Pearse Doherty (Donegal South West, Sinn Fein)
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I agree with the amendment. It provides that the Minister would be obliged to respond whether the Government agreed or disagreed with the assessment made under subsection (3). My amendment, No. 16, goes further than that. This is a weakness in the Bill and, although the formula of words could be re-examined on Report Stage, it is important that an amendment such as this is included. Under the legislation the fiscal advisory council has two primary roles. One is to deal with the rules that stem from the treaty, which are in subsection (3) relating to exceptional circumstances, the failure referred to in section 6(1) and compliance with the budgetary rule. Subsection (3) is basically what comes from the treaty. Subsection (4) outlines its other role, which to provide an assessment of the fiscal forecast in respect of the budget and stability programme, the fiscal stance year by year and whether it is conducive to prudent economic and budgetary stability, including the references to the provisions in the Stability and Growth Pact. That is crucial.

Hopefully, section 3 will not arise. I hope we will not be in a situation where there are issues relating to compliance with the budgetary rule and that we will have growth and are able to deal with this. The fiscal council's reports so far have been dealing with the budgetary issue and the stability programme. When I raised this on Second Stage the Minister mentioned that a response to the fiscal advisory council reports is given in the stability programme update that was released in February. He is correct. I looked at the stability programme update, and chapter 3.6 is on the report of the Irish Fiscal Advisory Council. The bulk of the chapter outlines what the fiscal advisory council has told us. That is not a response; it summarises some of its findings. Then there are two small paragraphs which detail the Department's response. The response is printed in red ink.

The document prepared by the Irish Fiscal Advisory Council - its second report - was 64 pages long. It was hugely detailed and contained a great deal of information. We all do not agree with the recommendations, but we all gave them a fair hearing and asked questions of the council's members when they appeared before the committee. There were 64 pages of detailed analysis and recommendations but the Department responded with 185 words. It is not right that this is the type of attitude is shown to the fiscal advisory council. I know the Minister and his officials hold the council in huge esteem, but this is something we must get right. When Professor John McHale appeared before the committee recently I asked him about the reporting of the council and his view of the Government's response. He said:

Deputy Pearse Doherty inquired as to why we changed the advice we were giving since our first report. In the context of how the Government formally responded to our advice, the stability programme update contained a short response. We would perhaps like a more lengthy response. It is very important that the Government does not feel that it needs to respond immediately to what we say - sometimes such responses can come a little too quickly - but that it should take the advice on board and then provided a more considered reaction in an appropriate way.

An appropriate reaction in a considered way is not 185 words in the stability programme update in response to 64 pages of analysis and recommendations from the advisory council.

The amendment places the onus on the Government to lay before the Houses of the Oireachtas its reasons for not accepting the council's advice, not just regarding what stems from the treaty but also the advice it gives on the budgetary and stability programme, official forecasts and whether it is conducive to prudent economic and budgetary management, including references to the Stability and Growth Pact. This is important. As I said, the amendment could be tweaked because perhaps two months could be too restrictive - obviously the Minister does not wish to show his hand prior to a budget - but it is important that the requirement for a formal response is set down in legislation, and more than what is contained in the stability programme update.

The second issue relates to instances in which the advice of the fiscal advisory council is not heeded by the Department. As we have already outlined, what is contained in the Bill is that it would only apply under section 3. When it is not heeded it should be laid before the Houses and there should be a debate or statements on it. If we are establishing a fiscal advisory council on a statutory footing to give us independent advice - I am not saying we should take that advice all the time and just implement it - the advice merits statements in the Dáil, at least, particularly if it is on section 3, which deals with non-compliance with the rules of the treaty.