Marie Sherlock (Labour) | Oireachtas source

I apologise to our guests for my going in and out. We have had votes in the Seanad on the mica Bill. I also apologise for any repetition in case my questions have already been asked.

Enormous credit is due to the council for the work it has undertaken since it was established. It has been very important in adding to the understanding of the fiscal position in the country. I found this in my former life, but I also find it now. IFAC has done some really important work, and I want to acknowledge that.

While I am conscious that much of the council's work relates to the fiscal position, I am particularly interested in the distributional impact of any policy. Take the budget that is being proposed now. It will be a very sizable budget by any standard. The key issue is what it will deliver for various people. I am looking at the tax package. Mr. Barnes's opening statement contained a very carefully-worded paragraph about the tax package and how inflation effectively draws more income into higher tax bands. We have seen a fiscal drag with the tax bands for many years. You would have to have an enormous increase in the standard rate of tax threshold to bring it up to the average earnings. In September, there is likely to be just over €1 billion in a tax package on offer. The Government has said that it will widen the tax bands. If it does so by about €1,500, an average worker will get about €5.60 more per week. My question is about the macroeconomic impact of that but also the distributional impact. What is IFAC's view of the effectiveness of spending money on putting €5 in a lot of people's pockets compared with an alternative source of spending? What would be the macroeconomic impact? Has IFAC done an analysis of that? What is its view of the fiscal and distributive impact of increasing the tax bands?