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Dáil
‹ Leaders' Questions

CSO growth figures and funding

Summary

Deputy Troy criticises the CSO’s 26.3% growth figure and seeks revised data methods, while questioning its implications for health-service funding and home-care packages. The Tánaiste defends the CSO’s independence and says increased investment will support services.

Last week, the CSO published a report that showed Ireland's growth rate surging to 26.3% in 2015. It made a mockery of Ireland and was described as leprechaun economics by the Nobel Prize winner Paul Krugman. The publication of this report makes no sense, in particular because of the reputational damage it has caused.

Last week, Deputy Micheál Martin called for the data collection methods to be changed and for a proper and fair assessment to be carried out to prevent something like this ever happening again. Is the Government taking that request on board?

The growth rate of 26.3% shows us having a growth rate four times that of China and comes only weeks after the Minister for Finance, Deputy Michael Noonan, said in his summer economic statement that the growth rate this year would be between 5% and 6%. We have to acknowledge that there is economic growth, but it is still very much a two-tier recovery. Large parts of the country have seen no recovery and many people watching today have not felt the benefit of any economic recovery.

We now face the extra challenge of Brexit. The UK has already announced its plans to reduce corporation tax to 15%, and today's newspapers refer to the UK abolishing corporation tax when it is outside of the EU.

That the extra €280 million obligation comes on the back of a report that bore no relation to Ireland's economic growth is absolutely galling. Public services are stretched beyond all limits. The country still has 2,100 children and their families who are without homes and are staying in hostels. Home help hours have been slashed. People with disabilities cannot get access to personal assistants.

It is mind-boggling, to say the least, that this report was published. It was compared to the works of James Joyce and Flann O'Brien in the Financial Times. As a result of this, it would appear that Ireland now has to increase its net contributions to the EU in the form of an extra €280 million. This was confirmed yesterday by the Minister for Finance in reply to a parliamentary question to my colleague, Deputy Michael McGrath. The €280 million requirement could have been spent on housing, health, education or justice. It is real cash and will have to be found in 2017. What impact will it have on our services? What budget will have to account for it?

Comment on this

Let me put the Deputy's points into context. It is important to remember that the CSO is independent and has commented on its figures and some processes it intends to examine further. We regularly discuss the independence of bodies in the House when they report on various issues. The CSO is an independent body that reports on figures.

The GDP figures released were affected by exceptional factors, which shows the complexity and difficulty of interpreting Irish macroeconomic data. Further work needs to be done on the interpretation of those figures. As a small economy, changes made by very large multinationals can have a dramatic affect on our headline statistics. As those statistics were one-off and exceptional in nature, we will not make economic policy on that basis. We will set policy on the basis of the more normal growth rates, such as those projected by the Department of Finance, in the region of 3.5% to 4%.

The Deputy used the word "slash". Nothing is being slashed. The Deputy mentioned home care and services for children. There is increased investment in every single area. We cannot deal overnight with some of the demands that exist, whether in the health services or other areas, but ongoing and detailed investment is now happening given the growth rates in the economy. More jobs are being announced almost every day. Of course the recovery has not reached everyone in the country, but let us reflect on the fact that the macroeconomic figures are good for the country. Despite the challenge of Brexit and other potential shocks, if we can keep that going the investment will continue.

The EU budget for 2017 has not been finalised. The European Commission presented a draft EU budget for 2017 in late June, but negotiations will continue until mid-November. The Minister confirmed the figure that may be owed, but all member states, including Ireland, benefit from the programmes funded through the EU budget. Ireland has been a net beneficiary in the order of more than €40 billion from the EU over the years.

The summer economic statement sets the fiscal space. The available resources for 2017 are about €1 billion. That position remains the same, as it is fixed each spring. All EU member states do this in order that planning can begin for the budget without having to wait for the most up-to-date figures.

In terms of planning for services, they will not be impacted by the situation in which we find ourselves based on the CSO figures, which were exceptional. There is ongoing economic growth. There are improvements in the taxes that are being collected. We stick by the fiscal space that is available for investment in services and reductions in tax.

Comment on this

The Government cannot pull the wool over people's eyes. We had enough of that with the CSO report. Even the Governor of the Central Bank did not accept the report.

I again ask whether the Government will accede to the request of Deputy Martin last week to change how data are collected and have a proper assessment of the figures. Is the Tánaiste saying that this money will not have to be paid to the EU? Is she contradicting what her colleague, the Minister for Finance, said in reply to a parliamentary question?

I refer to services. The Tánaiste must not have heard "Morning Ireland" today. A woman spoke on the programme about how both her parents suffer from dementia but their home help hours were cut from 20 to four. That is a fact.

I have provided the Minister of State with responsibility for disabilities copious examples of people who are living in their own homes and for whom home care packages have been sanctioned, yet who have been informed that the necessary resources are not in place to deliver services. Longford-Westmeath is one example. If a person dies and his or her home help hours are returned, only 25% of the hours are relocated. In any person's terms, that is a cut in services. What impact will the €280 million obligation have on services for the people we are honoured to represent in the House?

Comment on this

It will not have any impact on the services because what is very clear, in particular in relation to dementia, is that there is a very strong commitment to increased investment. That is partly driven by the agreement between the Department of Health, the HSE and Atlantic Philanthropies, which represented a combined investment of €27.5 million. Just some weeks ago a total of €500 million was agreed in extra investment in the health service and part of that is intended to support further home care packages. That is laid out very clearly. The Minister for Health and the Ministers of State in the Department of Health have indicated that home care packages will be increased but it will take time to roll out the process. I heard the story on "Morning Ireland" this morning. I am sure the Minister will investigate what precisely has happened in that situation, given the needs of the woman in question.

Comment on this

She is one of thousands.

Comment on this

The reality is that there is now further investment. The money is available and is being given as a priority to the Department of Health to increase home care packages. That is one of the specific goals within the increased investment. That will become more obvious in the weeks and months ahead. Because the economy is growing and we took the right decisions there is further investment in the health service and citizens will get the benefit of that as time goes on.

Comment on this

The money must come from somewhere.

Comment on this

Where is the money to come from?

Comment on this