Léim ar aghaidh chuig an bpríomhábhar

Dáil Éireann díospóireacht -
Tuesday, 13 Nov 2012

Vol. 782 No. 3

Fiscal Responsibility Bill 2012: Report Stage (Resumed) and Final Stage

Our consideration of the Fiscal Responsibility Bill 2012 will resume on amendment No. 10. As amendment No. 10 has already been discussed with amendment No. 5, it cannot be discussed now.

I move amendment No. 10:

In page 7, lines 32 and 33, to delete all words from and including “outlining” in line 32 down to and including “failure” in line 33 and substitute the following:

“outlining the reasons it considers non-compliance with the budgetary rule to be in the best social and economic interests of the citizens and the State”.

Question, "That the words proposed to be deleted stand," put and declared carried.
Amendment declared lost.

I move amendment No. 11:

In page 8, between lines 15 and 16, to insert the following:

“(a) provide an assessment of whether the fiscal and budgetary policy of the Government is contributing to economic growth, job creation, the delivery of high quality public services, greater income equality, social inclusion and poverty reduction,”.

I have no intention of delaying the Bill at this stage. We thrashed out many of the issues involved on Committee Stage. We also debated some of the points raised in this amendment on Report Stage last week.

The amendment would require the fiscal advisory council to "provide an assessment of whether the fiscal and budgetary policy of the Government is contributing to economic growth, job creation, the delivery of high quality public services, greater income equality, social inclusion and poverty reduction". I previously stressed the importance of ensuring that economic analysis and proposals are not produced in a vacuum. There is a responsibility on politicians and others to weigh up the outcomes of the proposals they make. The fiscal advisory council has provided the Oireachtas and the public with a huge amount of detailed analysis and data. Even if I did not support its recommendations, I would say it fulfils a valuable function. It would be strengthened if it had a responsibility to outline the impact of policies on the aforementioned areas. It is important that any proposal to impose additional cuts is measured against a basket of indicators. That is why I propose the amendment.

I do not propose to accept the amendment. As Deputy Doherty noted, we thrashed this issue out on Committee Stage, but it is worth stating my position once again. The Fiscal Council has been established to address gaps in fiscal policy analysis and provide assessments and recommendations in regard to fiscal policy. Imposing a wide mandate on the council would require a much greater level of resources in terms of staff and budgetary allocations. Furthermore, expanding its mandate would be likely to impede its ability to fulfil its core functions, including those specified in the treaty. It is imperative that the council has the resources it needs to complete its core functions. Expanding its functions may stretch its resources to a point at which its attention is distracted from its primary role. We do not want this to happen. If other functions were to be assigned to the council, legislative amendments would be required. A number of bodies already supported by the State, such as the ESRI and the National Economic and Social Council, produce reports which consider all aspects of policy development, including social impacts.

I support the amendment. When this compact was first presented, the emphasis was almost entirely on debt and deficit reduction. These are the key targets defined in the treaty. However, pressure from popular opinion, protests and alternative analyses by economists has slowly but surely started to shift the powers that be from their sole focus on debt and deficit targets while ignoring the impact on economic growth, unemployment and public services. The Government has claimed that it is among the leading advocates in the European Union of emphasising growth and jobs in order to counterbalance the austerity required in meeting these targets. In developing the Fiscal Council's role, is it not reasonable to require it to consider the matters set out in the amendment? Even the IMF has now acknowledged that the impact of austerity was much worse than initially anticipated and that it will ultimately affect economic growth, thereby increasing the difficulty of meeting the very targets set out in the treaty. If growth does not occur we may not be able to meet the targets. In that context, it is reasonable to widen the role of the council to include a focus on the impact of financial and economic policies on these areas.

The resource argument is not compelling. The fiscal advisory council was at pains to tell us that its costs were not significant. I do not think its members receive any payments other than certain expenses. What are the resource implications of broadening its mandate or even bringing other organisations onto the council to offer a closer focus on growth and employment than the particular economists chosen by the Minister might bring? The amendment appears to be minimal in terms of expanding the council's mandate to include assessments of growth and employment. I do not see why the Minister cannot accept it.

