Dan Neville
Question:12 Mr. Neville asked the Minister for Finance if he has commissioned any study on the impact of the release of funds under the SSIA scheme; and if he will make a statement on the matter. [24627/04]
View answerThursday, 14 October 2004
Questions (13)
Written answers
The SSIA scheme opened on 1 May 2001 and entry to it closed on 30 April 2002. The accounts are due to mature between May 2006 and April 2007 at the end of the five year period. A total of 1.17 million accounts were opened during the period outlined; approximately 400,000 accounts existed at 31 December 2001.
The impact of such maturing funds on consumer demand in 2006 and 2007 is difficult to estimate and will depend on how the accumulated SSIA savings are spent or saved, how that portion of an individual's income that was previously saved in SSIAs is used and the extent to which savings are rolled over into other investment products. To date, two reports have been carried out on the impact of the SSIAs, one by Goodbody stockbrokers and one by Lansdowne Market Research. However, there is no consensus in these reports as to how these funds may be used, with both reaching differing conclusions regarding the division between consumption and saving. The ESRI, in its autumn bulletin, does not hypothesise about the likely impact on the economy of the release of SSIA funds because it believes there are too many uncertainties around the likely behaviour of fund recipients.
I have not commissioned a specific study on the impact of the release of the funds. My Department is keeping the issue under review in the context of the normal assessment of the economic and budgetary position going forward. However, it is important to emphasise that, as the scheme will not commence to mature for another two years, there are many uncertainties regarding the maturity of the SSIAs, which makes the task of analysing the impact particularly difficult.