Failing to balance the budget leaves us less well able to manage in the next downturn - Central Bank Governor
The Governor of the Central Bank has warned that failing to balance the budget has left us less well able to manage the next downturn.
In a speech that will be seen as a shot across the bows of Paschal Donohoe ahead of Budget 2019, Philip Lane told the Magill Summer School that: “The Government really should be running a surplus at this point.”
He urged the Government to target a bigger budget surplus, including hiking taxes to finance needed public investment.
Volatile corporate tax income, which has been ahead of expectations, should not be used for day-to-day spending, he said.
"In view of the prospect of further economic expansion during 2019-2021, a revision in the budget balance targets for 2019-2021 may be in order if a cyclically appropriate policy stance is to be attained," Philip Lane said.