Professor Michael McMahon:

I am going to use the term that Deputy Doherty disagrees with. Is the spending rule a perfect rule and should we use the exact precise figure of 5%? It is a very reasonable amount over the medium term. Therefore, at the very least we would advise the Government to stick within that rule. That involves making choices. As we stated already, it does not mean that the Government cannot support pensioners, public sector workers, those on the lowest incomes and those on fixed incomes. It is possible to support all of those groups within the rule, but you then have to make offsetting decisions elsewhere which might mean less of a tax package, a targeted tax increase or spending cuts in areas where we do not think we are getting high value for money. These are decisions for the Government to make, but it can make those decisions in the budget and on aggregate help avoid the risk of repeating past mistakes.