Brian Ó Domhnaill (Fianna Fail) | Oireachtas source

I think the statement provides an opportunity for a mid-term reflection on where the country is heading before the budget. It is one of the good things that has come out of the new European framework on economic recovery and oversight of member states. The European Commission and the European Central Bank were very slow to react, as has been commentated upon widely, to all of the chaos of the financial crash that we experienced in Ireland. However, one of the proactive measures taken relates to the new fiscal rules. In itself, that brings strength and stability to our public spending and keeps Departments and public indebtedness in check because there are clear targets which must be met.

We are debating the summer economic statement in the aftermath of the debate which took place on it in the Dáil. I understand the latter occurred before the referendum on Brexit.Now our debate is taking place in a changed economic climate. The result of the Brexit referendum will bring economic benefits and challenges to this Republic.

The flexibility of having fiscal space, which was being bandied about during the general election campaign, is not now achievable unless the international economic factors at play are favourable. We have seen the benefits of the 14 quarters of positive economic recovery, largely due to exports to other markets, including about 17% of our overall export trade going to the UK market. The Brexit result has the potential to impact on consumption in the UK markets. In addition, currency fluctuations will affect our trade with the UK. We now operate in a changed climate. The UK equivalent of the ESRI in Ireland carried out a study of the impact of a vote to leave the European Union on GDP and suggested it could result in a negative fluctuation of 2.3% to 6% in the UK economy and that every 1% deflation in the United Kingdom would have a 0.2% negative impact on Ireland. That is a real consequence of Brexit.

If we take the figures of the Treasury and the National Institute of Economic and Social Research in the United Kingdom, one is looking at a potential decrease of 0.5% to 1.2% in our GDP projections. That is alarming but there are beneficial factors as well. I would like some of those to be exploited. I would like to know what is happening in the Departments of the Taoiseach and Finance to capture some of the potential financial jobs coming out of London. We know from reading the British press that major companies are looking at moving out of London and going to another European city - presumably a country where English is spoken would be beneficial to those companies. We have a housing crisis in Dublin so that does not lend itself to attracting some of those companies.

There are major challenges which have been documented in the summer economic statement published by both Departments. Those challenges revolve around housing. There are major issues around mortgage arrears and the courts are clogged up with people who are being taken to court by financial institutions. While it would appear that the banks are sending out the signal that they are being proactive, I do not think that is happening in reality. There is a lot of blocking taking place. One can blame the banks, but blame can be apportioned to both sides, including to the borrower who is refusing to pay.

Projected demand for health services up to 2021 will cost an extra €6.75 billion. That would eat up a lot of the fiscal space that has been talked about. We have a growing population, and people are living longer and these factors will be a major challenge to the health service. We are spending more on health per capita than any other OECD country but yet the outcomes are not what they should be. That is a major challenge that needs to be robustly taken on not just by the Department of Health but by a cross-departmental body, which should be established to look at providing and driving efficiencies and effective outcomes for patients and for all consumers of public services in the county. It is clear that we are not getting value for money in our health service. New hospital groupings have been established to drive efficiencies but in my own area, the north-west region, administrative costs have increased by one third. There are major challenges which need to be taken on. While the Government response to driving efficiencies has been to reduce cost and we saw that across the local authorities where the Government took local representatives out of the system, saving €400 million, however the service being provided to the public has not been what it should be.

We need to adopt a holistic approach in terms of value for money. I think there is a need for an agency to drive that in government. Perhaps that is an issue we could debate on another day.