Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance) | Oireachtas source

I think that is more a political battle we have with the Government. I also think that the question of whether one makes this adjustment through taxing the financial services sector, the FTT, wealth tax or taxes on higher earners as against cuts in public expenditure is a political battle we must fight.

It is the council's job to flag the dangers and down sides if they are coming up. I think I was the first Deputy the last time to ask about the area of housing, the potential for a housing bubble and the macro-economic danger that might represent. Since we had that discussion, at which point the council said it would look at it, it has become more manifest. Could the witnesses comment on the danger that represents? What seems to be happening encouraged by Government policy is that the big outside investors who are coming in and buying up all of the property are quickly developing a monopoly and rents are going up. One spin-off of that is a housing crisis and it will also affect small and medium enterprise. Given the tax breaks that are available for this kind of activity, much of that money could go out of the economy.

We recently held a meeting with the finance committee of the German Bundestag. I am probably in a minority in thinking our policies vis-à-vismultinationals and corporate taxation are dangerous, but there was agreement from our German counterparts in this regard. We have a big gap between GNP and GDP which is essentially accounted for by multinationals, which appears to make us vulnerable to problems in that sector. The Bausch & Lomb events suggested we could face real dangers. An aggressive multinational employer demanded 20% pay cuts across the board and got its way through fear. If other multinationals were to act in the same way, we could be facing a wave of wage deflation which could pose a serious threat to the capacity of the domestic economy to recover. This highlights the vulnerable position in which we are putting ourselves by our heavy reliance on this sector. The Germans advised us to develop our own industrial capacity, including small and medium enterprises. Given the huge gap between GNP and GDP, do the delegates see our disproportionate reliance on this sector as a structural danger to the economy?