asked the Minister for Finance if the expected balance of payments deficit in 1979 will influence the performance of the IR£ in the EMS.

The performance to date of the IR£ within the EMS has been satisfactory and it is not considered that the balance of payments deficit in 1979 will adversely affect the position.

Does the Minister accept that the forecast of the £600 million deficit in the balance of payments was made by a reputable source and do the Department accept that deficit?

As the Deputy is probably aware, the latest published estimate was in the Economic Review and Outlook in the summer of this year, which estimated the figure at £500 million.

It has gone up since.

That was the estimate in mid-summer. I anticipate that the deficit will be higher than that.

Over £600 million?

I am not prepared to put a precise figure on it, but it will be higher than £500 million.

A figure of £100 million here is peanuts to what we are talking about. Will the Minister agree that in either event it will be a record deficit, and will he further agree that it is an axiom of such matters that one's balance of payments has an immediate relation to the question of the value and the status of one's currency?

Question No. 4.

I would point out to Deputy Kelly that the deficit in the current balance of payments is only one aspect of it and that in so far as the reserve and the state of the country's currency is concerned, it is the overall position of the balance of payments that counts, including capital inflow. The Deputy may be aware that in the case, for instance, of the EEC, because of the increase in the price of oil there will be a deficit in the Community on the current side. In fact, there will be a deficit in every country except in Italy, brought about to a considerable extent by the increase in the price of oil.

Would the Minister agree that capital inflow will not be encouraged by the rising inflation rate here which is giving us a very uncomfortable lead in the EEC?

Would the Minister agree that the deficit as a percentage of GNP would probably be twice as high as in any other country in the EEC?

Question No. 4.

The silence is eloquent.