Tánaiste Joan Burton has called on Greece to make credible progress in boosting the tax take and fighting corruption before it receives the final €7 billion loan tranche frozen in its second EU/IMF programme.
Ms Burton was speaking in Berlin after "friendly and positive" talks with Mr Sigmar Gabriel, federal economics minister and leader of the Social Democratic Party (SPD) – sister organisation to her Labour Party.
Mr Gabriel briefed her on the inaugural Berlin visit earlier this week of Greek prime minister Alexis Tsipras, leader of hard left Syriza party.
Ms Burton said Irish people were sympathetic to Greece, reflected in their €350 million contribution to its EU/IMF programme, but that Ireland wanted to see more progress on tackling corruption and boosting tax revenue.
“It’s difficult to see how the Greek government will be able to meet a lot of the commitments it has made unless the system of collecting taxes is reformed,” she said. “Tax revenues seem to have fallen substantially and it is difficult to have an expensive programme like the one the government wants unless you have adequate tax revenues.”
She said Mr Gabriel told her how good the Irish recovery story was going down in Berlin, "but that it probably needs to be better known in Germany and throughout the EU".
Mrs Burton said she received a sympathetic hearing in their talks on Ireland’s request for a technical adjustment in how the EU calculates growth – and thus the stability pact debt ceiling — to emphasise recent growth rates rather than the record contractions of the crisis years.
“The way that formula is calculated would leave us with little room to manoeuvre in terms of investment and expanding the economy,” said Mrs Burton.
After winning Germany over to previous debt and loan concessions — extending loan maturities and recycling loans with more attractive interest rates — the Tánaiste said she was “confident that current discussion will be successful as well”.
Mrs Burton also held meetings with Germany's trade union confederation and with deputy labour minister Jörg Asmussen, a former senior official at the European Central Bank (ECB). The Labour leader said in talks that she would like to see the ECB mandate expanded to take into account employment rates, similar to the US Federal Reserve and the Bank of England.
She also backed Mr Gabriel’s recent call for the EU to be as stringent with driving investment as it does to debt. The SPD leader called last month for the EU to fix a minimum investment quota, similar to how it caps borrowing in the stability pact.
Ms Burton said she invited the SPD leader to Dublin to discuss that and other proposals by Europe’s centre-left to drive a “change in emphasis” in the EU towards greater investment in social and infrastructure spending.
“What separates the centre-left from the centre-right is: we want to focus on people’s standard of living,” she said. In the evening Ms Burton signed the book of condolence in Berlin cathedral for the German victims of Tuesday’s air crash.
