The Minister for Finance's policies on the budget and the economy are not common sense. He has argued that it is common sense for Ireland to not spend as much money as is available to us and is permitted under the very strict European rules that we helped put in place. I said previously that we do need to manage and reduce the national debt. The most sensible way to do that is to expand the economy, as with a growing economy, the debt would become proportionately lower.

The economy is back on its feet and is growing again. That is how we overcame the crises in the 1990s. This State, as the Tánaiste has heard from many Members previously, has pressing social needs right now. Across the country people are waiting for the procedures about which Members have spoken. They are waiting to get access to general practitioner, GP, appointments because of the lack of rural doctors, which will become the next acute crisis for us. The south east, my own area, is facing the real risk of having no psychiatric services for children and adolescents at the end of this month at a time when Ireland's suicide rate for teens is among the highest in the European Union.

Every day I can identify the social needs that need to be met. Inaction in addressing these issues is not defensible. The State is not like a household or company in terms of saving money. A private household or company can save its money in a bank and the bank will reinvest it in the economy. The State is so large that inaction has as much effect as an action. If, as the Government proposes, the State does not spend €500 million and puts it in a rainy day fund, that is not a neutral action. It is a large dose of inaction that will shrink the economy in proportion and lower its future trajectory.

The Labour Party's hands were obviously tied in government by the scale of the national debt and the size of the deficit we faced in 2011. Following that painful period, the economy has grown rapidly and we have growing employment. If not now, when can the people of Ireland expect to see the necessary investment in all the social provision that every Deputy in this House could outline, including the Government's backbenchers? These services are necessary, not optional, to maintain both our social fabric and a growing economy. By creating the so-called rainy day fund, Government inaction will result in weaker public services and a permanent loss of the potential growth that spending could create.

If the €500 million rainy day fund is to be created rather than investing in all the social needs I and others have outlined, where will it go? Where will the rainy day fund be put?

I have heard the Deputy raise this question before. To be honest, I was a little surprised by his argumentation given his knowledge of what it is like to try to steer a country through a financial crisis. That is what Deputy Howlin had to do when he was Minister for Public Expenditure and Reform and, by the way, I think he did it very well. People forget very quickly what it is like when nobody is willing to lend us any money and we have to access emergency funds. Fianna Fáil knows what that is like due to the failures of its policy, which resulted in the IMF having to come to Ireland to put emergency funding in place. It seems like we are a long way from there now.

Next year, we are planning to spend an extra €3.4 billion in terms of the kind of service delivery the Deputy is asking for in housing, healthcare, transportation, education and so on. That is a massive increase in expenditure in one year. We are seeing a dramatic increase in capital expenditure in particular because we know there has been a deficit in expenditure for nearly a decade now.

Where is the rainy day fund being put?

The €3.4 billion is in our view what the country should be spending next year, recognising the fact that we now have a strong economy with the capacity to fund that kind of increased expenditure. However, we are not in the business of borrowing more money and increasing national debt at a time when we should be trying to reduce it so that if in the future the economy faces a shock to which the Government needs to respond, we do not have the kind of debt that fortunately we did not have when we had to respond to the last financial crisis the country had to deal with. Personal and national indebtedness are things we need to work on and we need to increase expenditure dramatically to make up for a lack of capital investment in particular in recent years and we are committed to doing that. Over the next ten years, we will spend €116 billion on a capital expenditure programme, going from spending considerably less than the European average to spending considerably more in that period.

I asked about the rainy day fund.

The €500 million rainy day fund is not part of that €3.4 billion. It is a prudent, sensible measure that has been recommended and supported in government to ensure that we do put some money aside in case we have shocks in the future to which the Government needs to respond in a responsible way.

The country has put money aside. Under the Ireland Strategic Investment Fund, there is €20 billion of directed and undirected funds available to the Minister for Finance. My question is directly about the rainy day fund.

The Minister for Finance has indicated that the forthcoming budget will involve the State borrowing to run a deficit of 0.1% of GDP. That is what he told the House last week. This will amount to between €250 million and €300 million. What is the economic logic of borrowing €250 million or €300 million to set it aside in a rainy day fund?

In his first question, Deputy Howlin was asking us to borrow a whole lot more.

I am asking for the Government's logic.

What we have been doing - Deputy Howlin had a part in the first half of this - is fixing an economy to ensure it is fit for purpose and we do not create bubbles in any of its sectors. We have been warned by many independent economists this year not to overspend or allow Ireland to fall back into a cycle of boom and bust, which, unfortunately, has happened repeatedly in recent Irish history. We will not overspend money or borrow just because we are allowed to do so under EU fiscal rules. Ireland is now in control of its own destiny again. The Government will borrow a modest amount of money next year. We will ensure we put a rainy day fund aside which will be built up over time. We will not put too much money into the fund in any one year and our primary focus will be on investing in parts of the economy that need capital investment in particular. That is the prudent course of action and Deputy Howlin, as a former Minister for Finance, should understand that.

The logic of that is that the Government should not borrow the money and instead have a balanced budget.