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National Development Plan

Dáil Éireann Debate, Tuesday - 16 November 2021

Tuesday, 16 November 2021

Questions (91, 101)

Joe Flaherty

Question:

91. Deputy Joe Flaherty asked the Minister for Public Expenditure and Reform his assessment of the likely impact of the revised national development plan on employment; and if he will make a statement on the matter. [55880/21]

View answer

Joe Flaherty

Question:

101. Deputy Joe Flaherty asked the Minister for Public Expenditure and Reform his assessment of the likely impact of the revised national development plan on output and productivity; and if he will make a statement on the matter. [55881/21]

View answer

Written answers

I propose to take Questions Nos. 91 and 101 together.

As part of the review of the National Development Plan my Department carried out work to examine the likely impact of the investment on employment, output and productivity. A summary of this work can be found in chapter two of the new NDP which is titled “Benefits of Investment”.

Using the Economic and Social Research Institute’s COSMO model, it was possible to project the economic impact of the planned increases in public investment.

The COSMO model projects that employment will increase by 3 per cent more by 2030 compared to a scenario where investment remained constant at 2021 levels. It is important to note that in 2021, core Exchequer capital expenditure in Ireland is €9.7 billion, the highest level in the history of the state. For the construction sector specifically, an assessment published alongside the NDP estimates that an annual average of up to 80,754 direct and indirect construction jobs will be sustained as a result of public investment over the period 2021 to 2030.

The COSMO model also projects that GDP or output at basic prices is set to increase by 1.6 per cent more by 2030 compared to a scenario where investment remained constant at 2021 levels. Potential output, which captures the underlying growth of productivity, is set to increase by approximately 2 per cent compared to the scenario where investment remained constant at 2021 levels. Furthermore, an analysis carried out by my Department estimates that, of the €165 billion investment plan, approximately €104 billion is related to direct spending on construction. This direct construction spending of €104 billion will in turn have a multiplier effect. An additional €60 billion of output is projected to be generated indirectly through the construction supply chain.

It is important to note that while these results are based on robust and sophisticated modelling, the results are accompanied by caveats and limitations.

Having said that, it is clear from the substantive analysis and evidence base created by my Department that we as a country can expect significant benefits, from the investment planned under the NDP over the coming years. Indeed, nine specific and tangible case studies of project recently completed throughout the country were also provided in chapter two of the NDP.

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