Government providing ‘limited firepower’ to fight Brexit - McGrath

National Economic Dialogue hears of multiple threats to economic prosperity

Fianna Fáil finance spokesman Michael McGrath pictured at the event in Dublin Castle

Fianna Fáil finance spokesman Michael McGrath pictured at the event in Dublin Castle

 

The Government is promising “ very limited firepower” to fight Brexit, Fianna Fáil finance spokesman Michael McGrath has claimed.

Speaking at the National Economic Dialogue at Dublin Castle on Wednesday, Mr McGrath warned the €700 million to be made available for new spending in the October budget was likely to be insufficient to fight off the likely negative impact arising from Britain’s exit from the European Union.

“Apart from measures to mitigate the effects of Brexit, in whatever form it is going to take, the other key priority has to be to protect frontline services,” Mr McGrath said.

He was among a number of speakers to take part in a panel discussion as part of the event, at which participants discuss views on what the budget should contain.

In his speech, Mr McGrath also warned of the need to deal with an “affordability crisis” in the housing sector and called for “proper” multi-annual budgeting in health.

“Many of our budgetary problems come in the area of health. We have a handle on what the demographic trends are [ but] we are not costing them and bringing them into long terms plans properly,” he said.

Also speaking at the event, Danny McCoy, chief executive of lobby group Ibec, warned that private investment was still significantly higher than public spending on infrastructure.

“It remains the case that if we do not have a rise in public infrastructure to match the scale of the population things will become unsustainable regardless of the external context,” he said.

“In many cases we see this private affluence developing and in many cases public squalor is a consequence of that and I think that is a great challenge for this society,” Mr McCoy added.

Labour finance spokeswoman Joan Burton described Minister for Finance Paschal Donohoe’s Summer Statement as “a bit of fiction,” adding that Government should be more forthcoming on information ahead of the budget.

“In all honesty we need to have a more detailed discussion about some of the dangers facing us,” said Ms Bruton.

Patricia King, ICTU general secretary said the State faces major challenges in the years ahead, “including climate change, the housing crisis and a creaking health system.”

“A substantial increase in productive investment in people, infrastructure and people is the only way to ensure a sustainable and inclusive prosperity,” Ms King said.