Eoghan Murphy (Dublin Bay South, Fine Gael) | Oireachtas source

The summer economic statement is an important stage in a new enhanced budgetary process. The Government's engagement with the Oireachtas is key to that. The summer economic statement will be followed by the national economic dialogue next week. We will then move into the mid-term review into the tax strategy papers. This will be followed by the budget, which will be followed by the relevant legislation. We will then deal with the Revised Estimates process and prepare for the next stability programme update. We are looking at an all-of-year cycle, with constant scrutiny of the numbers. The latter is an important development, particularly when one has new resources coming into play in the form of a new budget oversight committee, which is being scoped at present, and a new independent budget oversight office, which will come into being next year. With these new resources, we hope to have better debate and analysis and, as a result, better decision making by Government. That was not there in the past when we needed it. It is a crucial development that will require more work from all of us in this House.

The rainy day fund is about prudent management of any surplus income coming into the economy in the years ahead as the economy continues to grow. The Minister for Finance has outlined his intentions to engage with the Oireachtas as to how this rainy day fund might work, when it would be deployed and on what terms, the authorisation mechanisms and whether there would be partner funds working in co-operation with that fund. I know we previously had the National Pensions Reserve Fund which built up an important reserve but, unfortunately, that had been deployed almost wholly in one big bang so it was less of a rainy day fund than something to deal with the economic earthquake we experienced. What we are talking about in terms of building up a rainy day fund when resources are available is making those small but important interventions into the economic cycle in a counter-cyclical manner to help a smooth and adjusted path for growth and to do that in a focused way without having to wait for those major events when the fund would then have to be deployed, as happened in the past. What we hope to get from this new economic cycle, the summer economic statement, the new budget office and the new budget oversight committee is that those interventions will not be necessary in the future and that, through the new oversight of the numbers and the new work we are doing, we will be able to continue to grow the economy in a sustainable and balanced way. That is very important. Nonetheless, prudence requires a rainy day fund to make those small interventions where they may be necessary in the future.

What underpins all of this, the summer economic statement and the debate that is about to begin in respect of the fiscal space and our priorities as a Government, which reflect the priorities of the people, is the increase in jobs. It is the reason why we are in this space and are able to do this. This increase is thanks in no small part to the activities of many businesses and small and medium-sized enterprises and the great work they have done to increase employment. It is also thanks to foreign direct investment that much work has been done to shepherd and keep it in the country and the job creation that comes from that. Many of these measures are underpinned by the Action Plan for Jobs introduced by the previous Government and the great gains it made in the past and continues to make today.

The growth in jobs has allowed people to get back to work and make a positive contribution to the economy. I know that when we have these debates and people look for extra resources, they often talk about increasing taxation. If we want to increase revenue to the Government for spending on public services, however, the best way to do so is through activity, productivity and getting people back to work. As a result of getting people back to work, apart from the very tangible benefit for them in their personal, family and community lives, there have been extra resources for the Exchequer. This has allowed us to close the deficit, reduce the debt, increase spending gradually and prudently and make targeted reductions in taxation for those on low and middle incomes. As this happens, it creates a better environment for further job creation and the benefits come again from that. It is important that we can continue the momentum that exists in the context of creating jobs.

The reason we focus on the numbers, which can sometimes seem cold, is because in focusing on the numbers and these headline targets like job creation and deficit reduction, it brings us into the space where we are today where we can focus on the needs of the Irish people and the opportunities for the country in the years ahead. The choice comes down to us, as a Government, working with the Oireachtas as to how best to deploy our resources so that people can benefit from the sacrifices that everyone has made through the difficult years following the financial crisis. This is what the summer economic statement is about. It is about getting that dialogue going about what our choices are as a Government and as a Parliament.

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