Dr. Mark Cassidy:

In relation to capital spending, as Deputy Aindrias Moynihan will be aware, the recently announced national development plan, which is extremely ambitious, commits to investment of €160 billion in the period between now and 2030. It is a welcome opportunity to address the infrastructure deficit in this country to increase housing supply and to meet our climate change targets.

The concern the Deputy is alluding to is a very real one and involves a significant sharp increase in the rate of capital spending. The concern there is that the additional demand feeds through to higher prices as opposed to what you are trying to achieve. That is something that needs to be monitored. The timing or phasing in of the plan currently seems appropriate. If you were to see excess inflationary pressures, if you were to see private sector construction, for example, being squeezed out by the extension of public sector, then you may need to look at the phasing or timing of some of that delivery but that is not something that we are projecting or forecasting at present. However, it will be necessary to attract more labour into the sector. It is necessary to look at the productivity of the construction sector, particularly to ensure that we are getting value for money and the economy can control the costs of these massive infrastructure projects. If that can be achieved, this will have a very welcome effect on the productive capacity of the economy and some of the societal needs in terms of housing and infrastructure.

Deputy Aindrias Moynihan also mentioned wages and referred to some sectors. I would say the Deputy is absolutely right. The Deputy identified some of the sectors where wages are increasing quite rapidly at present. We can identify those sectors as the ones which are experiencing the tightest labour market conditions and finding it most difficult to attract workers. What we are not seeing yet is that becoming generalised across the economy. At present, high wage increases are in a few fast-growing sectors - the Deputy mentioned information technology, IT, and construction, and there is also financial business services - rather than across all parts of the economy.