Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I will deal with each of them in turn. With regard to whether there are any other examples of countries that are well advanced in doing this kind of work with a European setting, the answer is "No". When we commence this work in terms of putting together a fund, we will be in the first wave of countries that are looking to carry out this work well. In terms of compliance with fiscal rules, where there is an intersection with current EU fiscal rules, under the current fiscal rules, there is provision for expenditure to be used in response to so-called exceptional circumstances. Given that I would only be proposing to use the rainy day fund in light of exceptional circumstances, there is some fit there but once we are clearer in how we want to structure the rainy day fund and how it will operate, we will have to engage further with the Commission with regard to that. I am optimistic about such discussions.

The European Commission understands the distinction between the day-to-day challenges, the expenditure consequences of the day-to-day management of the State, and exceptional events that require a response from the State. Given that we are only talking about setting up this fund, once we have achieved our budgetary objectives I am optimistic that we will be able to make this work within the existing rules and with the support of the Commission.

Regarding the Deputy's third question, I agree with what he said. There are two different ideas: one is a contingency reserve and the other is a rainy day fund. That is something I have introduced in my discussions with my Department in recent months. I well remember, as Minister for Transport, Tourism and Sport, dealing with the flooding the Deputy referred to towards the end of 2015. Something that struck me at the time was that when we are dealing with an event in our country that, for example, stretches beyond a county or even a number of counties but affects many regions and, therefore, has a high cost across a number of Departments, inevitably it involves, in the middle of the year or whenever it happens, having to open discussions with the Department of Public Expenditure and Reform and other Departments on how we can respond quickly to something like that. I believe there should be a better way of doing that. That is the reason I am interested in the idea of this reserve fund. In terms of where it would sit, I have an open mind regarding it. I believe we could do it two ways. It could be a separate fund to the rainy day fund or, alternatively, it could be a certain level or parcel of funding within the rainy day fund that would have different access criteria.