Head of Government’s spending watchdog quits 18 months before term ends

Michael McMahon has been named acting chairman of the Irish Fiscal Advisory Council (Ifac), after Sebastian Barnes stood down from the role a year and half before his term was due to end.

Mr Barnes left the position as head of the Government’s spending watchdog at the end of June, the Department of Finance said in an emailed statement. Mr McMahon will hold the interim position until a new chairman is appointed.

Having left the council, it is understood Mr Barnes will continue in his full-time role as head of division in the economics department of the Organisation for Economic Co-operation and Development (OECD).

Mr Barnes was reappointed to a final term on the council from January 2021, which was due to expire at the end of next year. He had been a member of the council since it was set up in 2011 at the height of the country’s economic woes, and chairman of the council since the start of 2021. Fiscal council members usually serve four-year terms and are reappointed by the Minister for Finance after each term if they are to continue in their role.

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Mr Barnes “has been central in enhancing the public debate and scrutiny that takes place around complex fiscal and economic issues in Ireland”, Minister for Finance, Michael McGrath said.

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The change was revealed a day after the Government announced a €6.3 billion budgetary package, equivalent to a 6.1 per cent increase in core spending, despite warnings from IFAC to limit a spending increase to about €4 billion, or 5 per cent, to avoid overheating the economy.

Mr McMahon is professor of macroeconomics at the University of Oxford and senior research fellow of St Hugh’s College, among other roles. He previously worked at the Bank of England where, for three years, he was a euro zone economist. At the bank, he was one of the UK’s two representatives on the European Commission’s experts group on economic forecasting. He has also worked for the IMF’s Institute for Capacity Development in Singapore.

The Government will run an open selection process for a new council member for a four-year term, the department said.