Pearse Doherty (Donegal South West, Sinn Fein)
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Question 10: To ask the Minister for Public Expenditure and Reform the minimum figure in expenditure saving proposals he has been tasked with securing by the Department of Finance before bringing the comprehensive spending review to Cabinet. [20335/11]

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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Question 40: To ask the Minister for Public Expenditure and Reform the date by which he expects to be in a position to know the proposed annual estimates amount within which he will prepare the 2012 estimate. [20318/11]

Seán Fleming (Laois-Offaly, Fianna Fail)
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Question 47: To ask the Minister for Public Expenditure and Reform in relation to the adjustment of €3.6 billion in the forthcoming budget, his role in deciding the way this will be achieved through cuts in expenditure; and the amount that will be achieved through increased taxes. [20286/11]

Brendan Howlin (Wexford, Labour)
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I propose to take Questions Nos. 10, 40 and 47 together.

The task of settling the spending Estimates for 2012 will take place after the Government has considered the budget strategy memorandum from the Minister for Finance and a memorandum from me on the results of the ongoing comprehensive review of expenditure and the capital review. The overall target figure for the fiscal adjustment will be in line with the memorandum of understanding on specific policy conditionality of the joint EU-IMF programme of financial support for Ireland. It is much easier to refer to this as "the MOU". The figure involved, which is well known to the House and mentioned in one of the questions, is €3.6 billion.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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I understand from the Minister for Finance, Deputy Michael Noonan, that up to €1.5 billion of the €3.6 billion, or perhaps €4 billion, in savings will be achieved through "revenue-raising measures" and that the remainder will be achieved through expenditure cuts. As the person responsible for public expenditure, the Minister needs to give us a much more concrete sense of how he proposes to achieve this target, particularly given that he does not intend to publish the results of the comprehensive spending review in a single document, as he made clear in his response to earlier question. Is the figure of €2.1 billion correct, or will it be €2.5 billion? Given that the Government has made a commitment not to touch welfare payments, how does the Minister envisage achieving this target?

Brendan Howlin (Wexford, Labour)
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The Deputy will be aware that in the last published quarterly review associated with the memorandum of understanding, indicative figures were published. Those figures stand but there is an understanding that it will be up to the Government to negotiate within the parameters set. The parameter figure is €3.6 billion.

The other relevant figure is the deficit target for next year, which is 8.6%. The best estimate we have at present is that an adjustment of approximately €3.6 billion will arrive us at 8.6%. However, this is not set in stone because there are so many variables between now and the end of the year. The latter part of the year is the most important in terms of revenue, as the Deputies opposite will know. At present, revenue figures are steady and expenditure is on target as it is marginally below the indicative figures for the first half of the year by approximately 1.5%.

We need to be vigilant in terms of controlling public expenditure and looking at the tax take for the rest of the year. We will then be able to make a determination on what type of adjustment will be required to get to the target of 8.6% for next year. There is a range of variables, some of which will not be determined by the State such as the cost of the money we are getting. All of this may impact on the overall budgetary arithmetic.

The comprehensive review of expenditure is a process - not a book to be published - with many people making an input. I want to have an open process into which people input ideas without reservation so we can have all ideas properly costed. The timeframe is very short and it will not be as rigorous as I would like. The Canadians took years to do it but we do not have such a luxury. We will give it our best shot in the few months we have and we will then present our options to the Government and to the House.

Seán Fleming (Laois-Offaly, Fianna Fail)
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Questions Nos. 40 and 47 are also being discussed.

Brendan Howlin (Wexford, Labour)
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Yes.

Seán Fleming (Laois-Offaly, Fianna Fail)
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Two figures are being quoted, the €3.6 billion in savings-----

Brendan Howlin (Wexford, Labour)
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It is an adjustment, not savings.

Seán Fleming (Laois-Offaly, Fianna Fail)
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Yes, which includes tax and expenditure changes. Will the Minister give us an indication of his view on the €3.6 billion? The Minister for Finance mentioned that whether it was €3.6 billion or €4 billion was not the issue. The Minister also mentioned the 8.6% budget deficit target which is very important, and also brought into the debate the cost of the money we are getting. The Government is seeking a 1% interest rate reduction on the bailout fee. Is it possible there could be an increase in our interest rate in light of the recent ECB increases? The rate we are paying is linked to the ECB rate.

The Minister has two figures with which to work, namely, the 8.6% or the €3.6 billion. I ask the Government to take the lowest figure in terms of the impact on the people. Do not go for the higher figure. If the 8.6% can be achieved with €3.2 billion in cuts do it that way rather than going for a higher percent deficit just to stick to the figure of €3.6 billion.

