Paschal Donohoe (Dublin Central, Fine Gael)
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Of course, I have very carefully studied the assessment report of the Irish Fiscal Advisory Council. In each of the other two budgets in which I was involved as Minister for Public Expenditure and Reform, the council did not raise issues of the kind it raised in the most recent report. That is one of the reasons I take what it has stated so seriously. I do not dismiss the views of the IFAC in any way. The Government and I need to take on board its analysis when moving into this year. I have not yet responded to the council but will do so in the coming days. The response will be in line with my remarks to the committee today. When I issue the letter, I will forward it to the committee as a follow-up on this meeting and it will be available on the website of my Department.

On the comments of the Minister, Deputy Regina Doherty, there is always an anticipation of and a need to fund a Christmas bonus. One issue I must consider is how any new funding method which the Government may believe necessary can be factored into our budgetary calculations. I look forward to discussing with the Minister how that could be done.

I completely understand the Deputy's point in regard to the Public Health (Alcohol) Act. I am more familiar than he might think with how supply chains work in the retail business. I understand how wholesale operators work and their ability to source any products, particularly alcohol, from multiple locations. I know what the grey market is. I assure Deputies that my involvement in it was always legal but I understand how it works because of my career before moving into politics. I know that a change in an indirect tax can have a far greater effect than is commonly understood and does not solely affect the tax base within this jurisdiction. I am aware of the comments of the Minister, Deputy Harris, on the Public Health (Alcohol) Act. The triggering of its provisions is a decision for him. I respect what he said. In the run-up to that decision, I will discuss the potential consequences with all members of the Government because everybody needs to be aware that there may be consequences if the price of a key wholesale good moves out of line with that in other markets with which we are integrated. This is an issue to which I will return.

On carbon tax, the situation highlighted by the Deputy underpins part of the reason why I did not move on carbon taxation in the budget. In the second half of 2018 there was neither a consensus nor an understanding on what a move on carbon taxation meant or its many consequences. I understand there is a need to raise carbon taxes and want to see how we can do so. Those who advocate for an increase need to be more clear on its various consequences. If our carbon taxation was out of line with that in other jurisdictions, it would change the costs of things that are very important to people's standard of living and would have an effect on other things within our economy, as indicated by the issue raised by the Deputy. That said, for many reasons we need to try to build a model for steadily changing carbon taxation and to indicate to citizens and investors that the price of carbon will rise in the medium run.

That will be a challenging piece of work for this year.