Budget Perspectives conference

What they said

• ECONOMIC SHOCKS sparked by the escalation of oil prices and a riskier investment environment will have a lasting impact on the sustainable level of output in OECD economies, according to the authors of a report prepared for the ESRI Budget Perspectives conference.

In a paper presented to the conference, Ray Barrell and Simon Kirby of the London-based National Institute of Economic and Social Research (NIESR) said that while the severe housing downturn would have a cyclical impact, the sea change in oil prices between 2006 and 2008 and the increase in risk on world financial markets would have structural implications for economic output.

These structural shocks will reduce sustainable output growth by 0.5-1 per cent a year.

"Real wage growth has to slow to accommodate this. In addition, government spending plans have to be adjusted or taxes will have to rise," the authors conclude.

• A CARBON tax should be introduced in budget 2009 with the revenues used to reduce other taxes, address fuel poverty and support a reduction in greenhouse gas emissions, according to Lisa Ryan, Frank Convery and Noel Casserly.

"We are facing a carbon constrained world where 'do nothing' is not an option," they said. They propose that a carbon levy be phased in immediately, with exemptions made for agriculture and those power sector and heavy industry companies that already belong to the EU Emissions Trading Scheme (ETS).

A "cap and share" scheme could apply to the transport sector, whereby companies must buy allowances from individual citizens to cover industry emissions. This could give consumers a stake in tackling climate change and compensate them for the rise in fuel prices.

Ms Ryan and Mr Casserly are directors of Comhar, the sustainable development council, while Mr Convery is professor of environmental studies at UCD.

• ELITE SPORTS (national and international level sport) receive twice the level of public funding as "grassroots" sport (local competitions and recreational play), while the money that does go to the grassroots focuses too heavily on physical facilities rather than "human and social capital", said Pete Lunn, ESRI research fellow.

The three main national governing bodies for GAA, soccer and rugby receive 55 per cent of all grants, with GAA sports receiving the most.

However, if the aim of Government sports funding policy is to increase participation and maximise the health benefits from sport, then this is not a logical way to divide the funding, Mr Lunn told the conference.

Adults are more likely to take up participation in individual rather than team sports, while these team sports also have a strong gender bias. The current distribution of funds is difficult to justify, he said, and should be re-examined.