The Deputy made these points previously. When one establishes an agency to do a particular job, it is advisable to let it do the job rather than treat it as an empty train carriage onto which other policy options can be loaded. The ESRI already evaluates the areas suggested by Deputy Doherty, as does the National Economic and Social Council.

The Fiscal Council has been instituted to do a particular job, which it is doing well. We had a committee debate at which Deputies, particularly Deputies Doherty and McGrath, said the Department of Finance should give fuller responses on its advice, and we have taken that advice on board. Our next publication will have a fuller response to the advice of the council. However, I am not taking this piece of advice on board, because the council has a particular job to do and I want to let it do it.

Amendment put and declared lost.

I move amendment No. 12:

In page 8, lines 28 and 29, to delete “in subsection (3)” and substitute “in any of its assessments”.

This is an amendment I raised on Committee Stage which required a fuller response from the Department to the advice of the Irish Fiscal Advisory Council. We noted that the advice in terms of budgetary matters and the adjustments had not been taken on board and I pointed out that the level of response was quite short. The amendment was intended to place an onus on the Minister, through legislation, to report. However, given that the Minister indicated on Committee Stage and again here that there would be a fuller response to the advice of the Fiscal Council in future, I do not intend to press this amendment.

As I said, we will have a fuller response. The Fiscal Council is independent and publishes its own report, but if the Opposition wants to debate the reports as they are issued, I have no problem with that. The arrangements can be made through the Whips.

I apologise, but I forgot to inform the House that amendments Nos. 12 and 13 would be discussed together.

Given the Minister's indication that fuller responses would be provided, I do not intend to press amendment No. 12. On amendment No. 13, the Minister said we could arrange this with the Whips, and that is fine. The Oireachtas Joint Committee on Finance, Public Expenditure and Reform already has discussions with the Fiscal Council on its reports. They are discussions, not debates - a significant difference.

This amendment would place an obligation on this Chamber to have debates on the reports of the council. The Fiscal Council would continue to issue reports as it has done in the past. The amendment would not oblige the House to have a debate on any of those reports, although we can have one if we so desire with the agreement of the Whips. The amendment is specific to section 8(3) of the Bill, which states that assessments issued by the Fiscal Council must state whether exceptional circumstances exist or no longer exist - which is significant, because the targets need not be met in exceptional circumstances; whether there is a failure to reach the targets as defined within section 6(1); or whether, during any period under the plan, progress is being made in accordance with the plan. Such a report would be big stuff. That is not to diminish any of the other reports the Fiscal Council would issue in the meantime. Its proposals on budgetary matters are significant. However, this is about complying with the legislation and with the treaty that has been passed in the State. It is not a routine report. Hopefully, this report will never need to be issued and we will not have to develop plans. I hope there will be growth in the economy and we will see these issues dealt with through those measures. However, in the event that exceptional circumstances do exist or that there is non-compliance with section 6(1) in the eyes of the Fiscal Council, it must issue a report. The provision states that if the Government agrees with the report, there will be no debate. However, if the Government disagrees with the report, it must, within two months of the report's publication, lay before the Dáil its assessment of why it does not agree.

This amendment is quite small. Basically, it suggests that given the significance of this, we should allow for a debate. I am the last person to want to tie the House up in debate after debate, but this would be in the event of a significant report from the Fiscal Council with regard to the core issue of the treaty and the legislation. The Minister is correct in stating that if the Whips get together and agree this it is fine, but where the advice is not complied with, which would put us in breach of the treaty obligations, there should be a debate in the House. That should be the norm.

We both know that if the Fiscal Council were to issue a report on these issues and the government of the day rejected it, a debate would take place. Any fair-minded person believes that is the case. However, we cannot predict a situation in which a future government might be in unique circumstances and might decide not to have a debate. This amendment just establishes a safeguard by providing that this House of the Oireachtas debate such a significant decision, given that such a report is being rejected by the government of the day despite the fact that it is core to the European obligations to which we signed up in the referendum. It is an amendment the Minister should consider agreeing to, perhaps when the Bill comes before the Seanad.

