Eoin Ó Broin (Dublin Mid West, Sinn Fein) | Oireachtas source

Mr. Morrin said EUROSTAT has indicated to the CSO that it intends to support its recommendation. Has it done that in writing? He also said the CSO expects EUROSTAT to confirm that publicly in the coming weeks. Can he confirm that? The approved housing bodies mentioned some inconsistencies between the CSO's recommendation and, for example, the similar recommendations in regard to the UK, particularly in terms of nominations off the housing list. Will the CSO witnesses comment?

For me, the aspect of the CSO's recommendations which was the least clear, although I understand it because Ms Roche very helpfully explained it to me before Christmas, was in regard to recommendation E on the risk of exposure of Government. Will the witnesses explain that in plainer English for the benefit of the committee so we fully understand it, and for the record?

I have a couple of points for Mr. Smith and Ms Murray. As it will also be relevant to the questions I ask Mr. McCarthy, I am interested to know the estimated cost of the availability agreements last year or this year from the Department of Housing, Planning and Local Government to the approved housing bodies sector, so that figure would be helpful. After the Department received the news in December of the CSO's recommendations, has it corresponded directly with EUROSTAT or the CSO to question, challenge or argue against the recommendations? Has its consideration up to this point really been what to do following the decision by EUROSTAT?

I will come back to Mr. McCarthy again when he begins to answer my questions. When we invited him here today, there were two things we were hoping he could do, and neither of those was for him to explain to us what his role is, because we understood that before he came in to us today, although his explanation was very welcome. The two things are as follows. We are trying to get our heads around the impact of redesignation of the fiscal space for this year and next year. I know Mr. McCarthy will not be able to give me fine-tuned calculations but we want a rough idea. If we start with the figure Mr. Smith mentioned, somewhere in the region of €250 million will be borrowed by approved housing bodies this year to meet the Rebuilding Ireland targets. The bulk of that is from the Housing Finance Agency but some will be from private sources. We know all of that is going to go on the debt end, and that is relatively uncontentious. However, what we are trying to understand is what would be the impact of that €250 million this year on the expenditure side of the fiscal space. My understanding - correct me if I am wrong - is that this €250 million, because it would be capital investment in the Government sector, for accounting purposes would be smoothed over the four years, so we are talking about €62.5 million of fiscal space this year. Hopefully, Ms Murray is going to give us the figure of what potentially could be netted out of that figure from the transfers from the Department of Housing, Planning and Local Government through the availability agreement to the approved housing bodies.

Am I right in thinking we are going to need somewhere below that €62.5 million of fiscal space this year? If that is the case, what are the options available to Government for dealing with that? Mr. McCarthy said we cannot use the capital investment provisions of the rules. Will he explain that? He talked about a structural reform clause. Will he explain whether that is something different? If there is an amount of fiscal space needed this year, whether it is €20 million, €40 million or €60 million, what tools are available to Government to meet that, first, on the rules side, or is it simply the case that if there is €20 million, €40 million or €60 million needed this year, the Government just has to revisit the budget decisions of October and decide that if it is going to spend that, it cannot spend something else? Notwithstanding the fact there is the increased fiscal space from 2019 in the order of €3 billion plus, as mentioned by Mr. McCarthy, if the approved housing bodies sector has to borrow the €250 million fresh each year to meet its targets, then there is an accumulative fiscal space requirement in regard to meeting the targets the Minister has said he definitely wants to meet. This year it could be €20 million, €40 million or €60 million but, next year, that doubles and it then trebles. While it might not be a huge deal this year or even next year, it is significant.

If any of what I have said is incorrect, I am looking for Mr. McCarthy to clarify it because this committee needs to have a sense of what is the quantum of fiscal space required and what are the policy options the Government has at its disposal to try to tackle that, particularly this year and next year.