Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I thank the Deputy for his question. He has rightly highlighted what will be one of the main legacies of the Covid crisis, that is, a significantly elevated level of public debt from a pre-Covid level of around €200 billion, rising to around €280 billion by 2025. I would make the point that despite that significant increase in public debt, the cost of servicing that debt has fallen. The annual interest bill stands at around €3.5 billion per annum, which is significantly below where it was projected to be because of the historic low interest rates. The average interest rate across the portfolio is of the order of 1.6%. The National Treasury Management Agency, NTMA, has done an enormous amount of work to reprofile the Irish debt to take maximum advantage of the benign borrowing conditions that are there and which will not remain in place indefinitely.

As the Deputy will see on page 28 of the document in figure 16a, the interest to revenue ratio has fallen considerably over recent years. If the Deputy looks at page 27, table 3, the ratio of debt as a percentage of GNI* remains quite steady and falls modestly over the period. All of this underlines the importance of this framework and of Government agreeing to and sticking to it over the next number of years because it is undoubtedly the case that the scale of the increase in the nominal debt increases risk. It is not risk free so we have to ensure that we remain within this framework, meet the milestones within it, make steady progress in unwinding the Covid related expenditure, support the economic recovery and reduce the deficit in a gradual way in line with the forecast we have set out.