Thursday 13 December 2018

'We must never lose control again' - Paschal Donohoe vows to balance books in Budget

Paschal Donohoe. Picture: Collins
Paschal Donohoe. Picture: Collins
Cormac McQuinn

Cormac McQuinn

Paschal Donohoe has insisted he is committed to balancing the books and delivering sustainable tax reform and reduction in the Budget.

Mr Donohoe warned last night that Ireland must never lose control of its public finances again and should adopt a responsible fiscal approach.

The Finance Minister made the remarks during a speech on renewing centrist politics in which he outlined an agenda for economic and social reform.

And he said such an agenda was why the Fine Gael-led minority government was committed to passing a third Budget under the confidence and supply deal with Fianna Fáil.

The speech at the Collins Institute, a Fine Gael-backed think-tank, comes as Mr Donohoe prepares to enter talks on Budget 2019 with the rival party which is propping up the Government.

Mr Donohoe argued for a "steady State economy" and said well-managed economies were characterised by durable improvements in living standards "rather than the 'all-or-nothing' approach that has been a feature of Irish economic performance."

He said Ireland had trailed behind other small open economies when it came to responding to economic shocks which he said "wreak havoc within our country".

Mr Donohoe said: "This is why maintaining control of our public finances is so vital."

He said developing a steady state economy meant continuing progress in balancing the books while investing for the future. "To relate this to what is happening, it's why we are balancing our books, it's why we are setting up a rainy day fund. It's why we are continuing to look at how we can reduce our national debt, fund Ireland 2040 and at the same time look to make progress in affordable, sustainable tax reform and reduction."

And he added: "Lest there be any doubt about the objectives behind this speech… this is of course one of the many reasons why I, and the Government, are committed to passing a third Budget and honouring the confidence and supply agreement with Fianna Fáil."

He delivered his speech against a backdrop of a rise in populism in both Europe and America, typified by Brexit and the election of US President Donald Trump.

Mr Donohoe also highlighted how Ireland's membership of the EU has helped modernise Ireland's economy, society and politics. He spoke of the challenge posed by Brexit and how one response has been the Global Ireland initiative which aims to increase Ireland's diplomatic and business presence worldwide.

He said multilateralism on the international stage was needed to tackle climate change and security challenges.

Irish Independent

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