Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

There is no doubt that there has been an improvement in many of the issues we argued in the referendum, structural balance, the hard rules, and the 120 have all been proven correct over time. The suspension of the rules at a time of vulnerability shows that these hard and fast rules should not be in domestic law, in my view. We are getting to a better position but there is still some clarity required and issues to be teased out. My two final questions go back to the spending rules. The rules, as we understand them, and as they are being presented will not apply to Ireland at this point in time because we are not in deficit, we are in surplus and expect that surplus to grow over the medium term and our debt to GDP ratio is below 60%. Even if debt to GNI* was used by 2026 this ratio will be at 65%. I think net debt to GNI* will be as low as 45% so Ireland is on a very good trajectory as regards our debt. While some people talk about the quantum of debt it is coming down and our ratios are dropping very quickly, which is to be welcomed. Is it Mr. Barnes's understanding that the rule will not apply, will they be advisory or will there still be implications to these rules even through Ireland is not in breach of the 3% or the 60% rules? Could there still be some encroachment or infringement either by the Irish Fiscal Advisory Council in terms of its enhanced powers - and I hear its call for the additional resources that will be needed to support its work - or through the European Commission?

The second part of my question goes back to the national spending rule. We are so conscious of that and in fairness the Irish Fiscal Advisory Council played a leading role in pointing out the vulnerability of the windfall corporation taxes which have now grown to approximately €12 billion. Even when we set those windfalls aside the State is expected to be in surplus, and significant surplus next year and over the next number of years, growing from €4.4 billion to more than €8 billion. When we compare Ireland's expenditure to other European countries it is low in comparison. I was looking at Germany's general government expenditure to GDP ratio which was 51.3%; Denmark's was 50.8%; and France's was 59%. Ireland's expenditure to GDP ratio stood at 24.8%. We all know about GDP so adjusting for GNI* it is 45.2%. These other countries are 59% or 51%. We are significantly behind and if people want their health service fixed, or they do not want a situation where a 98 year-old woman has to look at emergency hostel accommodation, we need to get more in line with our European competitors. Does the Irish Fiscal Advisory Council have any concern that a 5% rule at a time when there are surpluses that are expected to recur to the tune of billions would limit the ability of the State to meet the needs of citizens? One tail to that is the golden rule is gone and this is a major issue that all European countries will face in terms of the required transition that will cost a lot of investment. If we look at the budget for next year, outside of existing level of service, ELS, we are talking about €1.8 billion. It is not a huge amount of money when we look at the tax package and some of the pressures so does the Irish Fiscal Advisory Council have a view on whether there should be a carve-out for the likes of expenditure on transitionary measures in terms of climate change?