Results 12,161-12,180 of 32,924 for speaker:Paschal Donohoe

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: The Deputy is correct regarding that particular event but I do not believe investment in precautionary measures would offset the need for a reserve fund in the future. That is for two reasons. The first is the variety of different events that might require use of a contingency fund. In the papers I referred to a natural phenomenon. For example, what would happen if we had another episode...

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: I am only in the early days of making-----

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: I am only in the early days of answering questions on this and already I am being interrupted by Deputy Broughan. I look forward to answering his questions in a moment but I will continue answering the questions put to me by Deputy O'Brien. For that reason, I do not believe that investment in precautionary measures will offset the need for a reserve fund in the future. Regarding...

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: I agree with the Deputy's first point that it must be counter-cyclical. Her second point indicates the difficulty in this regard. I have never had anybody in this Dáil calling on me to spend less. It never happens. All the demands - many of them legitimate - are to spend more. That is why it is valuable to have a precursory discussion about the matter before we move to the...

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: The moment somebody comes up with a serious idea of how we could spend less in a Department, I would appreciate it if I could get a call so I could at least be there to hear it. The Deputy spoke about the number of years involved with putting together the rainy day fund and the opportunity cost, and this is the challenge we will face. The moment this or a future Government starts setting...

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: I have a brief response. My expectation is that the easily measurable and more easily quantifiable interplay between the setting up of a rainy day fund and use in the here and now will probably be the choice we will face regarding whether we set up a rainy day fund or pay down debt. There will be an opportunity cost in doing this and we will struggle to quantify it because it will mean not...

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: When historians look back at the verdict on the former Minister, Deputy Michael Noonan, they will see that he was a Minister who, despite the profound crisis facing the country, made choices that enabled the country and our society get to a point the Deputy said we would never reach.

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: The Deputy is someone who for many years-----

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: The Deputy is someone who for many years said-----

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: -----the recovery that is now happening would not happen and that the economic resources now in place would never be available.

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: On his contribution and all of the contributions he makes, I agree with him on the level of need and the many challenges we face in public services, whether it be health or housing, and I am committed to addressing them. On the same side of the coin let us also acknowledge that we are now in a position where it is very likely later this year that we will have more people at work than we ever...

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: It is unlikely that it will make a significant return. One of the reasons for having it is that one would be able to access it if it was needed. If one is to access it when one needs it particularly quickly, it means that there will be a trade-off in that regard in terms of a return. It would be a low level of return versus longer term options that would be open to the State.

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: It depends on the type of instrument involved. We would be able to access money in a matter of days if we needed it.

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: There are no particular criteria for how NTMA money can be used. That money is on the balance sheet. The benefit of setting up a rainy day fund such as this is that there will be specific criteria for how that funding may be used and one will do it in such a way that it is compliant with the fiscal rules.

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: What is the objective of this fund? The objective is that if the economy gets into difficulty in the future, money will be available to us which we can invest in the economy to offset that difficulty. I am struck by the fact that some of the countries that have been most successful in doing this, although they are asset rich, are those of a socially-democratic persuasion politically. When...

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: My explanation does stand up. I am not putting this proposition forward with the direct objective of reducing our gross national debt. I never presented this proposition in such a way. As I have said on a number of occasions, this is about creating the capacity for the State to deal with an external shock in a way that avoids the need to borrow in the future at what would be a higher...

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: The kind of things I see it being used for include global recession, which has a significant effect on a very small and open economy; a natural disaster of some kind; some event happening in the financial markets; or as a result of policy choices made here at home that lock us out of access to the financial markets again. I used the example earlier of a disease that affected our economy and...

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: That risk is absolutely there. The policy on it has to strike a balance between being prescriptive enough that it cannot be accessed to deal with the kind of difficulties any Government might face, day after day and year after year, while at the same time not being so prescriptive that a Government can never use the money. The Minister for Finance of the day would be central to that choice.

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: Yes. I go back to the point I made earlier. Traditionally, when economies such as our own have had to deal with global events or the kind of phenomena I outlined a moment ago, the way they do it is by borrowing more. That is a perfectly legitimate policy choice to make. It is perfectly legitimate to borrow more and to respond to difficulty. There are many levels of borrowing that can...

Committee on Budgetary Oversight: Proposal to Establish a Rainy Day Fund: Minister for Finance (31 Jan 2018)

Paschal Donohoe: I am optimistic we would be able to do it. Organisations such as the IMF are very supportive of the principle we are looking at here. One of the main thrusts of current EU policy is that expenditure or macroeconomic decisions by governments should take account of where an economy is at a particular point in its cycle. That is why we have so much focus on something that is simple in concept...