Ireland 2040 is no radical plan and Labour would expand it

Speaking to the Labour Party’s Central Council, Party Leader Brendan Howlin said that Fine Gael’s investment plan is not radical enough and that Labour would propose to significantly exceed the ‘Ireland 2040’ target of €91 billion in public spending over the next decade by scrapping the rainy day fund and limiting future tax cuts, providing up to extra €15 to €25 billion for investment.

Deputy Howlin said:

“Yesterday we were treated to this Government doing what it does well – elevating spin over substance.

“Harking back to the Fianna Fáil approach of a decade ago, we were treated to an orgy of promotional videos, tweets, and Ministerial hyperbole, rehashing projects that had already announced, and long fingering the transformational projects needed to address the problems Ireland faces.

“There couldn’t but be headline announcements in a ten year spending plan but let’s be clear. This isn’t a radical plan. It is a plan designed to free up fiscal space for tax reductions in the years ahead.

“In 2015 just a year after we left the bailout, I announced a €42 billion capital plan over 5 years. As things continued to improve, I and the then Government were able to add a further €6.6 billion to it, most recently in 2016.

“The total investment of €115 billion unveiled yesterday has been inflated and flattered by extending the time period over which it would take place. In truth, given where we are now compared to where we were back then, and indeed where we hope to be by 2027, the plan is not all that much bigger.

“Anyone hoping for a substantive take off in public investment is being kidded. There is a reason why the plan contains so many rehashed projects. The new GNI* figures are used to measure the plan instead of GDP because it makes the Government commitment look bigger than it actually is.

“If given the opportunity Labour would commit more resources to capital investment over the same period and will argue the case for that to the people.

“Paschal Donohoe has been told by the Fiscal Council among others that his rainy day fund can’t operate as they would like, but committing those resources to capital investment as Labour has proposed would increase the fund by at least a further €5 to €10 billion.

“The reality of yesterday’s tame announcement is that it also means instead of investing, Fine Gael will allocate those resources to tax cuts. Assuming that FG continue with their ideological commitment to use a third of all available resources each year for tax cuts, a sum in excess of €10bn, and possibly closer to €15bn will be used in an effort to buy the affections of votes, instead of being invested in building a better future for all of Ireland.

“Yesterday, the Taoiseach challenged opposition parties to support his plan, or to explain their opposition. Our reasons for opposing this plan are simple – it is not nearly ambitious enough and no amount of glitz or advertising will change that factor.

“I have made two simple suggestions that by scrapping the useless rainy day fund, and the obsession with tax cuts it would provide a further €15 to €25 billion for productive investment over the next decade. That would allow the Government’s plans to be truly ambitious for our future.

“Capital investment is only one part of what’s available to us as a nation to use over the next decade and what we build will require current spending too to sustain it. What we got yesterday was a partial picture, an incomplete picture despite all the bells and whistles. That’s what we were meant to get too.”