Sunday 23 October 2016

Plans for economy forget we're getting much older, experts warn

Thomas Molloy and Colm Kelpie

Published 04/06/2015 | 02:30

Professor John McHale.
Professor John McHale.

The Government has no real plan and is too optimistic about future growth, the country's economic watchdog warns in a report today.

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In the first detailed, independent analysis of Finance Minister Michael Noonan's Spring Statement, the Irish Fiscal Advisory Council has warned that the Government is breaking budget rules imposed on all European Union governments.

Forecasts fail to take full account of an ageing population, spending pressures or promised tax cuts, it warns.

The Government "is not fully compliant with the rules and, as we look further, there isn't really a plan at all", the Irish Fiscal Advisory Council chairman John McHale said.

The council was set up two years ago by the Dáil to look at whether the Government is implementing prudent budgets.

Prof McHale warned the failure to implement the rules "certainly raises issues about whether a prudent policy is being followed".

And in a damning comment on the economic forecasts underpinning Mr Noonan's Spring Statement, the council finds that plans to reduce spending on buildings and other projects are "really not credible".

Not everything in the council's report is bad news - it agrees that the economic recovery is gathering momentum.

Irish Independent

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