Brendan Howlin (Wexford, Labour)
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The Deputy is very experienced and I put weight to his suggestions. The trajectory we are on, which we must achieve and which we are determined to achieve, is a 3% deficit by 2015. It is an incremental process and the incremental target we have set is 8.6% next year. The indications were that an adjustment of approximately €3.6 billion would achieve this. Given that there are so many variables, we will have to see later in the year whether this will continue to be the case.

We need to show discipline and take control of our own economic destiny as quickly as we can. The timeframe we have set will be vigorous and difficult and it will be hard on people who are already groaning under the pressures that have been created. The Government knows this full well. It should be explained to people and we should be open with them and explain it is not a folly but a destination to get us back our economic sovereignty so we will be in charge of our own destiny. The Irish people desperately want this.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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The difficulty with the Minister's argument is that all the evidence to date suggests this bailout arrangement is not the route back to economic sovereignty. If we take the three months since the Troika was last here and examine what has happened since, the domestic economy is still in crisis, unemployment has increased and Irish debt has been relegated to junk status. If the game plan was for the bailout to get us fit to return to the debt markets and regain our sovereignty it is failing. All the while this failure persists, people suffer swingeing cutbacks and austerity and hardship as the Minister has acknowledged.

Here is a figure for the Minister to consider in his calculations, because he has mentioned a large amount of money. The 3% surcharge on EU moneys to the State alone will cost us approximately €9 billion. Talk about friends profiting on the hardship of their alleged friends. I know I will not convince the Minister or the Government as to the folly of their direction but at the very least they must recognise when the indicators for progress and success they establish clearly and manifestly fail.

Brendan Howlin (Wexford, Labour)
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The analysis coming from the Deputy opposite is invariably the same. I debated this with her in advance of the election. She is great at analysing the failure of somebody else's policy but a bit weak on offering an alternative. The truth is we need to get control of our own fiscal destiny. The only way to do this is to balance our budget. We cannot continue to borrow, as we are, €18 billion this year. It is just not possible. It is worse than an illusion, it is a deception, for some of the Deputies opposite to pretend that somehow if we tell the EU and IMF we do not want their money any more or we stop paying it back that we can still borrow. Nobody else will give us money.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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We cannot borrow as things stand.

Brendan Howlin (Wexford, Labour)
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We are borrowing money; we are borrowing it from the Troika, from the EU and the IMF and the European system of financial supervisors, ESFS, process-----

Mary Lou McDonald (Dublin Central, Sinn Fein)
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Not on the markets.

Brendan Howlin (Wexford, Labour)
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We are borrowing it at an affordable rate. The markets are unaffordable to us, the Deputy is right. It is disappointing that one rating agency has made a decision but, as one can see from the reaction of the German Chancellor and the Commission they do not agree with it. We must stick to our purpose, which is not to despair or give the counsel of despair or say we will collapse our own economy. We will, as we have done, map a way to economic solvency.

The people of Ireland have met the targets we have set. They have carried the burden with industrial peace because people want us to succeed. They want the Government to succeed in returning us to economic solvency. This is why there is still good will for this. There is hardship and people will resist the individual measures which we will try to make as fairly as we can. However, there is no alternative way. When one sees what the cost of money would be if one could buy it or get it on the open market it is wrong to suggest that our way is a folly. It is also wrong to suggest that somehow one can magic away the debt and continue to borrow money after telling one group of people to take a hike. That is a folly.

It is unfortunate that one rating agency has made the decision it has but it will not distract the Government and the very strong support we have had from the people on whom we depend to fund us. We are completely funded well into 2013. One has seen the dramatic changes that have occurred in the past two years. Who knows what will happen in the next two years but we will, step by step, get ourselves, our country and our economy onto a good footing.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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The case the Minister makes for having to impose the "adjustment" as he calls it of €3.6 billion, which means, as he acknowledges, such severe austerity for ordinary people in the country is that we must deal with the deficit problem and that we have no choice but to borrow the money.

As an aside, although I do not think the Minister will agree with me-----

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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Put a question.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Is it the case that if we repudiate the private banking debts the markets might consider lending to a State that would be in a much better financial position? Setting aside this question, which the Minister might answer briefly, is it the case that much of the deficit results from the fact that 350,000 extra people are unemployed? As a result, the burden on the State's finances adds up to approximately €7 billion. The reason we have such a big deficit is because so many people are unemployed. If we put those people back to work-----

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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Thank you Deputy, a question please.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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-----which would mean resisting the EU and IMF austerity programme, then our public finances would be in a much better state by approximately €7 billion. Add to that the €5 billion we must pay in interest repayments this year and a little tax on the wealthy in the country and one could make up the deficit without imposing austerity.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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Perhaps the Minister should ask questions and the Deputy should answer them.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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I asked a genuine question.