The Government is never reluctant to have a debate on any issue. If the Opposition wants to debate any particular Fiscal Council report, we will debate it. It stands to reason that a special report of a more crucial nature should take priority. We would be even more bound to debate that. However, the provision for a Dáil debate need not be written into every piece of legislation. Debate is the normal work of the Dáil and is arranged between the Whips. There is no issue.

As we teased out some of these matters on Committee Stage, I will not go into too much detail on this. With regard to amendments Nos. 12 and 13, I explained on Committee Stage that I do not expect the Department to respond point for point to everything in each report issued by the Fiscal Council. However, the Department should respond to the broad thrust of its report, particularly when it makes recommendations relating to fiscal consolidation - as it has done - over the next number of years. It recommends additional consolidation above and beyond what the Government plans currently. The Department should respond to this formally and set out its position.

The Minister said he intends to respond in more detail in future and I interpret that to mean that the medium-term fiscal statement which is due to be published will contain a more detailed response to the Fiscal Council. I am satisfied with that, provided it happens. I do not want the Department to be tied up in knots responding point for point to the council's report. The current wording of section 8(6), which requires the Minister to respond to the council's assessment if he does not agree with it, is unnecessarily restrictive. However, I take the Minister's comments on that in good faith. He has given a commitment that if we require any particular Fiscal Council report to be debated in the House, consent will be given. That is good enough for me.

I wish to make a brief final point. I accept the bona fides of the Minister in terms of debates of this nature. However, this Minister will not be here forever. A new government will take over at some point, whether the Minister likes it or not. Circumstances will change. The aim of this amendment is to include a safeguard that will provide for a debate, but it is not a die-in-a-ditch issue.

We have learned that advice was given to the previous Government. There were reports that issued warning signals. None of us can turn back the clock or say what would have happened if X, Y or Z had been done. If some of these reports had triggered an automatic debate in this Chamber, at least there would have been more scrutiny of the fact that the Government was not accepting the recommendations made in certain reports. It is not about the term in office of the current Government, rather it is about what will happen five, ten or 15 years down the road. Given that this legislation will be in place until it is repealed, I suggest this extra safeguard is needed. I do not think the Minister is completely opposed to this proposal. He has said the debate would take place anyway. I want to make sure the next Minister for Finance cannot take a contrary view. I do not propose to die in the ditch for the sake of this additional safeguard. However, in the light of the mess we have been in, it would be proper for us to ensure that when the report was laid before the Houses, it automatically triggered a debate in this Chamber.

I see a danger in this amendment. If we are to include a series of provisions in certain legislation because we think it is important that Dáil debates take place in certain circumstances, a future Government might decide it was free to refuse to hold a Dáil debate because a requirement to do so was not specifically written into the relevant legislation. If we write this provision into legislation as the Deputy proposes, there will be a risk to the freedom of the House and a particular risk to the Opposition when it seeks open debates on an issue it wishes to pursue.

I would like to respond briefly to the Minister. The Government's numbers give it the right to refuse to hold a debate. This is a significant matter which arises from a constitutional amendment. It is the central part of the legislation. The unique circumstances about which we would be talking - the Department ignoring the advice of a statutory body established under legislation on foot of a referendum result - would merit the automatic triggering of a debate in this Chamber.

Amendment, by leave, withdrawn.

I move amendment No. 13:

In page 8, line 31, after "it" to insert the following:

"and allow for a debate on the matter in the Dáil"

Amendment put and declared lost.

I move amendment No. 14:

In page 14, lines 10 to 11, to delete all words from and including "who" in line 10 down to and including "Council" in line 11 and substitute the following:

"who shall be the officer accountable for such accounts".

This technical amendment proposes to remove the references to "accounting officer" and "appropriation accounts" in paragraph 10(2) of the Schedule to the Bill, as these are defined legal terms under the Comptroller and Auditor General Acts 1866 to 1998 which do not apply to statutory bodies funded directly from the Central Fund. The corrected wording clarifies the references in order that these terms are removed. This minor amendment will ensure there is no confusion about this legal requirement and corrects a minor error.

