Neale Richmond (Dublin Rathdown, Fine Gael) | Oireachtas source

I appreciate the opportunity to speak in support of this motion and, indeed, in support of this concept. For everyone in Ireland, 2020 has been an unprecedented year. After years of preparing our businesses and the economy for the threat of Brexit, we also faced a new challenge in Covid-19 and the economic ramifications that followed. These twin threats have had an immense impact on every aspect of all our lives - our businesses, our finances, our mental health and our families. When the Covid crisis hit Ireland, it became clear that extraordinary actions would be required to protect our citizens. The Government took the necessary action to shut down large sections of our economy, when necessary, in order to save lives and protect our health service and our front-line workers. It did so effectively and, as a result, we are now in the position of having one of the lowest - if not the lowest - rates of Covid-19 in Europe.

While this was the correct decision, it came at a great cost to our economy. Of course, the main goal of these restrictions is to save lives and protect the health service. Many thousands lost their jobs or saw their income decline. Many businesses closed permanently and the damage was felt around the country, with no corner untouched. GDP fell by 6.7% in the first and second quarters of the year, although this was less severe than the decline seen in the rest of the eurozone, in the UK and in the US. While these restrictions have saved lives, they have had a serious cost to the economy, so measures have been put in place to limit such damage as much as possible. We have certainly been supported by our colleagues in the European Union through this crisis but much of the support is down to our own fiscal prudence in recent years. Indeed, the Government has committed to keeping supports in place for as long as they are required.

We must remember that the reason we have been able to respond to the pandemic so quickly and without hesitation is because we had the financial resources in place which allowed us to do so. We started 2020 with a surplus of €1.9 billion and a rainy day fund of €1.5 billion. The economy was healthy and growing steadily. There were many challenges but we were able to put the health of our citizens at the forefront of our crisis response. It was because of this that we did not immediately need to draw down on the rainy day fund during the first months of the pandemic. When it became clear that more restrictions were required, the decision was made to utilise these funds for budget 2021. By using these funds, we do not have to borrow more on the market. Although Ireland has a high credit rating on the market which means we can borrow at an affordable rate, we always have to be cognisant of burdening future generations with excess debt.

It is available to us but we should not take advantage of it.

As we look towards the end of the Brexit transition period in a number of weeks, although we still do not know whether a deal will be agreed between the EU and the UK, this rainy day fund will become even more important. The Minister, Deputy Donohoe, deemed it appropriate to draw down the rainy day fund for budget 2021 to ensure that the needs of people, businesses and the economy can be met. Budget 2021 has been designed to protect Ireland from the twin burdens of a no-deal Brexit and Covid-19. It is the largest budget in the history of the State with more than half of spending going on Covid supports to see the economy through this crisis. A recovery fund worth €3.4 billion was included to allow the Government to react swiftly to the challenges that may arise from Brexit and the continuing challenges of Covid-19.

With January fast approaching and many details of Brexit still largely unknown, this fund will be of huge value to businesses, employers and, crucially, the individuals involved therein. Customs charges, tariffs and fees will possibly be a new reality for all Irish businesses and although the vast majority have prepared for those changes to the best of their abilities, issues will appear over time because it is impossible to be fully prepared for Brexit, particularly when we still do not know the exact form it will take. However, we are now able to reach these issues as they arise and without hesitation and, in doing so, we were able to support our businesses as best as possible.

We have the ability in this country to react to a constantly changing world and ensure that our citizens are not left behind and are supported at each step. When the rainy day fund was established in October 2019, Covid-19 did not exist and Brexit was still some time off. Little did we know just how valuable this fund would be to Ireland. The prudence shown by this Minister has been vitally important. All those who received the pandemic unemployment payment, Brexit supports or training or who availed of the employment wage subsidy scheme did so with the support of this fund.

Although we are not in a position to contribute to the rainy day fund this year, it is because of this fiscal responsibility that we have protected our economy. When we are past these crises and are in a position to build up the fund, we will once again be able to put our economy in safe hands. I have to stress that. I have reacted to comments from some people who say they object to the process of a rainy day fund but in the past few months, we have seen the importance of it. I fully accept that while we are not in a position nor should we aspire to contribute to the fund at the moment, it is of vital interest to the country that we continue to prepare the next phase of the rainy day fund as soon as possible. We have seen how important it is to every single individual in this State and how much more important it will be as we move forward.

Fiscal responsibility and careful management to ensure that we always have a life jacket when we need it is always important. There will always be challenges in an economy in every sector. There will always be decisions to be made by responsible finance and public expenditure Ministers but at the heart of that must be a commitment to a rainy day fund that provides that protection, that life vest, so to speak, at difficult times when we need it. We have very much needed it in the past few years and we cannot put any future eventuality or difficulty solely into the hands of the global economy. The markets are favourable now but they may not be in the future. We have continuing European solidarity but Covid-19 has hit all of Europe and those resources might not be available if something as drastic as a pandemic, albeit one like this has not been seen in a century, occurs. We never know what the next challenge will be and ensuring that we have that level of security and decent, common sense is vital. If we were running a business or a household we would always have a little extra put aside in case a rainy day occurred. If it is good enough for every household and every decent business in the country, it is the responsibility of any Government to ensure that we can meet any potential difficulties in the future. In that regard, I implore the Minister to reinvest in a rainy day fund when the opportunity arises.

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