Dáil Éireann Debate, Wednesday - 5 July 2017
83. Deputy Michael Healy-Rae asked the Minister for Finance his plans to prioritise investment in public services over tax cuts as requested by a group (details supplied) in budget 2018; and if he will make a statement on the matter. [31736/17]
View answerAs the Deputy is aware this Government must ensure that budgetary policy is in compliance with the fiscal rules - formally known as the Stability and Growth Pact (SGP) – which have direct application through a number of EU regulations as well as domestically via the Fiscal Responsibility Act 2012. These rules are designed to promote budgetary discipline and underpin sustainable economic growth. While Ireland's economy is growing and debt is on a downward trajectory, the debt level is still comparably high and caution must be exercised due to the potential of rollover risk should interest rates increase . We are a small and very open economy in a world that has more risks than usual. Compliance with the fiscal rules underpins the Government’s objective of maintaining sound public finances. The answer, therefore, is not simply about spending more; it is about getting more from each euro of taxpayers' money that is spent.
Having said this the Government is increasing expenditure in line with the levels permitted by the fiscal rules where possible, particularly in the area of increasing public funding for capital investment in order to meet key infrastructural requirements in areas such as housing, transport, broadband, education, health and flood defences. The recent European Commission 2017 Country Report for Ireland noted that the share of public investment in Government expenditure is expected to grow to close to 8.6% by 2021, up from 5.8% in 2015, well above the euro area average.
The Programme for a Partnership Government committed to additional capital investment over the period of the Capital Plan to 2021, to be allocated on the basis of the outcome of the ongoing review of the Capital Plan. It is expected that the capital review process will be completed in Quarter 3 of 2017, to enable the Government to make final decisions in the context of the Budget on how the additional capital funding should be allocated.
I would also note also that in the run-up to the Budget it is typical to receive a number of submissions from a wide variety of groups, representative organisations and individuals. All such submissions received are recorded and distributed as appropriate, in both the Department of Finance and of Public Expenditure and Reform, so that their content may be considered in the context of Budget and Finance Bill preparation.
