Alice-Mary Higgins (Independent) | Oireachtas source

Housing is an example of public investment, but it is routed through a short-term mechanism in terms of leasing. Under Housing for All, quite large amounts of money are being directed towards a leasing model. It has been well documented that a flood of investors are seeking to capitalise on the 25-year social housing contracts that are more costly to the State in the medium to longer term. While inflation is increasing generally, housing inflation is out of synch. Can Mr. Barnes comment on that?

Adding income disparity as a potential medium-term challenge was mentioned. Could Mr. Barnes discuss the importance of measures that seek to address not just the redistribution of social protection but also the cost-of-living measures that may be introduced and the need for measures to target those at the bottom tier? A medium-term piece on income disparity was mentioned. Could he address housing, which is both an immediate and medium-term issue, and the specific issues of leasing and additional costs? I ask him to address the inclusion of profit margins as an additional cost to the State and the creation of inflationary pressure. For example, increased social housing on a not-for-profit basis might have a deflationary effect.

I wanted to pick up on two of the three medium-term challenges Mr. Barnes identified. He mentioned the pensions commission report. There is a real problem with it in that it explicitly excluded one of the largest forms of expenditure on pensions in the State from its discussions. In terms of fiscal planning for pensions and treating that within a closed loop of PRSI when we have another strand of public expenditure, namely, tax relief on private pensions, that does not seem to have been taken on board and properly considered. A few years ago, we spent €2.7 billion on private pension tax relief. Research has shown that the money is largely going to those persons in the higher and ever-growing income strata that were mentioned. Surely fiscal prudence would involve examining the tax expenditure on pensions, as well as PRSI, when we configure how we plan prudently for a pension for everybody in the State.

Carbon targets have been factored in in terms of expenditure. It is a question we as a committee raised with the EU Commissioner for Budget and Administration. Sustainability was mentioned. Fiscal sustainability needs to be understood within the sustainable development goals and the wider frame of sustainability. We are working within very set planetary thresholds. Our fiscal and financial policies are, to a degree negotiable, but they are sitting inside a non-negotiable planetary boundary in terms of the available emissions space and our carbon budgets. I ask Mr. Barnes to comment not just on the idea of expenditure on climate and environment policies but also on the proofing of our fiscal policies to ensure that they are sitting within a very rigid carbon budget. I am aware that this is a discussion at EU and global level, as well as in Ireland.

I ask him to comment on housing, in particular the fiscal prudence of targeted measures towards lower incomes. The IMF has said targeted measures towards those on lower income tend to stay within the economy and have a less inflationary effect, in that such money tends to go on basic expendables. In terms of preventative spending, the health impacts, for example, of cost of living issues at a lower income level can be very negative, such as people going hungry.