In a report published this morning, the Economic and Social Research Institute, ESRI, showed that young people are at a particular disadvantage as a result of having multiple quality of life issues, including overcrowding, financial issues and so forth, while a survey by the Irish League of Credit Unions indicates that many families find it very difficult to afford the costs of children going back to school. When one compares that with the Central Statistics Office, CSO, figures relating to Irish economic growth which state that the Irish economy grew by a staggering 26% in 2015, one gets a real sense of the disconnect between the official figures and the reality for ordinary working people as depicted by the ESRI and the Irish League of Credit Unions.
The CSO figures are not a bolt from the blue in the sense that we have known for some time that we do not have a proper, accurate statistical model for calculating the actual size of the Irish economy. This has very serious impacts, including on our budget planning, investment policies and our fiscal strategy. At a stroke it undermines fiscal rules and the fiscal treaty, because nobody believes the figures. Mr. Paul Krugman, the Nobel laureate, has described it as leprechaun economics. Mr. Philip Lane of the Central Bank apparently went to the CSO last Monday to tell it that the figures are not real and do not accurately reflect the size of the Irish economy. There is economic growth, but clearly it is not in the order of 26%. As one economist said, I believe it was Mr. Tom Healy of the Nevin Economic Research Institute, NERI, even the Soviet Russia in the 1930s did not publish statistics of that scale. Others have also commented on the farcical nature of these figures. This damages Ireland's international reputation.
As I said, this should not have been a surprise, although the scale of it has been. However, we have known for some time that our capacity to reflect our economic growth accurately has been impaired. Consider the budget figures of the past two to three years and the accompanying documentation. Hidden in the documentation was an acknowledgement by the Department of Finance that it could not explain tax buoyancy, particularly corporate tax buoyancy.