Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

The Deputy knows, from previous experience and discussions that took place around the Summer Economic Statement, that even if there were no Brexit, the figures in the statement are subject to change between now and budget day. As new data comes in, figures are always revised. Therefore, I would not attach too much importance to the phrase the Deputy quoted. There will be changes. Before Brexit, we expected the changes would be positive. The earnings on which we will levy corporation tax have already taken place. Regarding income tax, we do not foresee a decline in employment between now and the end of the year. The tax streams for October and 2017 are relatively fixed. That is why there is very little variation.

We had to take into account the possibility of a vote in favour of Brexit, and there is a section in the Summer Economic Statement that deals with it and gives the expected decline in growth based on it. The data in the forecast was threefold: data produced by the UK Treasury, to which we had access; work the ESRI published last autumn; and work done by the equivalent of the ESRI in the UK. The forecasters in the Department of Finance assessed the data and produced the figures in the Summer Economic Statement.

This is the initial impact. Beyond that, it will depend on what the new arrangement is between the UK and Europe. If the new arrangement is full access to the Single Market and free movement of people, goods and labour, the impact will be low, and may even be to our advantage. If it is very difficult to come to an agreement and it reverts to some sort of World Trade Organisation style relationship, whereby the UK is treated as an economic unit outside the EU without any specific bilateral arrangement, there may be tariffs, border posts and all sorts of inhibitions to trade and the impact will be bigger. While it is impossible to forecast the impact with any accuracy, it would be serious.

The Taoiseach has already commenced positioning us for negotiations. Our position is clear. We would like the UK to continue in the Single Market. When Norway was negotiating with the EU, the "price" of access to the Single Market for a non-member country was that it would respect the four freedoms. One of the primary freedoms is the free movement of people, which seems to have been a crunch issue during the campaign by those who advocated Brexit. It will be very difficult to combine full access to the Single Market with free movement of people. It was around this that the Brexit advocates in the UK seemed to have greatest difficulty. It is an evolving situation and it is very difficult to know who in the UK will be negotiating, what group of people they will primarily represent, what Government will be in place and what the alternative government will be. There is no clarity.