Michael D'Arcy (Wexford, Fine Gael)
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Question 55: To ask the Tánaiste and Minister for Finance his views on the concerns expressed by the EU Commission about the deterioration in the public finances. [7783/08]

Arthur Morgan (Louth, Sinn Fein)
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Question 62: To ask the Tánaiste and Minister for Finance his views on the warning from the European Commission in its annual report on the Irish economy under the Stability and Growth Pact, that the Government faces several economic challenges and a noticeable deterioration in its budgetary position in coming years. [7689/08]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I propose to take Questions Nos. 55 and 62 together.

The European Commission's assessment represents a reasonable view of the Irish economy. While it refers to the challenges of a "transition to a period of lower economic growth, mainly linked to a return to more sustainable activity in the housing sector", it also acknowledges the overall strong position of the public finances.

Ireland is in full compliance with the Stability and Growth Pact requirements and the Government is committed to respecting the terms of the Pact as the economy adjusts to a period of slower growth.

Notwithstanding the challenges, we must not lose sight of the fact that our overall growth performance of the order of 3 per cent for this year is still impressive by international standards. Furthermore, those that have produced forecasts for 2009 and 2010, expect our growth prospects to pick up in these years.

The Government accepts that there can be no unnecessary loosening of fiscal policy and, in that context, the implementation of the National Development Plan remains a key priority. It will help boost the productive capacity of the economy and lay the foundations for future growth.

Ireland has recorded surpluses on the public finances in ten of the last eleven years and we have one of the lowest levels of public debt in the EU. The maintenance of stable public finances remains the cornerstone of Irish economic policy supported by a tax system which will remain conducive to enterprise and investment.