Oireachtas Joint and Select Committees

Wednesday, 22 September 2021

Committee on Budgetary Oversight

Pre-Budget 2022 Scrutiny: Irish Fiscal Advisory Council

Mr. Sebastian Barnes:

In terms of the national development plan and the question of doing an explicit review of it, I do not think that is within our mandate and, obviously, there are many issues in there that are much more microeconomic than the ones the council deals with. However, it will be an input to our fiscal assessment report and our assessment of the fiscal stance. It will be important to understanding the economic forecasts, the budgetary forecasts and then our overall view of the public finances. Whether the national development plan provides us with comfort, as the Deputy suggested, or not will very much depend on what it says. That is why it is a very important input for our sense of the public finances.

One of the big questions we discussed earlier was what the Government's own view of the normalisation is. I do not think it is for us to say. There is little doubt that public investment will be higher on average in the future than it was if we go back a couple of years. To what level it should normalise, I do not really know, but it would be good to know what the Government’s view of that is. The specific question of whether the normalisation ends in 2026 or how the Government is going to unwind this is an important issue because it is a big factor pushing on the economy. That is a big part of the information we are looking for. It is about the composition and it is about the economics of it as well. At the moment, we do not really have that information and it is legitimate that that should be in the national development plan.


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