Mr. Stephen McDonagh:

I will start with Deputy Casey's question on debt, which will lead me to Deputy Ó Broin's query. We present the debt in the medium-term forecasts. It is presented in nominal terms and we also provide the ratio of debt to GDP, which is the requirement under the Stability and Growth Pact requirement. We also provide information on the ratio of debt to GNI*, given the limitations of GDP in an Irish context.

Simply put, we collect the amounts directly from the bodies involved, in this case the AHBs. We ask them to differentiate how much they are borrowing from local authorities, the Housing Finance Agency, HFA, and third parties, that is, non-government bodies. The latter is the part that adds to general Government debt. The HFA, local authorities and any other Government borrowings are already captured elsewhere in the system. Consolidating these figures provides the figure of €100 million, which the approved housing bodies currently report is provided to them by the Department of Finance.

That leads me on to the question of how that links up with capital financing. The two issues are somewhat separate when the fiscal space is calculated. The debt is the debt. That is what we borrow. The relevant question is when it is spent. When it is spent we do not link it to the source of the financing, although obviously the financing provides the space to spend. When it is spent we determine whether it is current expenditure or capital expenditure in this fiscal context. As has been said, if approved housing bodies borrow €100 million from private capital, that would logically give them €100 million to spend. It is a question of the timing of that spending and whether it took place in one year, in other words, what is the relative change in the expenditure. Assuming that the primary engagement of AHBs is in the area of delivering capital, it is most likely to lead to additional capital expenditure. We determine the amount of additional spending in the area of capital and then apply quarterly smoothing to that. I hope that addresses the questions. I appreciate it is somewhat vague, but as members will be aware-----