Bernard Durkan (Kildare North, Fine Gael) | Oireachtas source

I thank our guests for their interventions. I am a little bit of a pessimist in this regard. I raised this question numerous times in the run up to the financial collapse. Our guests might not have read the Official Report, but I raised this question time and again. We were cautioned not to raise it lest it cause a run on the currency, on investment or on confidence. I felt that we were heading towards a disaster, so I asked whether the fundamentals of the economy were on a safe footing. That was the only way I could get around the scares. I got one good answer that told me "No", and then the whole thing fell down. Everything was denied afterwards and we know what happened.

House prices are a major contributor to inflation and have been for some considerable time. They will ultimately be a contributor to demands for higher wages, at which point the spiral will take off. I am willing to be convinced that current inflation will only last for a short duration and we will see a reduction during the second quarter of 2022, but if it does not happen that way, we could be in for a shock. Some means will have to be found to arrest the trend in inflation.

Professor J. K. Galbraith used to say that, if we stimulated the economy, we would inevitably need to introduce price controls in order not to contribute to inflation. That is laughable to everyone nowadays, but we had price controls in the 1970s and 1980s because we needed to. There was no other mechanism available and inflation took off along a serious tangent. Our guests will remember how bank interest rates eventually increased to 17% or 18%. I remember dealing with people who were charged 25% penalty rates and so forth. At that stage, nothing could happen and the economy was in a downward spiral. I hope that does not happen again.

I will pose a question, but never mind "on the one hand and on the other hand". Let us take both hands out of this, put them up and say what we can do now to arrest this inflation before it gets too serious without permanently damaging the economy and causing a slump. That is my first question. I would be happy for anyone to take it.