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

I contest strongly the assertion made by Mr. McCarthy in response to Senator Barrett - who was making similar assertions - that cutting capital when the crisis hit was anything but stupidity and folly. There was absolutely no rationale for it because it cost us more to do that. I will provide two examples, the first of which is housing. Cutting the budget for social housing in 2008 has cost us more. Obviously, it has cost us in terms of homelessness and an increased housing crisis, but it has also cost the Exchequer more because the State has been obliged to fork out a hell of a lot more to the private sector to cover the housing crisis. We must pay more to private landlords because we did not provide council housing. Is this not a classic example of how, when the market turns down or crashes, we need things that are not linked to the ups and downs of the economy because they always are needed, such as housing?

It is not to do with the ups and downs of the market but how many people need roofs over their heads. Whether the market goes down or whatever it does, we need roofs over people's heads. One way or the other, it must be done. The question is whether to do it cheaply or expensively. What is the best value for money in doing something that simply must be done? Is that not one example that runs completely contrary to the assertion that we had to do it? We are paying a huge price for a massive mistake in that area.

Can anyone explain to me how the leveraged investment model does not end up costing ordinary people, the taxpayer, more for whatever project? The difference between this and doing it with 100% public investment for vital infrastructure and services, such as housing, is that there must be a profit for the private investor so it costs us more. It is not even disputable. It must cost us more because someone else is in the picture who wants a cut. In order to get in the money, we must provide guarantees that we will take the first hit if there are losses. If things go belly up, we promise, in order to get in private investors, that we will take the first hit. Second, we must promise enough profit and return for the private investor to come in in the first place. Our answer to the fact that we have a dysfunctional economy where the market decides it is not profitable to invest is to get down on our knees and say please invest and we guarantee, if anything goes wrong, that the taxpayer will cover the losses and the return is guaranteed. How can that possibly be a better way to invest than us doing it ourselves, where we do not have to give a cut to someone else? We invest in something because we need houses, roads and water infrastructure. These are vital and, regardless of the ups and downs of the markets, we must have them.

One can possibly make a different argument for areas of the economy that are not vital and we can debate where that line begins and ends but in certain areas we just must have certain things. Bringing in the private sector, where it must have a profit, cannot be as good value for money as us doing it ourselves.

How confident can we be that we can get this investment? We have big announcements about how we will get an investment with our €8 billion seed capital, which will increase to €21 billion and magically turn to €300 billion. How do we know that it will be coming in? Is it possible it will not appear? Is the list of projects publicly available? Does social housing feature in the list of projects?