Wednesday, 13 November 2019

Questions (93)

Bernard Durkan


93. Deputy Bernard J. Durkan asked the Minister for Finance if, in the aftermath of Brexit, he remains satisfied that Ireland is adequately protected in the event of currency fluctuations; and if he will make a statement on the matter. [46874/19]

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Written answers (Question to Finance)

Budget 2020, including the macroeconomic outlook which underpins it, was based on the prudent assumption that the UK would leave the EU on 31 October without an agreement. The macroeconomic outlook is set out in the Economic and Fiscal Outlook published with Budget 2020. The euro-sterling exchange rate assumptions underlying Budget 2020, based on exchange rate outturns as of mid-September 2020 and unchanged thereafter, are set out in Table 1:

Table 1: Euro-sterling exchange rate assumptions underlying Budget 2020









Euro-sterling exchange rate (€1=)








Source: Budget 2020 Economic and Fiscal Outlook

In the event of a disorderly Brexit, the Government will provide financial support to the economy, in the first instance through higher unemployment-related spending. The Government will also provide timely targeted support to viable firms and enterprises. This will build on existing supports, and will be designed to address transitional issues such as cash-flow problems and market diversification.

As we cannot control the international environment or exchange rate developments, it is crucially important that continued competitiveness improvements are achieved, including by focusing on costs we can control and by boosting our productivity. Ensuring a sustainable path for the public finances is also of fundamental importance.

The Government’s trade strategy - Ireland Connected - sets out a number of measures specifically addressing Brexit-related issues, including diversification of markets for indigenous exporters.

In addition, recent budgets have introduced specific initiatives, such as loan supports for agri-businesses, aimed at supporting those businesses most affected by Brexit. The Brexit Loan Scheme assists firms to adapt and innovate in response to Brexit, to restructure their cost bases and give them the opportunity to diversify into other markets thereby reducing their exposure to the UK. The Future Growth Loan Scheme provides a longer-term facility of up to €300m to support strategic capital investment for a post-Brexit environment by business at competitive rates.