Dáil debates

Wednesday, 4 February 2015

Other Questions

Budget Consultation Process

10:30 am

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein)
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8. To ask the Minister for Finance his views on whether the budgetary process would benefit from the creation of a specific body to provide independent costings of alternative budgets from Opposition parties and if he sees an existing body such as the Irish Fiscal Advisory Council taking on such a role. [4654/15]

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein)
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This question seeks the Minister's view on whether the budgetary process would be enhanced by the creation of a specific body to provide independent costings of alternative budgets from Opposition parties, whether an existing body such as the Irish Fiscal Advisory Council could take on this role and whether this process would enhance the type of debate we have on proposals from the Opposition in regard to policy matters and alternative budget formulation.

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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The proposal raised by the Deputy is one that surfaces from time to time and its consideration has already led to steps in this direction. For instance, my Department provides costings in regard to taxation proposals on a confidential basis to assist parties in advance of general elections or budgets. However, it is fair to say that these costings are limited by being provided on a static, individual basis without analysis of the general government implications or potential economic effects.

A further factor is that Ireland is entering the preventive arm of the Stability and Growth Pact and this will have major implications for fiscal policy in the coming years. Initiatives that improve the quality of debate around budgetary priorities and the best allocation of resources should be encouraged. Accordingly, I am coming to the view that the proposal should be considered in depth. This is a complicated matter and the work undertaken by such a body would have to be subject to strict terms of reference. Care must be taken to ensure that such a body does not supplant the role of Government and the Oireachtas through gaining, for instance, an effective veto power over proposals that it dislikes in purely economic terms.

Various models of this type of service and body already exist. These include independent bodies or offices under the aegis of parliaments. An important factor must be the need to bear in mind the resource implications, both in terms of expenditure and staff. Too much duplication must be avoided.

The Deputy asks if the Irish Fiscal Advisory Council could take on such a role. While this could be one of the options, my first reaction is that it would be difficult to combine its current functions with such a role. We need the council as a fully independent voice to assess the fiscal stance and to assess compliance with the fiscal rules Ireland signed up to in the Stability and Growth Pact and the Fiscal Compact. It also endorses the macro-economic forecasts. Even if the differing roles could be made fully compatible, I think it is safe to say that the current part-time role of the council members would not be feasible.

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein)
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I welcome the Minister's response to this proposal, which I have been making for some time. I note from the Official Report of the Dáil that this matter was also raised with the late Minister for Finance, Brian Lenihan, by the Tánaiste when Labour Party Opposition spokesperson on finance and by other Deputies. The provision of this type of process would allow for a proper, realistic and wholesome debate on alternative budgets. However, I ask that the Minister ensure that the process is not only the preserve of Government and that in coming to a decision on the best way to proceed there is engagement with Opposition Deputies, particularly those who hold finance portfolios and those who take these issues seriously in terms of their parliamentary work. The finance committee might also have a role to play in regard to what is proposed. I would encourage that this proposal be proceeded with.

I suggest that to complete the circle we also need to deal with the constitutional amendment. I have tabled legislation on this issue but it was not accepted. That Opposition Deputies cannot table particular amendments to a Finance Bill is archaic. There is a need for reflection on how to ensure proper debate on finance legislation. That Opposition Deputies cannot table particular amendments for discussion on Committee Stage does not allow for full debate.

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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I have not fully developed my views on this yet but I agree in principle that we should move in the direction signalled by the Deputy. I agree also that the Opposition should be involved in developing the ideas. When my own thoughts have developed a little further I will meet with Deputy Doherty, Deputy Michael McGrath and the representative on finance from the Technical Group to see how we can move forward and have a meeting of minds on this matter. My thinking is that this should be done by a unit within the ambit of the Oireachtas Commission and that it should then be independent of the Government and the Department of Finance. We will also have to put in place some terms of reference of access because as well as having party access we need access by individual Deputies who want to bring forward proposals.

It might be appropriate to tie this in to the Friday sittings so that the proposals are not just arid and theoretic. We could have a first run at proposals by way of rehearsed debate on the Friday to get the views of colleagues on them. However, that is a matter for individuals. That is my current thinking on the matter. As soon as I have fleshed it out a little more I will be in contact with the Deputy. We can then meet over a cup of coffee or deal with the matter through the finance committee, whichever the Deputy wishes.

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein)
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I appreciate that. This is long overdue. I welcome that the Government has agreed to it. While this issue has arisen as a result of the, in my view, nonsensical debate in regard to budgetary costings, budgets were never costed by the Opposition until 2011. This is something new that has crept into the debate, although it is somewhat welcome. The debate around whether all proposals or individual measures should be costed should be a thing of the past.

I also believe that not only budgetary costings but policy proposals should be addressed. For example, the issue of child care costs was raised earlier. If a proposal in terms of a policy for child care is put forward it is important we have the option of having an independent analysis of its implications, outside of general manifestos already provided. I welcome the Minister's comments on this matter and hope that the process moves along at a pace that is necessary to allow this to be put in place as quickly as possible, while ensuring the system is robust. I have concerns around whether the Irish Fiscal Advisory Council would be the best vehicle to do this. However, I and my party are open to engaging with the Minister on this matter.