Alice-Mary Higgins (Independent) | Oireachtas source

I welcome the Minister, Deputy Donohoe, to the House. In his speech yesterday he highlighted two underlying assumptions in respect of this budget, first, that Covid-19 will remain with us for a long period of time and, second, that, unfortunately, we may be looking at a scenario of Brexit without a deal from January. I would agree with both of those assumptions and it is important that they are factored into and reflected in the budget. However, there is a third assumption that underpins this budget, and has underpinned fiscal policy for a long period of time, which needs to be challenged and re-evaluated. That third assumption is that reducing the deficit must remain a priority and be a central focus, even in a time of crisis. That assumption goes against what we have heard from international institutions not simply responding to urgency of Covid-19 but also in terms of learning from some of the mistakes that were made in response to previous crises we have experienced.

There is a point I need to nail down. I worry sometimes that we might forget history. We know what happened when risks developed in our national finances. We will not let that happen again. We really need to be clear on history. It was not public expenditure that caused the financial crash in 2008. It was inappropriate speculation by financial actors followed by an extraordinary act in terms of a State having to bail those out. It is very important we do not have a retrospective narrative that somehow we did public expenditure before and it all went wrong. That is not the case. We need to be clear on the history.

We also need to be clear on the fact that others have learned that we do need stimulus. I recognise that there are steps towards stimulus in the budget but we need to look at valuing that stimulus in a crucial way. We know that the EU has suspended some of its fiscal rules for the coming two-year period. That is not indefinitely but those are two years in which some of the issues we always hear about such as something having to be off-balance sheet or on-balance sheet are allowing for large-scale transformative public expenditure. This is a chance not simply for the public expenditure we need to respond to the crises in terms of Covid-19 or Brexit but to remake our public expenditure in a way that prepares us for the future climate crisis. In this budget and, crucially, in the next one, we have an opportunity to operate outside some of the constraints we faced previously in terms of having resilient public services, hiring enough public servants and having systems that will carry us into the very challenging decade ahead.To what extent will that vision, and the recognising of the need for front-loading action during the suspension of the fiscal rules, be reflected in the national economic plan? To what extent has the Minister applied the principles of equality-proofing and gender-proofing to his section of the budget? I refer not simply to public expenditure but to those other aspects of the budget. To what extent will those commitments to equality-proofing and gender-proofing be reflected in the national economic plan? To what extent will the sustainable development goals, and the very micro and specific targets we have signed up to in regard to them, be reflected in the national economic plan? Even the European Investment Bank, for example, recognises that the sustainable development goals need to be integrated.

Will the Minister clarify the relationship between the proposed recovery fund and the EU recovery fund? Is this where we can expect that portion of the recovery fund from Europe to be routed through? The recovery fund is not simply an opportunity to support business. That is important, but not everything can be done through business, as we saw in our Covid-19 response. Sometimes it is about public employment, public services or public infrastructure, and the State as an employer and a driver of the economy, not simply supporting business to drive the economy but in itself as an innovator and creator of economic action.

There are concerns about a K-shaped recovery. We do not want to see headlines where the economy recovers but jobs do not. That is the fear and the danger if we do not approach this correctly. We were told, when the Financial Provisions (Covid-19) (No. 2) Bill 2020 and the Credit Guarantee (Amendment) Bill 2020 were moving through the House, that increased public expenditure would be clear and forthcoming. We have heard something about transport but I have concerns about housing. Short-term leasing was what was used ten years ago and it has given us problems now. How can we ensure there is not just leasing but also building of public housing? They are questions for the Minister for Public Expenditure and Reform.

I am concerned about climate action. Will the Minister, Deputy Donohoe, clarify that it is not his understanding that climate action and retrofitting must come from the climate action fund and that other resources within the financial budget will be dedicated to issues such as the rewetting of bogs and retrofitting? We do not want to set a constraint that there is only one well from which climate action can be drawn.

We spoke about the impact of Covid-19 on young people. I worked with rural young unemployed people during the previous crisis. Unemployment is a key issue but it is not simply about work. There are also youth services. The mistake of cutbacks on community development services and youth services in the previous recession had a very damaging impact. We need to learn from and avoid that. Similarly, there are measures in the budget to prevent people from falling into poverty, but those who are already in poverty are not as protected as they should be. I am concerned about renters, as well as those who are at high risk of poverty or in consistent poverty.

I would appreciate the Minister's response to these issues. I apologise that I must step away to the Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach, but I will read his contributions with great interest.