Professor Michael McMahon:

I am going to disappoint the Deputy partly at least, as I usually do with my answers. What he is describing are preferences over certain targeting or non-targeting of specific policies, which we do not comment on. That is not in our mandate and we try to do what we are asked.

I will try to disappoint the Deputy a little less with my next comment. Inflation hurts everyone. That is one of the points that used to be hard to teach, when I was teaching, because most people had lived most of their lives in an era of relatively slow and stable inflation where they had not had to think about it. The past two years has clearly changed that. Everybody is being hurt but, within that, there are distributional differences in regard to who is or is not affected.

To go back to the answer I gave in response to Deputy Conway-Walsh, decisions can be made within the net national spending rule that would allow policies such as Deputy Boyd Barrett was prescribing, which I am not endorsing or otherwise - that is for politicians to decide - but the sum allowable in new net core spending under the Government's net national spending rule is €4.3 billion. We estimate that the cost of standing still also happens to be, completely by chance, €4.3 billion, but if we did not make some of the extra windfall investment or introduce some of the tax package, we could maintain the real value of public services, increase some wages in line with inflation and increase pension costs and other transfers in line with inflation. That is doable. If we wanted to go beyond that, we could take revenue-raising measures and that would give us more scope. Nothing in our report takes those types of policies off the table.

One other point, which I think we have made many times in the past, so I am not overstepping the mark, is that a question that should often be asked of these types of policies relates to how well targeted they are. If we have identified a subset of the population who deserve extra support, whether that is geographically based, income based or based on some other decision rule, the best use of public funds to help them is one that is targeted rather than saying we need to help those people and that, therefore, we will just take a blanket measure where most of the benefit goes to someone else.

That is a big discussion that should reign over a lot of Government policy. I am trying to say this in language that does not express a preference for one set of policies or another so as not to overstep the mark. That is a reasonable discussion of fiscal policy. How targeted should it be and who are we trying to help? To go back to the answer I gave to Deputy Conway-Walsh, all of these types of policies are permissible under a net national spending rule; it is just that they involve choices. It is for the political system to make those choices when the time comes to make them. I hope I did not disappoint Deputy Boyd Barrett too much.