Oireachtas Joint and Select Committees

Wednesday, 10 May 2023

Joint Oireachtas Committee on Finance, Public Expenditure and Reform, and Taoiseach

Examination of EU Fiscal Rules (Resumed): Irish Fiscal Advisory Council

Photo of Pearse DohertyPearse Doherty (Donegal, Sinn Fein) | Oireachtas source

With regard to risks and concerns about the future, and pensions is a good example, I would not expect anything less of the Irish Fiscal Advisory Council than to produce the type of papers it has produced. They are very helpful for the debate. I make this point because it is a specific call for national legislation that is outside the EU fiscal rules and would create a further bind. We will move on from this.

With regard to the Commission's proposals, it has resurrected the 3% deficit and 60% debt targets as part of the new rules, with member states required to have a fiscal adjustment of 0.5% of GDP if their deficit remains above 3%. Will Mr. Barnes outline his understanding of why a debt target of 60% of GDP should be considered appropriate? Is it an arbitrary target? We have heard from other witnesses that 60% was chosen because it was the average of European countries at the time but there is no basis in analysis as to whether it is an appropriate figure. Is there a basis for the 60%? Is it appropriate?

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