Seanad debates

Wednesday, 13 October 2021

Budget 2022: Statements (Resumed)


10:30 am

Photo of Alice-Mary HigginsAlice-Mary Higgins (Independent)

I thank Senator Lombard. People have used the phrase "missed opportunity" a lot to describe this budget. It seems like a cliché, but it is true. This was an unusual budget and we had an unusual opportunity. This was the budget in which the fiscal rules and constraints that have often blocked us from long-term thinking and investment were suspended. As Senator Ardagh said, this was done in recognition that the pandemic exposed that our public services, national infrastructure and social fabric had been strained by years of austerity and the need for states to invest in order to become more resilient. That is why the fiscal rules on limiting expenditure were suspended. It is why we have recovery and resilience funding. However, it is clear that this Government has chosen to act as if the fiscal rules are still in place. We know that the Minister for Finance, Deputy Paschal Donohoe, is a strong advocate of bringing them back as quickly as possible at EU level.

We had a window of opportunity. The effort seems to have been put into closing it, rather than seizing it. One example of why that is bad economics and bad spending is the fact that we still have 2,600 houses being provided for by leasing and leasing schemes. The Department of Housing, Local Government and Heritage stated it only uses these leasing schemes because it is forced to do so by the fiscal rules on the government balance sheet. Those rules do not apply at the moment, yet in this budget €1.37 billion is going towards 2,600 houses in leasing schemes. This ties us to a bad deal for the State in the long run. That is not prudent. Applying licks of paint when we need to deal with dry rot or create structural transformation is also not prudent.

On the recovery and resilience funding, which is linked to this, €120 million on retrofitting is a pittance. To be clear, we need massive changes on this. We know energy costs will go up because they must go up. They have been subsidised globally and the costs of oil and gas are being felt across the world in climate change. However, retrofitting needs to be funded. The Government had resilience money from Europe for public investment and it was not alone in that regard. However, it chose to direct that money into the banks to encourage them to give loans for retrofitting, rather than delivering direct retrofitting. The Government is using the Department of the Environment, Climate and Communications as an example of its retrofitting of public buildings.

The Government should not have produced this budget. It should have piloted measures that we know work. This was a budget to be used not for incremental schemes but for transformation. Measures that cost us money for no reason are still in the budget, including the schemes for special assignee employees which offer massive tax breaks. We randomly decided that we do not need Ulster Bank to pay the bank levy next year because it is leaving Ireland. Are we rewarding Ulster Bank for leaving the State and closing branches? Those expenditure choices are not being questioned, yet the Government has taken a nickel-and-dime approach to things we actually need.

I hate to correct Senator Eugene Murphy, but Mental Health Reform has made clear that we need €85 million in investment. While €37 million is a start-----


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