Timmy Dooley (Fianna Fail)

I join with colleagues in welcoming the Minister of State and the publication of the Book of Estimates for this year. Great credit is due to the Minister for Finance, Deputy McCreevy, the Minister of State and the entire Government for achieving this remarkable level of public spending again this year. There is a 5% increase in public expenditure despite the straitened economic circumstances we have witnessed for the last two years. That increase in public spending is particularly welcome against a backdrop of the decrease in inflation to 2.3%, announced on the same day. This, coupled with the increases as recognised, puts us in a strong position for the next 12 months. It will hopefully position us to benefit from the recovery in the US and other markets with which we trade and on which we are dependent for continued growth.

The 5% increase has been achieved without a return to the old economic norms of boom and bust, largely characterised by significant public borrowing. It would be easy to have a spending rate of 5% if we were to continue to borrow as in the past. However, there is a relatively small level of borrowing, in the region of €3 billion for next year. To achieve such a level of expenditure with limited borrowing is particularly good. That is largely driven by the Stability and Growth Pact from Europe. There has been much debate about that over the last few days. I would like to raise a particular issue with the Minister of State on the borrowing under that pact, particularly borrowing by local authorities. This is creating some concern in local authorities, particularly regarding projects that require significant financing, which will become self-sufficient at a later stage. I do not wish to be parochial but there is a significant project in north Clare, an interpretative centre connected with the Cliffs of Moher. This depends on the county council being able to borrow matched funding. We are hoping to get grant funding—