Dr. Eddie Casey:

One important thing to add, and this feeds into the debate about the coming budget, is that we broadly thought that the approach that was taken in the last budget was appropriate in the sense that core spending increases and the permanent injection into the economy of extra demand from the Government's side were kept to a relatively sustainable rate. It was 6.5% or close to the 5% under the spending rule. If they had gone beyond that, there would have been the risk that inflation would be higher again and there would be more pressure there. It made sense to use an approach that drew on a sustainable increase in overall permanent spending and used some temporary measures at the time when energy prices were high. This was the appropriate thing to do. This is exactly what we are saying to do when we look at budget 2024. This is why this kind of approach is so important and why it helped last time.