Eamon Ryan (Dublin Bay South, Green Party) | Oireachtas source

I appreciate the chance to get the witnesses' advice. I will make a couple of comments first. Mr. Coffey made a good point about the question of how to compare one country with another. An interesting experiment - a survey unlike any other - is under way currently. With Brexit, everyone is leaving London, but people are not coming to Dublin. As much as we would like them to, they will not go to Longford or Leitrim either, but they could come to Dublin. However, they are not coming here because of housing, transport, schools, etc. This is clear if one asks them why they are instead going to Luxembourg, Berlin or Paris. They would love to come to Dublin, but they cannot because there is no infrastructure.

It is one real life measure by which it could be tested. That is the market in which we are competing.

Representatives from the Department of Finance were before the committee last week. God help us in terms of our economic data. We have real difficulties understanding what the size of our economy is. The witnesses are adding, correctly, to it today. We also have real concern about what our balance of payments is. We do not know some of the basic figures. In addition to the concern raised by the witnesses in that regard, another concern was raised by a representative from the Department of Finance who said the top five exporting companies account for 37% of our total exports. If we lost those five companies, we could lose 40% of our balance of payments. It is incredible. There are very few other economies in that sort of precarious position.

I will add a third caveat that the whole discipline of economics is in a state of complete crisis. It must be a shocking profession to be in at the moment when no one really believes anything in terms of the economic analysis. Kate Raworth, who wrote Doughnut Economics, says the basic tenets of the textbooks should be thrown out. The first lesson I learned in economics is that people are profit maximisers. However, all the assumptions of all the models arising from that have been completely debunked because we are not just profit maximisers. There is more to life than just making a profit. God help us because we are in a difficult situation in terms of making economic decisions. In a sense, one of the policy choices we have is in terms of the size of the State within the economy, however it is measured. As we have to live within fiscal rules, the choice is between a higher tax and higher spending policy approach versus a smaller one. We have a choice in budgets between giving tax cuts and increasing spending. Framing it in that way might help in some of the policy choices. Given what I have said about the infrastructure deficit, if the Irish Fiscal Advisory Council had a choice, as a policy maker, between a tax cut and a capital spending increase, what would it decide? Can it come to that level of political decision-making?

One of the ways in which we could assess things, given it is difficult because the economic figures are so uncertain, is to try to get assessments of productivity in all investment decisions and productivity increases. I am interested to know if the witnesses have any particular analysis of that. When it comes to infrastructure investment decisions, if we could show real productivity growth increases, perhaps it would overcome some of the concerns about the long-term budget implications.

Has the Irish Fiscal Advisory Council done further research or consideration on the risks to us in terms of not meeting our carbon targets? My understanding of the latest negotiations with Europe is we are facing a much more onerous 2030 regime. We may be starting from where we were expected to be in 2020 rather than from where we actually are. That more onerous approach might see not-insignificant fines, in the many hundreds of millions, introduced in 2021 and 2022 rather than later. Has the Irish Fiscal Advisory Council done any analysis or research on the fiscal risk involved in the failure to meet our carbon targets, given how far removed from them we are? The latest noises from Germany and France indicate they may be looking for us to count our targets straight away in 2020 rather than getting the pass we seem to be getting from the Commission, which would mean they would only really kick in in 2027.