Oireachtas Joint and Select Committees

Tuesday, 8 December 2020

Committee on Budgetary Oversight

Post-Budget Analysis: Irish Fiscal Advisory Council

Photo of Richard Boyd BarrettRichard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance) | Oireachtas source

My time is nearly up, so I might ask a couple of quick questions. A lesson we have learned from Covid is that, if we scrimp on health spending, particularly on capacity, staffing and so on, it can have more dire economic consequences in a health emergency. To a significant extent, our requirement to close down large sections of the economy was linked to the low level of capacity within our health service. That is a calculation that we must start thinking about. We might believe that we should reduce spending because it is fiscally prudent but it might suddenly catch up with us in a major way because we do not have the health capacity, thereby costing us more. Have the witnesses an opinion on reconsidering the relationship between these two matters in terms of whether it is more fiscally prudent to have the health infrastructure, which might cost more initially but save us in the long run?

In terms of reviewing our expenditure and so on, I am interested in tax expenditures and the fact that we do not examine them closely enough.

Do the witnesses believe it would be important to examine those tax expenditures closely and make a comparison? This committee and its predecessor have heard evidence from an economist - it may have been one of the witnesses, but I cannot remember - that, in general, direct expenditures tend to be better than tax expenditures. What is gained from direct expenditure is more quantifiable whereas tax expenditure is more indirect and can often be a runaway train without anyone being sure what we are getting from it.

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