Brian Hayes (Dublin South West, Fine Gael) | Oireachtas source

I thank the Senators for their amendments. As stated during the Dáil debates, on both Committee and Report Stages, the policy issues raised in the amendments are of much wider scope than the substance of the Bill. The Senators have identified some of the issues any Government would have to consider in preparing a correction or budgetary plan. However, it should be noted that we are talking about a plan, not the actual detailed legislative and budgetary proposals that would have to be brought before the Oireachtas in the normal way.

A key purpose of the Fiscal Responsibility Bill and the stability treaty is to correct budget imbalances where we have deviated from converging with our medium-term budgetary objective, from the adjustment path or complying with a debt rule. Section 6 was drafted on the basis of common principles, as required by the treaty. While the Government - or any future Government - will always seek to promote economic growth, job creation and the delivery of high quality public services, it is highly likely that deployment of a correction plan could result in unpalatable choices that might not be in compliance with the suggested amendments, at least in the short term. Having sustainable public finances is a key element of sustainable economic growth. Giving priority to economic growth, job creation and the delivery of high quality public services could, therefore, prove to be an obstacle to or a limitation on the Government's choice in terms of the actions needed to ensure sustainable public finances.

In working to ensure the sustainability of public finances, any government should be able to access all possible policy levers. Every budget day the Government publishes illustrative cases showing the effect of major changes in revenue and certain social welfare payments on the categories of married couples, civil partners and single income earners. The impact of the budget on the various groups of people is set out.

With regard to requiring Oireachtas approval before adopting the plan, amendments which could result in the contravention of our treaty obligations cannot be accepted. The stability treaty requires the triggering of a correction mechanism if there is a significant deviation from the medium term objective or the adjustment path towards it. Furthermore, non-compliance with the budgetary rule would contravene the stability treaty.

I do not propose to accept Senator Barrett's amendment No. 10, which would require a statement to be laid before Dáil Éireann within one month. I am grateful for the comprehensive Private Members' Bill which the Senator introduced to this House. His Bill was in effect parked because the Government is bringing forward its own legislation. I assure him there is convergence between his legislation and what the Government proposes to do. I hope the final Government Bill will reflect the key objectives he set out. The Seanad decided not to oppose his Bill because it made a constructive contribution towards the final product that we are now debating.

While amendment No. 10 makes an interesting contribution to the debate and suggests a need for urgency, I remind Senator Barrett that the plan under discussion involve steps aimed at avoiding the breach of the budgetary rule. Such a plan could involve information on budgetary and expenditure measures. The preparation of such material takes time and a tight deadline would only contribute to an increased risk of error. The recent economic history of this country suggests that events have a tendency to overtake us. Two scenarios spring to mind. The first is where the Government concludes that it may fail to comply in the run up to the annual budget. A requirement to present a plan within one month could result in two major budgetary announcements being made in a matter of weeks when it may be more appropriate to await the national budgetary announcement. A second scenario would be where a requirement falls due during or just after a general election campaign. Such matters should be left to an incoming Government to decide. For these reasons, the provision was drafted using the word "may" and the period of two months. There is nothing to prevent the Government from publishing its plans within one month and that would be the optimal timeframe but the Minister for Finance believes that setting a deadline of one month is too prescriptive. The general framework of two months allows greater latitude in terms of what has to occur under this section.