Mr. John McCarthy:

No, I disagree with the Deputy. The rationale behind the fiscal rules is that cyclical revenues cannot be used to finance permanent increases in expenditure. That is what was done in Ireland until 2007. It is also what was done in Spain and some other countries and it meant that once the crisis hit, cyclical revenues collapsed overnight and we were left with a massive structural deficit. The fiscal rules are aimed at preventing this from happening again. What they do not do is state we cannot invest, redistribute or spend here, there or wherever the Parliament chooses. That is a matter for the member states involved to decide. What the fiscal rules do state is that if we want to do this, we must be able to finance it. In other words, if a country wants to invest more, it has to be able to finance the investment or take it from somewhere else. It is about redistributing towards priority areas. The fiscal rules leave plenty of scope for member states which are not in a straitjacket. They are about ensuring fiscal sustainability and that we do not repeat the mistakes of the past. There are flaws in the rules, but, by and large, they are good.