The Labour Party has laughed off a suggestion that a massive school building programme could be funded by a bond issue aimed at SSIA holders. But the Irish National Teachers' Organisation gave the suggestion a qualified welcome.
Over €12 billion is expected to be released when the Government's Special Savings Incentive Accounts (SSIA) mature in 2006 and 2007, and the Minister for Education, Mr Dempsey, is hoping some people will be looking for further investment options.
He said today he would be bringing plans to fund his ambitious €2.5 billion school building programme to the Cabinet when the Minister for Finance examines offering new savings options to SSIA savers.
Mr Demspey told RTE radio today that he was expressing an opinion in response to a question from a reporter rather making a firm proposal at this time.
"It's an idea [that is] worthy of being followed ... I think if people are given some encouragement they would be willing to leave that money," he said.
There is considerable concern that inflation could spiral if SSIA holders spend their cash when their polices mature and the Minister for Finance has indicated in the past that the department will consider new options for investors.
Labour Party finance spokeswoman, Ms Joan Burton, described the idea as "total waffle". She said Mr Dempsey could borrow money for his plan from the National Treasury Management Agency with Cabinet approval.
"Issuing bonds to SSIA holders is technically no different from using money deposited in the post office, or raised through bond-issues on international markets," Ms Bruton said.
Recognising the potential danger to the economy of maturing SSIAs, she said a coherent Government policy is needed "rather than random statements from Government ministers".
"Once again, Noel Demspey is talking the talk, but not walking the walk. He is not a one-man think-tank," Ms Bruton added.
Mr John Carr, general secretary of the INTO welcomed the suggestion but said schools cannot wait for SSIAs to mature. "This must be undertaken now otherwise today's announcement is worthless," he said.
Schools are over-crowded and buildings dilapidated throughout the country while €500 million more is needed over the next five years to meet current school building plans, Mr Carr added.
"This money needs to be found quickly and this proposal offers a possibility. Failure to do so will mean that many of the 400 schools on the building list will remain on it for the rest of the decade."