Dr. Gabriel Fagan:

I do not know whether the Deputy was here when we discussed this matter earlier but the basic motivation is as follows. First, the 60% is not a target but a ceiling. Therefore, one could have a figure lower than 60% and meet the EU obligations. The second point to bear in mind is that the Governor is talking about a longer-term target. He is not saying do this in 2017 or 2018. He is basically saying, "once we make progress". It looks very likely that we will have a budget balance in 2018 and a falling debt ratio. I do not know when we would reach 60% but it may not be that far away. It might be 2019, 2020 or thereabouts, so we will have achieved those rules. The question then is, where do we go from there given that we have met those targets? The point the Governor is making is that if we look at the experience we have had, the volatility of the Irish economy, and at what happened during the crisis, we want to have a margin of manoeuvre if a very bad shock hits the economy in the future, which will happen at some point in time. We will be in a good position to say we can stimulate the economy, relax fiscal policy and tackle the problem without violating European rules. That is where the Governor is coming from. He suggests we get a level of debt which is sufficiently low that will provide a buffer so that the fiscal policy can respond to adverse shocks. In the past, there was no such buffer and, as a result, one had to have a contractionary fiscal policy at a time when the economy was going into recession, so one was making things worse.