Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

The Deputy has homed in on the available resources for new initiatives and new measures. Core spending will increase by €5.7 billion. That is the scale of the overall package. There is some rebalancing in that we are now bringing approximately €700 million of that forward into the current year in the event the public service pay deal is ratified. However, it is still a €5 billion increase in core expenditure for next year. The fact that a large share of it is already accounted for is because of decisions we have already made, including to prioritise a public capital investment programme and to have a national development plan, NDP, envelope next year of approximately €12 billion. That is a very conscious, deliberate decision by the Government that will do many good things throughout the country, in building schools, healthcare facilities, public transport, roads and so on.

It is also a function of the fact that the level of inflation we have means delivering public services has become more expensive, as I said. That envelope for protecting existing levels of service, ELS, has become more expensive. That is just the reality of the environment we are in, which then shrinks the envelope I have for new initiatives. That is a fact and a constraint. There is always a constraint on budget day. We will use those resources to the very best of our ability but we have to make decisions in the context of the overall picture, which is that core spending will grow by more than 6% next year. We believe that puts us within safe parameters. We have made a temporary adjustment to the spending rule. That has been endorsed by the Irish Fiscal Advisory Council, IFAC,-----