Róisín Shortall (Dublin North West, Social Democrats) | Oireachtas source

On behalf of the Social Democrats, I am glad to participate in this debate and to say that, as a party, we very much support the motion. It simply would not make sense to do otherwise or for the Government to consider transferring a huge amount of money into this fund. We welcome the clear decision in this regard.

There is no doubt that we are in a situation where unprecedented spending is required. I support the Government in what it has done to date in regard to the response to Covid, both in terms of the health response but also, of course, the response in respect of providing income support for the many thousands of people who have lost their jobs or have lost hours and work as a result of Covid, and also the substantial funding that has been provided to support the business community in this extremely challenging time. We support the Government in the action it is taking in regard to this decision and, indeed, the decision last year also not to transfer €500 million on the basis of the challenges faced by the country in the context of Brexit. Those two decisions are absolutely right.

The twin challenges that face the country with the unimaginable perfect storm that now exists regarding both Covid and Brexit are certainly unprecedented and pose the most enormous and unbelievable challenges for us. At this stage, there needs to be a rethink on previous decisions that were taken in respect of this fund and it is good that is happening. However, the fact that we are discussing this and that, for the second year in a row, the decision has been taken not to support the rainy day fund gives rise to significant questions about the existence of the fund in the first place.

I would like to raise the question of the decision made by Government to draw down the existing €1.5 billion which was in the fund for the purposes of budget 2021. On the face of it, it looks as if this is exactly the kind of unexpected occurrence for which the fund was intended. That is the case, in theory at least, but we need a lot more information regarding how that decision actually stacks up. The Minister referred to having access to that substantial amount of money and not needing to borrow €1.5 billion as a result of that drawdown. However, there are other questions in respect of which it would be helpful if we got some more information. As we know, the NTMA had invested that money and it was getting a return on it, so it would be interesting to hear exactly what that return was. In the context of a situation where money can now be borrowed very cheaply - at zero interest rates, or to some extent at negative interest rates - it would be very interesting to know whether a cost-benefit analysis was done on that decision. It would be helpful if, in his wrap-up speech, the Minister provided information as to how that stacks up in the context of what interest was being achieved on the fund, and what could have been done if a decision had been made to leave the fund there and borrow at those very low interest rates. I would be interested to hear the answers to some of those questions. That kind of detail was not provided to us at the time the decision was taken.

Apart from that, this debate raises questions about the rainy day fund itself. Given the very constrained grounds on which the fund can be spent, does it make sense to put money aside for situations which are unprecedented, although I absolutely accept those unprecedented circumstances have arisen this year? However, we have to ask would we be better off putting money aside for what is the generally accepted rainy day situation, where unexpected funds coming from corporation taxes are put aside for counter-cyclical measures to be put in place at a time when we have a dip in the economy. Would it make more sense to put that kind of money aside in the context of an infrastructure fund? The Minister has not actually said what his intention is for the future of the fund, which would be interesting to hear.

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