Róisín Shortall (Dublin North West, Social Democrats)
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73. To ask the Minister for Finance if he will provide an outline of the process by which decisions will be made on how the projected windfall revenues from corporation tax will be spent; and if he will make a statement on the matter. [25033/23]

Róisín Shortall (Dublin North West, Social Democrats)
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74. To ask the Minister for Finance if there are any plans for broad consultation with different civil and political stakeholders on how the projected windfall revenues from corporation tax will be spent; and if he will make a statement on the matter. [25034/23]

Michael McGrath (Cork South Central, Fianna Fail)
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I propose to take Questions Nos. 73 and 74 together.

On May 10, my Department published a scoping paper entitled ‘Future-proofing the Public Finances – the Next Steps’. The paper outlines the pros and cons around the establishment of a long-term public savings vehicle.

The paper addresses two key policy questions facing Government at present. On the revenue side, recent years have seen extraordinary growth in corporation tax receipts. However, as these receipts are potentially windfall in nature, there is a need to avoid building up permanent fiscal commitments on the basis of transitory revenue streams. On the expenditure side, there are major fiscal challenges on the horizon, including the costs of an ageing population, the shift to climate neutrality, and the digital transition.

The scoping paper outlines some of the options available to Government to help to mitigate against these risks to the public finances. The paper considers different approaches to using the windfall receipts, including putting them towards a new long-term savings vehicle, and using a portion to pay down debt and for additional, targeted capital investment.

In doing so, the paper also takes into account the views of different institutional experts, with the positions of the Irish Fiscal Advisory Council, the Central Bank of Ireland, the National Economic and Social Council, the OECD and the IMF all considered. There is broad support for the establishment of a long-term savings vehicle and recognition of the need to address the future increase in ageing-related expenditure.

Taking into account this analysis, it is my intention to bring forward proposals for a long-term savings vehicle which will be used to pre-fund part of the future costs of structural change. Subject to government approval, setting up such a long-term savings vehicle will require primary legislation. This process has been set in motion, but remains at an early stage.