Joan Burton (Dublin West, Labour) | Oireachtas source

The Fine Gael Party has been working overtime to rebuild its rather tattered reputation for fiscal prudence and economic competence. This summer economic statement meets neither of those requirements, unfortunately. In fact, rather like last year's summer economic statement, this statement is seeking to present the best possible aspect of the situation we are in. The situation, however, is outside the competence and control of the Minister at the moment because of Brexit and it poses serious challenges to Ireland.

We do not know whether Ireland is going to get lucky and there will be some form of soft Brexit. It is no more possible to know that than to forecast the leading contender in the race for British Prime Minister and what his love life is like. We cannot make out what is going to happen to Britain and what decisions that country will take on Brexit. This is a budget package that looks forward to a sum of €2.8 billion with €700 million for new measures. We have no commitment from the Minister for Finance as to how much of that he foresees as being available for tax cuts. I do not even know if the Minister actually wants tax cuts. I know the Taoiseach wants tax cuts because he keeps referring to them here as his go-to economic lift in the budget.

There is also no detail in this statement on how much additional funding will be spent if there is a no-deal disorderly Brexit. We have no information, or speculation, regarding likely commitments from the European Union for additional funding to support Ireland in the event of a hard Brexit. It is clear that income tax cuts in this scenario should be ruled out and the €700 million in additional measures should be committed to public services. That would be prudent and appropriate. There are great pressures in the areas of health, homecare, supports for carers, education and childcare. Above all, we have an ongoing crisis with housing and the affordability of rent.

I have the 2019 minimum essential standard of living, MESL, report from the Vincentian Partnership for Social Justice. It is a key document concerning what families require in rural and urban Ireland. The reports records that a one bedroom flat anywhere in Dublin, even in the cheapest area, costs more than €1,000 a month. It will cost about €1,125. That is the crisis we are living with and this summer economic statement is not even prepared to consider that crisis. The statement is surprisingly light on detail. I described last year's statement as being a novel. The subsequent ending of that novel was not great. As we know, by the time the budget arrived, the Minister had to resort to finding money down the back of the sofa to bail out the health service yet again. That was because the Government is unable to manage the finances of the health service.

The Minister is being more honest this year because he is already telling us that the plan will change substantially in September. We know that will happen based on what occurred last year. The announcement today suggests that no matter what type of Brexit we face, we are going to proceed with the budget plan. We do not know, however, if there will be a Supplementary Estimate or a special budget for exceptional measures if the UK crashes out of the European Union. I think this is a simple question. Nobody here wants the UK to crash out. It is, however, a real possibility that it will and this is a reasonable question to ask the Minister. What happens if that occurs and what will be the parameters of the figures?

The Minister is saying we should wait until after September. Perhaps he should wait until he has stood up on budget day. I cannot see why he should not deal honestly with the Dáil. He should not rule out a special Brexit budget. If there is a decision to spend more money, additional Supplementary Estimates will be needed. What is Fine Gael trying to pretend? We know €500 million was allocated to the rainy day fund this year and another €500 million will be put in for next year. What happens to the rainy day fund in a hard Brexit scenario? A hard Brexit would be a rainy day for Ireland. The way the legislation has been created means that it is not clear in what context the rainy day fund will be available. Would we need the European Union to declare it a rainy day? I am not sure what would happen. Will the rainy day fund be used in a disorderly Brexit? That is a reasonable question and the Minister for Finance should show responsibility and answer it.

I will turn now to the extra cash needed for the national children's hospital and the national broadband plan.

Here is a little clever accounting that accountants do all the time. The Minister has made Orwellian use of something called an "expenditure reserve" to allow for spending that he knows will happen. He is setting aside €200 million a year from now on for a special reserve to meet the holes in the financing of the national children's hospital and the national broadband plan. The Government will sneak this extra €200 million a year in to avoid the constant embarrassment arising from the overruns in both. This will ultimately be capital investment, but that has not been made clear today. We have gone back to the habits of Brian Cowen, the former Minister for Health and Children. He could not distinguish between capital and revenue expenditure for quite a while because of financial embarrassment. The health service of the time did not seem to be able to do it either. We are going back to that.

There is no commitment to a Christmas bonus in the summer economic statement. Some people might say this is quite a technical item. The Christmas bonus is traditionally provided for out of current resources because budgets traditionally fall either at the end of the year or early in the new year. The IFAC took issue with this. It stated that this is an in-year spending increase and, therefore, it should be properly provided for with regard to the relevant time spans. Last year it was provided for in a Supplementary Estimate. Supplementary Estimates amounted to €1.3 billion overall. However, there is no provision for the Christmas bonus in the summer economic statement. It is silent on that issue.

There are two possibilities. I think the Minister is going to pay the Christmas bonus, which I hope and recommend that he does. Alternatively, he will abolish it like Fianna Fáil did ten years ago. We had to reinstate it. Which will it be? That is a profoundly reasonable question to which the Dáil deserves an answer. I assume the answer is that the Minister will find that money out of what will be available in November, when a surge of self-employment tax payments will be received. Why not just share that with us now and be honest about it? It is an incompetently devious attempt to pull the wool over some people's eyes pretty much all the time. The Minister is trying to give the average taxpayer a little pat on the head and say everything is all right, and in any event he has the rainy day fund in his back pocket so if anything goes wrong it will all turn out all right on the night.

It is the intellectual equivalent of the famous soft landing that Fianna Fáil promised as the boom turned to dust. We heard about the soft landing everywhere. In fairness, everybody wished for a soft landing. Several people said differently, predicting there would not be a soft landing and it would be a total disaster for the country if the banks failed in Ireland. Will the Minister level with the Dáil? He writes book reviews a lot. Some of the book reviews he writes in various papers suggest he has an intense and detailed interest in economics, both practical and theoretical. I make a point of reading them and I commend him on them.

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