Dr. Martina Lawless:

We are not selecting either. We are discussing the rainy day fund as a proposal that the Department of Finance has put forward. In terms of preparing the economy for long-term shocks, the principle of a rainy day fund as a way of smoothing Government spending over the cycle is something we are interested in and supportive of. What we have pointed out in the report is that we currently have very little information on how a rainy day fund would be set up and how much funding would go in. There already have been changes in the proposed contributions and some uncertainty as to whether these would be flat or increasing over time, and whether they would be on a permanent basis or just for the current three-year proposal. We have very little information on how that rainy day fund would work or be funded.

The Fiscal Advisory Council rarely says, "Spend money on this rather than this." We speak very much at a total level of having all expenditure be based on a sustained level of revenues. As to whether this should, as Mr. Coffey has already said, be funded by tax cuts, expenditure increases and so on-----