Simon Coveney (Cork South Central, Fine Gael)

I am glad to speak in this debate, although it is frustrating that I only have seven minutes. I will endeavour to try to make some points which I hope will hit home with the Deputies opposite. Everyone in this House accepts Ireland is on an unsustainable path as unemployment continues to increase and businesses find the going tougher. Ireland spends approximately €55 million per day more than it earns and we need to borrow the difference. Currently, we are surviving on reserves because of money we borrowed earlier in the year and, potentially, the reserves in the National Pensions Reserve Fund, which will not last forever.

Everybody recognises Ireland will need to go back to the bond markets in the first quarter of next year, as the Department Finance has confirmed, to borrow money, regardless of the level of cutbacks in the first of four tough budgets. I find it extraordinary that nobody from the Government side dealt with the key issue in regard to our capacity and ability to borrow from the bond markets next year. My understanding from the briefing from the Department of Finance is that the key requirement from bond markets to allow Ireland to issue bonds is that we will need to bring our deficit below 10% of GDP next year from our current position. No Government speaker, including the Taoiseach and the Minister for Finance, addressed that issue as to what figure will be necessary in the 2011 budget to bring down the deficit to 10% or less of GDP. That is the guideline figure we have been given to issue bonds and raise money in order that we can keep Ireland functioning and keep our economic and political independence in terms of budgetary decision-making. Nobody on the Government side addressed that point and perhaps Ministers who will speak later in the debate will do so.

There must be a twin track approach, about which many Deputies, including Government Ministers and Deputies, have spoken. We need to bring our deficit down and the Government has set itself a figure of €15 billion over four budgets, but we do not agree with that yet because we do not have the full figures, in particular the growth figures. However, we agree that by 2014, we need to get the deficit down to 3%, or less, of GDP. Time will tell whether €15 billion will be enough or perhaps too much. Fine Gael will make its position clear well in advance of the budget. However, at the same time, there can be no future with optimism in Ireland unless we can get growth into the economy as we are dealing with structural deficit problems which are the result of insane Government policy over a number of years.

I wish to comment on some recent Government policy. There are two problems here - first, there is the policy itself and, second, there is the execution of policy which is an even greater problem. Even when the Government gets something right in principle, the execution of that policy is incompetent, inefficient or does not meet targets. I refer to the Croke Park agreement, for example. In principle, it was a good idea to get agreement among unions and employers to try to bring stability in a time of recession. What has happened? Six months later there has been no delivery. The Government still cannot give the Opposition a figure on how much it estimates it will save by public sector reform next year.

I refer to NAMA. The principles behind it made some sense, although there were problems. It required the banks to crystalise their losses and their bad lending. It was to provide capital to banks in order that we could get liquidity back into small business and so on. What has happened? There has been an absolute freeze on liquidity. Banks are being financed on a week-to-week basis by the lender of last resort in Europe, the European Central Bank. They do not even have money to lend, never mind a willingness to take risks again and lend money to the marketplace. That is largely because of NAMA which, we were told at the start, would attach a hope value to certain properties. It is now undervaluing properties so that it can get headlines such as those in the past week stating that it is making a profit of €130 million on a property that it acquired from Anglo Irish Bank. Such news is not a win for the country. It means that the bank has crystalised an even bigger loss that taxpayers need to bail out because we own Anglo Irish Bank. Either way, the taxpayer is losing.

On deficit reduction policies, Ministers, one after the other, have complimented themselves on the great achievement of reducing the deficit by €14.5 billion over the past two and a half years. I would like to check the figures.

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