Amendment agreed to.
Bill reported with amendment and received for final consideration.
Question proposed: "That the Bill do now pass."

My party opposes the passing of this legislation.

I thought Deputy Richard Boyd Barrett was going to vote with me this time.

Question put:
The Dáil divided: Tá, 90; Níl, 22.

  • Breen, Pat.
  • Burton, Joan.
  • Butler, Ray.
  • Buttimer, Jerry.
  • Byrne, Catherine.
  • Byrne, Eric.
  • Calleary, Dara.
  • Cannon, Ciarán.
  • Carey, Joe.
  • Coffey, Paudie.
  • Collins, Áine.
  • Conaghan, Michael.
  • Conlan, Seán.
  • Connaughton, Paul J.
  • Conway, Ciara.
  • Coonan, Noel.
  • Corcoran Kennedy, Marcella.
  • Coveney, Simon.
  • Cowen, Barry.
  • Creed, Michael.
  • Creighton, Lucinda.
  • Deasy, John.
  • Deering, Pat.
  • Doherty, Regina.
  • Donnelly, Stephen S.
  • Dooley, Timmy.
  • Dowds, Robert.
  • Durkan, Bernard J.
  • English, Damien.
  • Feighan, Frank.
  • Fitzpatrick, Peter.
  • Gilmore, Eamon.
  • Grealish, Noel.
  • Griffin, Brendan.
  • Hannigan, Dominic.
  • Harrington, Noel.
  • Harris, Simon.
  • Hayes, Tom.
  • Healy-Rae, Michael.
  • Heydon, Martin.
  • Hogan, Phil.
  • Humphreys, Heather.
  • Humphreys, Kevin.
  • Keating, Derek.
  • Keaveney, Colm.
  • Kehoe, Paul.
  • Kelleher, Billy.
  • Kelly, Alan.
  • Kenny, Enda.
  • Kenny, Seán.
  • Kitt, Michael P.
  • Kyne, Seán.
  • Lawlor, Anthony.
  • Lynch, Ciarán.
  • McCarthy, Michael.
  • McConalogue, Charlie.
  • McEntee, Shane.
  • McGinley, Dinny.
  • McGrath, Mattie.
  • McGrath, Michael.
  • McHugh, Joe.
  • McLoughlin, Tony.
  • McNamara, Michael.
  • Maloney, Eamonn.
  • Mathews, Peter.
  • Mitchell O'Connor, Mary.
  • Mulherin, Michelle.
  • Murphy, Dara.
  • Murphy, Eoghan.
  • Nash, Gerald.
  • Naughten, Denis.
  • Nolan, Derek.
  • Ó Cuív, Éamon.
  • Ó Fearghaíl, Seán.
  • O'Donnell, Kieran.
  • O'Donovan, Patrick.
  • O'Dowd, Fergus.
  • O'Mahony, John.
  • Phelan, Ann.
  • Phelan, John Paul.
  • Ring, Michael.
  • Shatter, Alan.
  • Smith, Brendan.
  • Spring, Arthur.
  • Stagg, Emmet.
  • Troy, Robert.
  • Tuffy, Joanna.
  • Twomey, Liam.
  • Walsh, Brian.
  • White, Alex.


  • Adams, Gerry.
  • Boyd Barrett, Richard.
  • Broughan, Thomas P.
  • Colreavy, Michael.
  • Crowe, Seán.
  • Doherty, Pearse.
  • Ellis, Dessie.
  • Flanagan, Luke 'Ming'.
  • Healy, Seamus.
  • Higgins, Joe.
  • McDonald, Mary Lou.
  • McGrath, Finian.
  • McLellan, Sandra.
  • Murphy, Catherine.
  • Ó Caoláin, Caoimhghín.
  • Ó Snodaigh, Aengus.
  • O'Brien, Jonathan.
  • O'Sullivan, Maureen.
  • Pringle, Thomas.
  • Ross, Shane.
  • Shortall, Róisín.
  • Stanley, Brian.
Tellers: Tá, Deputies Emmet Stagg and Paul Kehoe; Níl, Deputies Aengus Ó Snodaigh and Catherine Murphy.
Question declared carried.