Mr. Seamus Coffey:

Overheating is a broad concept for the economy. Increasing public capital spending will not, in itself, lead to overheating in the economy. One looks at the entire spectrum of activity that is occurring. If the ramping up of public capital spending was to be associated with a rapid rise in private construction, particularly in residential development, and we were to see consumption rise rapidly, the economy would begin to perform beyond its potential. This is a scenario with which we are familiar. Ten years ago, we were at a level of economic activity that was not sustainable. We would prefer, in circumstances where we find that certain elements of the economy may be performing above sustainable levels, to cut back elsewhere by introducing offsetting measures that will ensure overall activity in the economy is placed on a sustainable footing. We would not view increasing public capital spending on its own as a danger. It is about taking a broad approach. On the issue of overheating, we try to look across a range of measures to identify problems, hopefully before or as they emerge, and then put in place measures to offset them. On its own, public capital spending will not lead to problems.