Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

This motion authorises the Minister for Finance, in accordance with section 6(1) of the National Surplus (Reserve Fund for Exceptional Contingencies) Act 2019, not to pay the prescribed amount of €500 million into the national surplus reserve fund for 2021. This relates to the so-called rainy day fund which was established by Fine Gael to burnish its image as a prudent manager of the public finances and which was championed by Fianna Fáil in an attempt to restore trust in its ability to manage the public finances after it torpedoed the Irish economy a decade ago. I support the motion. It would be foolish to divert resources into the fund when we still face the challenges posed by the pandemic, while our hospitals and patients suffer unacceptable waiting lists, while the housing crisis deepens and while climate breakdown confronts us. Sinn Féin will support the motion.

It should be noted that despite being established in June 2019 this fund never really got off the ground and it lies empty. Some €1.5 billion was transferred from the Irish Strategic Investment Fund, ISIF, in 2019 and spent in response to the pandemic. We should not fool ourselves or anyone else for that matter; that money could have been spent directly from the ISIF without being pit-stopped into the so-called rainy day fund. Under the legislation, €500 million was to be transferred into the fund each year from the Exchequer, including in 2019, 2020, 2021 and 2022. No money was transferred from the Exchequer in 2019, 2020 or 2021. There has always been something more pressing for which the €500 million of resources has been needed and so the fund is empty.

When the legislation was first debated I said that it was already raining. We have a housing crisis that is damaging the fabric of our society and the competitiveness of our economy. It is also burning, with a climate crisis that requires significant supply side investment to provide alternatives for low and middle income households. It was always my suspicion that the rainy day fund was more of an electoral gimmick than a serious innovation in fiscal policy. It was established shortly before a general election and was often touted as a great example of prudence together with a budget surplus in 2019. Every time we have debated these motions since then the two have been mentioned together by the Minister for Finance or by Government Deputies. The surplus that year was achieved due to an unexpected bumper receipt of corporate taxes, not as a result of budget policy. Boasting of a surplus at a time when the housing crisis was deepening is not an example of sound fiscal policy but of poor economic management. The housing crisis is after all a result of the fiscal and economic policy of this and previous Governments.

Sinn Féin will support this motion. We suspect that the Minister for Finance will ask us to do the exact same thing as in this motion next year and that the fund will still lie empty and idle. Given the debate this allows, I mention fiscal policy more broadly. The object of same should not just be to reach a certain number to one or two decimal places and then to wave that number around to the electorate in the hope of admiration. The object of fiscal policy must be to achieve economic and social outcomes. In too many areas the economy is failing. The housing crisis is damaging lives as well as our competitiveness. Childcare costs are hurting families as well as female participation in the workforce. A neglect of research, innovation and higher education has not only restricted employment opportunities but it has hampered the productivity of indigenous enterprises. In those areas we must do better and we can do so provided we have the right Government.

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