Alice-Mary Higgins (Independent)
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That is very good. I have a final point on public expenditure. I am conscious that Germany has been pushing for a hard line on this. Indeed, it is trying to increase the 0.5% to 1%, which, for example, would almost be the equivalent of a €6 billion reduction in spending in a year in a country like Ireland. The countries that have already experienced austerity because of the requirements placed on them had a long period of privatisation. There is the issue of how much can be spent but there is also the question of how we spend and constraints on that. One of the concerns is the fact, effectively, even looking at state aid rules and so forth, that where countries have largely endorsed the idea of the state as the investor of last resort, if there are private sector actors within an area, it is made very difficult for states to invest in that area. Referring to the examples we have just given, this is even if states may in fact sometimes be more effective. Indeed, as regards housing, there have been very strong arguments that direct state investment may have been far more effective and more cost-effective.

We have a situation where certain countries that were not subject to austerity measures in the last round of fiscal rules have been able to continue delivering public investment, yet other countries are being pushed, even if the most fiscally prudent and, potentially, under debt sustainability analysis, the more effective mechanism for investment would be direct state investment. Within the discussions and negotiations, has there been discussion with regard to looking at new flexibilities, and not just at the amount that can be publicly invested but how this can happen? This is so we do not end up with a two-tier system whereby, effectively, certain countries that were not impacted by the problematic fiscal rules during the last period are able to deliver public investment, and get better value for money by doing so, whereas others are forced to move through a market mechanism, which builds in profit and so on. Is that being looked at as part of the discussion?

It sounds as if the debt sustainability analysis methodology will be key. What will the scope be for us to give input around the assumptions, be they stochastic or others that are deterministic, being input into that process?