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

I thank the Deputy for her question. That is a point that is often made. The Government and I consistently acknowledge that many people are under real pressure. The Minister, Deputy Donohoe, and I meet people all of the time when we are out and about doing constituency work. They share the same experiences with us as Deputy Ryan’s constituents do with her. Most people recognise that the Government has done a great deal. People can certainly hold the view that we have not done enough, but since the beginning of the past year we have brought forward €12 billion in measures to help households with the cost of living and to support businesses. This comes on the back of everything we did during Covid, which exceeded €30 billion in value. The fact that we were in a position to respond in the way we have to the consequences of war in Europe is testament to the underlying strength of the public finances. We are still, thankfully, in a position to run surpluses and to consider the kind of issues the Deputy touched upon, such as putting money away for future needs we know will arise.

There are a number of differences between the existing reserve fund, which serves a very useful purpose, and the longer term fund that the Government intends to put in place. The first difference is that the fund we will set up will have a longer term focus. The National Reserve Fund is time-limited in law and the amount that can be put into it is capped, although that can be changed by a resolution of the Dáil.

The new fund will be invested, and the investment strategy and the assets that will be part of that strategy will be the subject of consideration. We will discuss all of that over the weeks and months ahead. This is not so much a rainy day fund as much as a fund to meet the costs we know will arise. We know for sure that we have an ageing population. The demographics are changing and the cost of healthcare, pensions and home care will increase significantly. There is no dispute about any of that. We have the opportunity to put funding away to meet some of those costs. It will not meet all of them, however, and we are still going to have to make responsible decisions in the way we manage the public finances every year. The fund will be a help, and it could be a significant one. That is the essential difference between the funds.

The question on how we will be allowed to draw down and spend that money in the context of the EU fiscal rules is very good. This is a live issue. As the Deputy knows, the European Commission published new proposals today as part of the economic governance review. My officials and I will spend the next while examining the details of those proposals. One of the issues we have been very keen on is that there would be provision for what is called the control account in order that governments of countries such as Ireland that are running surpluses and are in position to put money away, will be allowed to spend that money in a manner consistent with the rules when they need to do so. We are very much alive to that issue. We will ensure that the rules reflect the position of countries like Ireland at this time.