Alan Shatter (Dublin South, Fine Gael) | Oireachtas source

I am responding on behalf of the Minister for Finance, Deputy Noonan, who is away on European Union business of importance to the State.

We have had a constructive debate on the importance of this Fiscal Responsibility Bill which will implement key provisions of the stability treaty, as voted for by the Irish people. The Fiscal Responsibility Bill will implement the fiscal rules in the stability treaty. These rules are sensible and prudent and represent a responsible approach to budgeting.

The debate over the last few days has raised a number of issues, proposals and queries that I would like to take this opportunity to respond to.

I welcome the support of Deputy Michael McGrath and his party for the Bill, and note that he may be bringing forward amendments on Committee Stage on the appointment of fiscal council members.

The views expressed by Deputy Pearse Doherty mirrored the arguments put forward by him and his party during the fiscal stability treaty referendum. However, the Irish people considered all the arguments and supported the treaty and, as the Minister, Deputy Noonan, already stated, the purpose of this Bill is to implement the stability treaty.

Deputies Pearse Doherty and McDonald also criticised what they see as the narrow mandate of the fiscal council, particularly the lack of a remit to consider the social impact of its fiscal policy recommendations. This is the function of Government. Furthermore, there are a number of bodies supported by the State, such as the ESRI and the National Economic and Social Council, the reports of which consider all aspects of policy development, including social impacts.

Some Deputies suggested some changes be made to how the fiscal council prepares its reports, and its profile. I remind Deputies that an objective of this legislation is to put the council on a statutory basis, and also to ensure its independence. Therefore, the style and content of the fiscal council reports is a matter for the council but I am sure it is aware of those comments.

With regard to Deputy Pearse Doherty's wish that Government should be required to respond to all of the council's recommendations, I want to point out that we have responded to the council's previous reports in the Medium-Term Fiscal Statement in November last and in the stability programme update in April last. The Medium-Term Fiscal Statement later this month will respond to the council's latest fiscal assessment and it is the Minister for Finance's intention to continue this practice.

There were some comments by Deputies which suggest some confusion about the debt rule. I remind Deputies that the debt rule specifies that when the level of general Government debt exceeds 60% of GDP, the Government must reduce the debt by one twentieth of the difference between that level and 60% - not one twentieth of the whole debt.

With regard to the comments about a solution for our banking debt, discussions are ongoing between Ireland, the ECB and other members of the troika. ECB President Draghi said the ECB "is cooperating with the Irish Government in trying to find a solution" to this issue.

The ECB President also reiterated the remarks of the Taoiseach, the EU Commission, the President of the European Council, and the President of the European Parliament that the Council agreement of 29 June stood. That agreement stands and it is important in the context of the integrity of European Union, relationships between member states and Heads of State, that agreements entered into are fully complied with and implemented and that there be no doubt about that. The discussions taking place are complex and we are focused on delivering the best deal for the Irish taxpayer.

A number of Deputies criticised the Bill as being a charter for continued austerity and therefore not sustainable. What is not sustainable is the prospect of continuing to borrow approximately €1.5 billion each and every month. The recent improvements in market sentiment towards Ireland, as evidenced by much improved secondary bond yields, stem from the fact that we are delivering on our commitments, returning the economy to growth and reducing the deficit in the public finances. Enacting this Bill, ratifying the stability treaty and implementing our fiscal policy in compliance with the Bill are further steps on this path. Any alternative path would be irresponsible. Ireland is committed to returning our public finances to sustainable levels by 2015. This is designed to ensure long-term economic growth, instil investor confidence and bring down the cost of debt which has to be serviced by Irish taxpayers. This strategy has shown recent signs of success with the significant lowering of bond yields since early summer and the successful return of the NTMA to the debt market.

Of course, listening to Deputy Shane Ross on his usual soap box, one would think that no improvement has taken place and no advances of any description have been achieved. Deputy Ross, who is now indistinguishable in his political views from Deputies Joe Higgins and Richard Boyd Barrett, is essentially opposed to everything and recognises no good in anything.

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