Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

On section 8, this is probably where the real meat is with regard to the legislation because we are being asked to pass legislation here which stipulates a percentage of our economy, where it has been drummed before into everybody in the finance committee that GDP is not the measure of our economy but GNI* is and we all use that reference now. When we are dealing with this legislation, however, we revert to GDP, which is an issue in itself. It is not the big issue, however, because if one uses GNI*, one could use a different level and GDP captures some of these corporation windfall taxes in a more accurate way, and so on.

The issue here is that in the legislation we are being asked in the first paragraph, between the years 2024 and 2035, to commit 0.8% of relevant GDP into the future Ireland fund. As I said, I supported the resolution last year to transfer €4 billion from the Exchequer into the previous fund and I believe that that surplus should be invested into the fund but this legislation does not stipulate that it needs to be in the case of surpluses, in the first instance. That is not the case.

Today, we have to look at legislation which goes out to 2035 and beyond, as this first paragraph deals with 2035. One may be in a situation where there is not a surplus. One may also be in a situation where one may not see a significant deterioration in the fiscal environment. One might have a gradual step change that would leave one in a situation where one does not have those large surpluses. Some 0.8% of GDP in 2030, for example, is one of the years in which we are going to have to make that transfer. Does anybody in this room know what that amounts to? Do we have any projections from the Department of Finance on what the transfers we will make out to 2035 will be? We have in the stability programme update 2024 numbers which go out to 2027, which is for the next three years. We do not know the numbers but, more importantly, there are no projections. Even in the stability programme update 2024, we do not have a five-year projection at the minute and the Irish Fiscal Advisory Council continuously criticises the Government on its failure to do that. This legislation even goes way beyond that.

The point I am making is that we are putting a number in legislation which looks good and is absolutely affordable in terms of where we are at today but we are committing ourselves to that over a period of time, notwithstanding the provisions within this section which allows the Minister to bring a resolution either to reduce the payment by 50% or not to make a payment at all.

The point I am making is that this approach is the wrong one. The current Minister's predecessor, the Minister, Deputy Donohoe, brought in legislation on the rainy day fund which committed a set amount of expenditure each year but none of those expenditures was actually met. Resolutions had to go before the House at least three times each year to ensure that the commitment was not met. One can argue that there were circumstances, and all of the rest, and there were. I am not denying that scenario. Using those types of numbers is problematic.

The second concern I have on this is in regard to the next section, which I will mention because I am sure the Minister will mention it in his response. It states that the Minister for Finance, in consultation, can bring forward a resolution which would allow for 0.4% of GDP to be transferred into the fund from the Exchequer in a scenario where there has been an assessment carried out by him or her, and also on foot of a recommendation from the Irish Fiscal Advisory Council that it is warranted and that a smaller amount is paid into the fund, or, indeed, to make no transfer whatsoever. I do not believe that is good scenario either. The reason is that one may be in a situation where if one looks at 0.8% of GDP, taken in today's numbers, that is in excess of €4 billion. This legislation will say - in today's numbers it is €4 billion - it will increase and will go up-----