John Perry
Question:29 Mr. Perry asked the Minister for Finance the commitments he has made to ECOFIN regarding the control of public expenditure for the remainder of 1998; and if he will make a statement on the matter. [13639/98]
Other Questions. - Public Expenditure.
The communiqué issued on behalf of EU Finance Ministers and Central Bank Governors following the meeting on 14 March 1998, at which the revaluation of the Irish pound's central rate in the ERM was decided, included the following statement:
The ministers and governors noted the firm resolve of the Irish authorities not to exceed the expenditure commitments in the 1998 budget and to ensure that any revenues above those anticipated in that budget are used to raise the primary surplus, and thus the general government surplus, above the planned figures.
Furthermore, the Commission's recommendation for the broad guidelines of the economic policies of the member states and the Community, a revised text of which was unanimously agreed at the meeting of ECOFIN on Friday, 5 June 1998, states that "in view of the present strong growth of the [Irish] economy and the possibility of overheating, any revenues received over and above those anticipated in the 1998 budget should be used to raise the budget surplus. Moreover, a tight fiscal stance is required in Ireland to reduce the risk of overheating".
Both the broad economic guidelines and the communiqué acknowledged the Government's commitment to a budgetary strategy geared towards maintaining stable, non-inflationary growth. I intend to deliver fully on this commitment. Along with the revaluation of the Irish pound, the Government's policy on spending will help to ensure that any unwelcome additions to demand and inflationary pressures in the economy are avoided.
In relation to 1998 expenditure, I will continue to monitor the position closely during the year. In consultation with my Cabinet colleagues, I will aim to ensure that expenditure is managed in accordance with the Government's overall budgetary strategy and the requirements of EMU membership. My statement on the end of March Exchequer returns said that spending in the first quarter was broadly in line with expectations.
Does that commitment imply that there will be no Supplementary Estimates in 1998? With regard to the ECOFIN meeting, I understand that arrangements have been made for the Minister to set the outline of his budget before ECOFIN on 1 July this year. What arrangements will the Minister make to inform the House, in advance of putting that information before ECOFIN, of the details of the budget or even the broad aggregates, which ECOFIN is keen to monitor?
It is too early to say if there will or will not be Supplementary Estimates. It is the desire of every Minister for Finance to ensure that there will be no such Estimates but, as the Deputy is aware, it is not always possible to plan in that regard.
We have not been given a commitment like this.
It is too early to give an indication of the position on Supplementary Estimates. I intend to keep net current spending in line with the commitment given in the programme An Action Plan for the Millennium.
As regards the ECOFIN meeting in July, more detailed surveillance of budgetary strategies of all member states will be discussed by the Commission and ECOFIN. It is intended this will go further when monetary union takes place on 1 January next. A broad outline of the overall budgetary parameters will be given at July's meeting. The commitments have already been given, as announced in the communiqué in March and repeated last week in the broad economic guidelines. Those are the parameters within which we will work.
I wish to refer to an earlier question. Can the Minister say that none of his predecessors would have in their possession any of those 130 missing files to which he referred earlier?
The Minister has taken us into the first 11 — an auspicious number on the day that is in it — and the special 11 in terms of European financial Ministers. However, what happened yesterday at the European Central Bank in relation to monetary policy was a disaster for this country and the Minister must be held responsible. An Irish person will not hold one of the senior 23 positions in the European Central Bank. Our governor will only be a non-executive director.
We are talking about fiscal policy, the fact that the Irish economy is being constrained and out of step with the other EMU economies. In that context it is critical that there be an Irish representative at the highest level of European monetary policy. The Irish Government has failed disastrously to ensure that our interests are at the front of European monetary policy. The Taoiseach said he had no responsibility for this.
The Deputy is making a statement, not asking a question. The first part of the Deputy's question is out of order as it is not appropriate to ask supplementaries on a priority question submitted by another Member.
Deputy Broughan asked some interesting questions which had little to do with the question put down by Deputy Perry on the commitments on the control of public expenditure for the remainder of 1998.
On the question of files, I would be a brave individual to say what has gone on in the Department of Finance for the past 60 or 70 years. I cannot give any commitment in that regard.
Does the Minister accept that a recent former Minister had a number of files in his possession?
Is the Deputy talking about Deputy Quinn?
No.
He is my most recent predecessor. Deputy Richard Bruton's brother was also one of my predecessors — perhaps it is him to whom Deputy Broughan is referring.
As regards the appointments to the European Central Bank, the Irish Government had to submit the Central Bank Bill before the European Monetary Institute. Changes had to be made on Committee Stage to ensure there would not be a hint of influence regarding the European Central Bank. Appointments to the European Central Bank are a matter for the bank. It has nothing to do with the Minister for Finance, the Taoiseach or anyone else.
I do not believe the Minister.
To repeat what the Taoiseach said this morning, of the 55 positions, to use sporting parlance, 49 are transfers from the European Monetary Institute. Of the six extra appointees, three are governor alternates in the European Monetary Institute. Another person was appointed as a press officer and as the European Central Bank will be in Frankfurt, he is German. Another appointee is a professor of economics and is the chairman of the alternates of the monetary committee. The last appointee is from Finland and an expert on banknotes.
The matter raised by Deputy De Rossa this morning is a complete red herring, as Deputy Richard Bruton knows more than anyone else. I have answered Deputy Broughan's questions and I apologise for being out of order.