Oireachtas Joint and Select Committees

Thursday, 11 June 2015

Joint Oireachtas Committee on Finance, Public Expenditure and Reform

Fiscal Assessment Report: Irish Fiscal Advisory Council

2:00 pm

Professor John McHale:

I certainly believe we are independent. We approach these problems as macroeconomists doing macroeconomic analysis. We do not come to this with an ideology of trying to shrink government. It so happens that no one on the council is pushing such an agenda.

We have been focusing on the fact that the Government's plans would see a substantial reduction in the size of government. Given the underlying spending pressures from demographics and other areas, we think this should be taken very seriously. Without putting things on an ideological or even policy footing, we believe it is important to recognise these pressures.

We have cautioned against tax cuts at this point. We are certainly not coming into it with any ideological agenda. What we do know is that if those in government do not get their macroeconomics right, if they make mistakes, it destroys people's lives. That is what happened during the crisis. If anything is driving us, it is to ensure it does not happen again. I know it can sound very technocratic and, perhaps, to Deputy Paul Murphy's ears, ideological, when we talk about something like a budgetary framework. We are pushing it because we know the kinds of mistakes that can be made by the political system. None the less, we absolutely believe in democracy and recognise that these choices ultimately have to be made by the Deputies and Senators. Given the kind of pressures politicians are under, they can make mistakes. Sometimes having a technocratic body like ours pushing back a bit-----

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