Bernard Durkan (Kildare North, Fine Gael)
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62. To ask the Minister for Finance the extent to which his Department has put in place appropriate measures to minimise the impact of Brexit on the financial services here and the economy in general; and if he will make a statement on the matter. [51310/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Department has been assessing and preparing for the impact of Brexit since well before the UK referendum in June 2016, with this work now intensified. The Department’s preparation and contingency work is ongoing and continues to examine all possible scenarios and challenges, and is a key input into the whole of Government approach.

Regarding the economic impact, we know from our own published research that the potential impact on the Irish economy is significant.  In that regard, the Government has taken a number of important steps to prepare our economy for the challenges of Brexit, including in Budgets 2017 and 2018, the Action Plan for Jobs and our Trade and Investment Strategy. A new 10-year Capital Plan is also in preparation.

The best and most immediate policy under the Government's control to counter the likely negative economic impacts of Brexit is to prudently manage the public finances in order to ensure that Ireland's economy continues to remain competitive in the face of future economic headwinds.  In that context, on the fiscal side, the Government has continued its policy focus of enhancing the resilience of our public finances to any Brexit-related shock. Specifically, it is projected that Ireland will achieve its medium-term budgetary objective of a balanced budget next year. Linked to this, over the forecast horizon, it is projected that the General Government Debt-to-GDP ratio will continue on a downward trajectory, reaching the Stability and Growth Pact (SGP) 60 per cent threshold in the early part of the next decade and continuing to improve thereafter. Whilst not complacent to potential challenges, including our currently elevated debt level, these developments will help provide fiscal capacity in the event of Brexit. Complementing this, Budget 2018 further established the ‘Rainy Day Fund’, which provides an additional counter-cyclical buffer, and represents an important measure to strengthen the shock absorption capacity of the national finances to such external risks.

As part of its contingency planning, the Department is engaged on an ongoing basis in examining the potential impacts of Brexit on the financial services sector and potential mitigations.  As part of this work the Department liaises with other Government Departments and Agencies who have responsibilities in this area, including Enterprise Ireland and the IDA. The Department also engages closely, via the Financial Stability Group with the Central Bank of Ireland, which has the statutory responsibility for financial stability.  Brexit is a standing item on the Group’s agenda. In undertaking its statutory role, the Central Bank continues to engage with financial firms to ensure that appropriate contingency measures are in place to address issues relating to Brexit and to set out the responsibility on firms to take preparatory actions in advance of Brexit.

Additionally, the Government’s strategy to mitigate the impact of Brexit includes fully exploiting opportunities arising.  With regard to the Financial Services sector, Brexit will provide opportunities for Ireland to increase its share of financial services based inward investment. In that regard, Minister of State Michael D’Arcy T.D. has responsibility for Financial Services, including the implementation of the IFS2020 Strategy for driving growth in the financial services sector.