyou
can see this as
the policy
completion of
economic and
monetary
union – the
parts that we
didn’t include
10 years ago
when we
signed up to
the euro’
years ago – including us – we
would be doing, we wouldn’t
have believed it possible.
“I think what keeps me so
motivated is that it is endlessly
possible. We keep setting hard
challenges for ourselves and
we always get there – in a complicated
and expensive way at
times, but we do get there!” she
laughs.
FINANCIAL GOVERNANCE
The financial crisis of recent
years, and the travails of
Greece, Portugal and Ireland,
have brought into stark focus
some of the inherent weaknesses
in the European project.
It had clearly not foreseen,
and was not prepared for such
remarkable challenges. However,
says Day, whose role also
sees her closely involved in
financial governance, there is
a determination at EU level to
ensure the necessary changes
are made.
“The thing now is to coordinate
our policies much
more, and to start with a much better set of indicators to see
when things are getting off-track,” she stresses. “Look at the
case of Ireland where wage competitiveness was being seriously
eroded, and look at the correction that has taken place since the
recession – spontaneously without anybody imposing it. Had we
been monitoring that in more detail earlier on, we would have
seen this bike starting to get out of control. So we want to have
those kind of monitoring mechanisms in place. It’s not a guarantee
that we will not face problems in the future, but it should
mean that we do not face the same problems.
“We are now, of course, in the business of drawing lessons for
the future to ensure that we don’t have a repeat of what has happened,
and I think one of the lessons is clear – that we need
much more co-ordinated policy-making.
“For years the Commission has been running after member
states trying to get them to change decisions, but we are now putting
in place a very tight system of economic policy co-ordination
for the future,” she continues. “In the first half of the year the
Commission will issue recommendations to each member state
which they should then incorporate into their budgetary and economic
policy for the following year. I hope that by getting ahead
of the curve we will have more impact, and also make it politically
easier for governments to accept recommendations.”
The member countries have committed themselves to following
the Commission’s recommendations as a general rule, or to
explain in writing to the Commission should they not. “I think
that will help,” says Day. “Peer pressure on governments to follow
the right policies in future, combined with much better monitoring
and early warning will, I hope, help us to do away with
the problems of the past.
“My belief is that something has changed in this crisis,” she
says. “I think there is a better understanding now of the interdependence
of our economies, and there is a determination on
the part of many to ensure that we enact our economic policy
differently in the future. In a way you can see this as the policy
completion of economic and monetary union – the parts that we
didn’t include 10 years ago when we signed up to the euro.
“And then we also want to adapt the policies at EU level to be
part of accompanying this process, so we are currently preparing
a proposal for the budget from 2014–2020. We want that to
be the Europe 2020 strategy in numbers, and to put the money
into research, into infrastructures, into energy.
“One of the things that we did recently was to fund an interconnector
between the UK and Ireland so that the wind energy
Ireland generates, above that which it needs, can be exported.
This will help Europe to be more sustainable in its energy use,
and of course Ireland can make very nice revenue from that. So
it’s those kinds of initiatives we have in mind. The member
26 INNOVATION IRELAND REVIEW Issue 2 Spring/Summer 2011