Dáil debates

Wednesday, 14 October 2020

Financial Resolutions 2020 - Financial Resolution No. 7: General (Resumed)

 

6:20 pm

Photo of Ossian SmythOssian Smyth (Dún Laoghaire, Green Party) | Oireachtas source

As Deputy Howlin has said, this budget is in the context of twin challenges to our economy, the enormity of which we have not seen before, namely, the pandemic and the challenge of a Brexit that may lead to the UK attempting to trade with the EU on WTO terms.

This budget represents the biggest investment in the history of our State. It is coming at a time when we need it most to protect the livelihoods of our people and to rise to the challenges of Covid-19 and a hard Brexit. Budget 2021 seeks to protect our society by providing countercyclical support to our economy and by investing in the key public services needed to support our people as we continue to live with the virus.

While responding to the impact of Covid-19 and Brexit are the immediate priorities, it is important that we make progress on key programme for Government commitments, in particular in the areas of health, housing and climate change. Putting in place the foundations for meaningful progress in these areas will deliver benefits for our people that will endure over the longer term.

The scale of the spending commitments set out in the budget represents an extraordinary response to the crisis we face. Pre-Covid we planned on spending €70.4 billion this year. Next year we now plan to spend €87.8 billion, an increase of €17 billion when compared with the pre-Covid position. This spending comprises: continued significant funding of €8.5 billion for our public services to address the challenges of Covid-19; a recovery fund of €3.4 billion to be used for measures to support the economy as we respond to the twin challenges of Brexit and Covid; €3.8 billion in core current expenditure for the delivery of improvements in public services and social supports; €1.6 billion for core capital investment with total capital investment funded by the Exchequer of more than €10 billion next year, which is the highest amount ever; and an additional €100 million to prepare for Brexit. This will bring the total spend on Brexit-related supports and preparations to €340 million next year. In addition, with a recovery fund of €3.4 billion, this provides the opportunity to earmark further resources in the most appropriate way to deal with the economic challenges of both Covid-19 and Brexit.

In providing an increase in core current expenditure of €3.8 billion and €1.6 billion in core capital investment, the Government is seeking to deliver meaningful improvements in key priority areas, particularly in health by implementing Sláintecare, in housing by building more houses and in progressing climate measures. The additional funding for health seeks to build permanent capacity and to deliver universal healthcare. With funding provided for an increase in staffing of up to 16,000 across the health service, this will be crucial to delivering the planned increased capacity including an increase in adult critical care beds to 321 by the end of 2021; a further 1,146 acute beds by the end of 2021; a further 135 subacute beds; and a further 1,250 community beds, including rehabilitation beds.

The Government is committed to addressing homelessness and social housing lists by directly building new social and affordable housing in significant numbers. A multiannual approach in this regard can both increase supply and moderate prices. This helps to deliver long-term affordability. The Department responsible for housing has a capital allocation of €2.8 billion next year. This is an increase of €500 million and is targeted at delivering 12,750 additional build, acquisition and leased units to the social housing stock, of which 9,500 will be built, with 800 targeted acquisitions and 2,450 leased homes.

Addressing the climate emergency is a key programme for Government priority with the recent publication of the climate action Bill. Taking action in this area can positively impact on society, helping to drive investment and create jobs while providing a healthier environment. The additional funding raised by the carbon tax increase is being ring-fenced to protect vulnerable people, with increases in the fuel allowance, the living alone allowance, the qualified child allowance, and the working family payment. This is to secure a just transition and to reduce our carbon footprint. An additional €100 million from the carbon tax increase is to be provided for retrofitting of our homes. This represents an increase of more than 80% compared to this year and will provide for a significant expansion of existing schemes including the warmer homes scheme. In addition to this allocation, €65 million has been allocated to the Department responsible for housing for retrofitting of local authority housing stock as these are the people who will most need their homes retrofitted.

Core capital expenditure in the Department of Transport is to increase by €600 million, more than 32%, next year. This will provide for a significant increase in capital spending on public transport and will fund progress for major Project Ireland 2040 programmes, including BusConnects, MetroLink and the DART expansion programme. We will fund €360 million in the ongoing development of a range of active travel and greenway infrastructure projects, walking and cycling, as well as for the enhancement of bus, rail and Local Link services throughout the country.

The actions included in the budget and the commitment represented by the climate action Bill are required steps to ensure that we effectively address the climate crisis. We face unprecedented challenges over the coming months. The scale of the expenditure resources for next year of €87.8 billion sets out the Government's firm intention to address the immediate challenges of Covid-19 and Brexit and to make lasting progress with climate change action to benefit society.

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