Brendan Howlin (Wexford, Labour)
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The Deputy has always been in fantasy land which is a comfortable place to be as it allows one to preach that people do not need to take medicine because the magic doctor has a cure and the rub of the relic will cure all. As to the notion that one can repudiate the debt by deciding to look into one's heart and refuse to pay it-----

Mary Lou McDonald (Dublin Central, Sinn Fein)
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You should not be facile. It would be done through a debt resolution mechanism.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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Deputies should address their remarks through the Chair.

Brendan Howlin (Wexford, Labour)
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-----while at the same time deciding that everyone who is unemployed should go back to work, who would pay the €18 billion we are borrowing? That is the gap that would open up instantly.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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We are paying through cuts in social welfare.

Brendan Howlin (Wexford, Labour)
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Who would pay for the schools, hospitals and gardaí? In Deputy Boyd Barrett's heart of hearts, he knows his proposition is entirely fanciful.

The Government has embarked on a path which will lead to a restoration of our finances and which has job creation at its heart. One of the first steps we took was to renegotiate the first memorandum of understanding to ensure we had up to €500 million in job focused expenditure. In the tourism sector, this expenditure has been effective from 1 July. I hope this initiative, of which we require more, will pay dividends. The more control we gain of the economy, the more decisions we can make to stimulate growth. The Deputies opposite are correct to the extent that we require economic growth to get out of the current mess we are in and that we must ensure job creation is at the heart of our decision making. However, the notion that there is some magic way of eliminating debt is a folly, as the Deputies know full well.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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Question 11: To ask the Minister for Public Expenditure and Reform his target date for publishing the Estimates of Expenditure for 2012. [20317/11]

Brendan Howlin (Wexford, Labour)
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While the exact dates have yet to be decided, budget 2012 would normally be presented to the Dáil in early December and include budget Estimates for 2012. The Revised Estimates Volume for 2012 would be published the following February and contain more detailed expenditure information on all Votes. The Estimates would then be referred to the relevant Dáil select committees on the same date, before being voted on by the House.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I thank the Minister for the information provided. I understood he and members of the Sub-Committee on Public Expenditure and Reform agreed that the Estimates for next year should be discussed before the end of this year. He has indicated that the Revised Estimates Volume will be published in February 2012, which means it will probably be discussed after St. Patrick's Day. Estimates used to be published in February because the budget was introduced in January. That is the old approach taken in the Department of Finance. The Minister should inform the Department that the date of the Budget Statement was moved to December a couple of years ago. The only reason for publishing a Revised Estimate after the budget is to provide for budget expenditure not included in the Estimates, which used to be published in advance of the budget. As the Budget Statement and the Estimates are published simultaneously, they should be debated before the end of the year. I ask the Minister to review the matter to ensure the 2012 Estimates will not be discussed after St. Patrick's day.

Brendan Howlin (Wexford, Labour)
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As I indicated yesterday, I do not regard the traditional Estimates process as a good one and would like to consider how the process can be reconstructed in a more useful way. The Estimates volume has become a little lost as a result of the practice of publishing it on the same day as the Budget Statement, the reason being that people focus on the fiscal and taxation measures included in the budget. I am open to ideas on how we can deal with the Estimates in a different way. Given the Deputy's experience in this area, perhaps he will produce some ideas over the summer and advise us of them after the recess. I offer the same invitation to other Deputies. Other Ministers and I would welcome a better and more open debate. My Estimates are, however, fairly rigid.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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I concur with Deputy Fleming and welcome the Minister's openness to suggestions. We should return to this matter when business resumes in September. I hope the Minister will make a commitment that if realisable proposals are put to him-----

Brendan Howlin (Wexford, Labour)
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They must be practical.

Mary Lou McDonald (Dublin Central, Sinn Fein)
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Yes. If such proposals can accommodate a tighter arrangement for the 2012 budget and Estimates, I hope the Minister will facilitate them.

Brendan Howlin (Wexford, Labour)
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I have sat through many debates on Estimates at committees, mainly as an Opposition Deputy, and they tend to be a little sterile. One normally examines whether a few thousand extra euro is being spent in some area and, as a result, one misses the wood for the trees. I do not know whether we could have a principled debate on Estimates expenditure. Perhaps I am not explaining myself very well. I may give some thought to the matter and we could share some ideas.