Eamon Gilmore (Dún Laoghaire, Labour)
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Question 28: To ask the Minister for Finance his views on a fiscal stimulus package to jump-start the Irish economy; and if he will make a statement on the matter. [45355/08]

Brian O'Shea (Waterford, Labour)
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Question 71: To ask the Minister for Finance if he proposes measures to boost consumer spending to avoid the risk of a deflationary spiral; and if he will make a statement on the matter. [45356/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I propose to take Questions Nos. 28 and 71 together.

In common with virtually all the world's advanced economies, Ireland is facing substantial economic and fiscal challenges in the immediate future. Ireland, however, is particularly badly affected and our scope to have a further fiscal stimulus on top of what we are already doing is extremely limited.

Our first priority must be to stabilise and to restore the public finances to good order by bringing our current budgetary position back to balance over the medium term. This we will do while continuing to commit substantial funding to public investment to secure the future growth potential of the economy and maintain employment and competitiveness. This will then underpin international confidence in Ireland as a place to work and invest.

Furthermore, we are maintaining public investment at about 5% of GNP which is equivalent to almost twice the EU average. This means that we are planning to borrow over €8 billion next year to continue to provide essential infrastructure such as roads, schools, public transport and water treatment projects. This investment represents a significant fiscal package and it supports employment in the short term and increases our productivity in the long term.

For a small, open economy such as ours, sustainable increases in living standards can only be achieved by supplying goods and services to the wider global economy. Therefore, we must also ensure the economy is in a position to take advantage of the global recovery when this emerges. Among other things, this will require a greater focus on competitiveness. To support our competitiveness objectives, the Government is committed to maintaining a low burden of taxation on capital and labour and has implemented a range of policies aimed at improving competition in product markets and flexibility in the labour market.

In addition, the recently published Finance Bill sets out a number of measures that are targeted at the enterprise and environment sectors, such as the R&D tax credit changes and the extension to the categories of technology qualifying under the accelerated capital allowances scheme for energy efficient equipment.