Mr. Sebastian Barnes:

I will answer two of the questions and leave the others to my colleagues. Deputy Broughan asked about spending and the term "spending drift". The fact that spending is increasing is a good thing, in most cases. The economy is growing and that is good news because that generates resources which, in turn, pay for increased spending in some of the areas mentioned. Spending is not necessarily a bad thing. We believe that spending in the good times should grow at a steady pace and in the bad times should grow at that same steady pace, such that we do not have a boom and bust in public spending for some of the reasons outlined by my colleagues. A rainy day fund allows us to smooth this out. As tax revenue goes up and down we want spending to grow slowly and sustainably to build the type of economy which I am sure members want.

Spending drift, however, is a different concept. Spending drift is about money that comes in unexpectedly and how it is managed. Over the past couple of years we have had favourable tail winds, some on the tax side, some on the corporation tax side and some in the form of lower interest payments, but this money has been spent. Money that comes in that was unexpected is usually money that is less likely to be sustainable. It is sensible to be prudent about this money and to save and ensure that it is available for the future. The concern is around spending drift in regard to new money that comes in unexpectedly, over and above the fact that it was anticipated that the economy would grow. This is very relevant in the context of budget decisions. If by the autumn unexpected additional tax revenues over and above the strong growth that is already factored into the Government's forecasts appear this yield should be saved because there is a big chance it will be a transitory and unsustainable. That that spending is rising in general is encouraging. We are arguing for decisions to be made that will help to sustain that but the spending drift of spending money just because it is there is bad economically and it is risky as well.