Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I propose to take Questions Nos. 32, 35 and 36 together.

The Irish Fiscal Advisory Council published its annual pre-budget statement on Wednesday, 16 September. As ever, this is valuable analysis and I welcome the council's contribution at an early stage of the budget process. It is also worth pointing out that around the same time, the Governor of the Central Bank wrote to me expressing broadly similar views to the council. The council noted that the macroeconomic outlook is exceptionally uncertain, with key risks relating to future waves of Covid-19 as well as the potential for bilateral trade between Ireland and the UK to be on World Trade Organization terms from next year. I agree with this assessment. Infection rates have increased further and additional measures have been put in place for some counties. Additionally, the Government has decided to base budget 2021 on the assumption of a disorderly end to the so-called transition period, given the high probability of it materialising. It is worth pointing out that the council is supportive of the unprecedented budgetary response that has been implemented by the Government in response to this terrible disease.

The council's view with regard to budget 2021 is that it should include a substantial multi-year stimulus so that targeted support measures are continued. Given the uncertainty remaining around Covid-19 and the future trading relationship between the EU and UK, the council further recommends an appropriately sized contingency to help to manage these key risks. Additionally, the council's view is that once recovery is established the public finances be brought back to a more sustainable trajectory. I broadly concur with these views.

Budget 2021 will prioritise a continued response to this crisis. The overall strategy will be to provide further countercyclical support to the economy. We will prioritise preserving and maintaining existing levels of service, make improvements where we can and where needed and target any additional supports to those sectors and workers who are most in need. I am also conscious of the need to put the public finances on a sustainable path. The Government will, in the first half of next year, set out a medium-term trajectory to restore balance to the public finances.

See this speech in context