Joan Burton (Dublin West, Labour) | Oireachtas source

I welcome the members of the Irish Fiscal Advisory Council. Following Mr. Coffey's fairly extensive answer, I wish to raise two points. In regard to the calculation, Mr. Coffey said fairly trenchantly that measuring Ireland’s debt against GDP has become increasingly meaningless, given recent distortions and so on. The proposals being discussed by the CSO and other bodies about recalculating that in respect of GNI* has also led to a situation where at this committee last week, one of the assistant secretaries in the Department of Finance spoke a debt to GDP target of 45% into the long run. I would like to know whether the Irish Fiscal Advisory Council shares the view that Ireland needs a very significant infrastructure investment in order to modernise the economy and to keep the economy competitive pre-Brexit and post-Brexit, in particular in areas such as public transport and finishing off the roads network, which is incomplete, especially in large sections of the west coast and the connections between the major cities of Cork and Limerick. Are the two aspirations inconsistent - in other words, the suggestion has been made but there has been no detailed work that I am aware of that PPPs could replace direct Government spending on infrastructure. However, from what I know of EUROSTAT, and the witnesses probably know a great deal more of its inner working, EUROSTAT increasingly is looking unfavourably on PPPs, as being rather much the same as direct infrastructure projects because if one builds a public hospital or a public road, even if the financing is done by private means or through private mechanisms, essentially the State carries the risk, because it cannot close down a public hospital, a public road or a public courthouse built by a PPP. That is not going to happen. We have several examples from the UK, including Scotland, and from different parts of Europe that PPPs are a particular construct. Mr. Coffey commented on the measurement of the debt to GDP ratio being largely meaningless, does he share the approach in developing this GNI*? If so, could he give us an explanation in simple English of what it means? We feel we have stars in our eyes in relation to GNI*, not being mathematicians. I am very concerned about the very hardline stance of the Department of Finance. Last year when it came to the budget, this committee was told by the Department of Finance that it was all signed off but on budget day, it was very significantly different. That was pretty much on the day before the budget; it was not months or weeks in arrears. Will Mr. Coffey give us his thoughts on this? We are preparing for the scrutiny of this year's budget and we have a stand by the Department of Finance of working to a debt level of 45% of GDP. We also have an infrastructural deficit - I do not know if the IFAC shares that view - which needs to be addressed. How do we reconcile these two apparently irreconcilables?