Government will need to look at ways to find extra money in wake of Covid crisis, says McGrath

The Minister for Public Expenditure has said it is “inevitable” the Government will have to examine ways to raise extra revenues to fund expanded State services in the wake of Covid-19.

While saying there is no current plan to raise taxes, Michael McGrath said said: “We have to keep our options open. We’re certainly not saying that there won’t be revenue-raising measures in the Government’s lifetime, because I think it is inevitable that there will be some.”

"I think we will inevitably have a larger State coming out of the pandemic," Mr McGrath said in an interview with The Irish Times. Some interventions will be temporary, but "we have also made decisions that will result in a permanently larger public service", he said.

“That will need to be paid for within an overall framework that is responsible and sustainable,” he said, adding that the Government is “placing a priority on the provision of good public services, and that’s something that I strongly believe in”.

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He said a longer term plan for the public finances would be outlined in the Stability Programme Update next April, but that at each budget “both on the expenditure side and on the revenue-raising side, it would be foolish to rule things out”.

On Friday, a further 482 cases of Covid and seven further deaths related to the virus were confirmed as chief medical officer Dr Tony Holohan urged people not to "drop their guard".

Letter

In a letter sent to the Government late last week and seen by The Irish Times, Dr Holohan warned the proportion of cases among older people and in nursing homes remains a concern.

Dr Holohan also noted the trajectory of the disease in Dublin was different to the rest of the country, with the rate of improvement happening at a slower pace.

On Friday Taoiseach Micheál Martin indicated there may be a staged approach to exiting Level 5 at the start of December. While Christmas would not be the same as last year he wanted it to be a “meaningful” one. He expected churches to be open for Christmas week but warned there will be no “going on the lash”.

Meanwhile Northern Ireland’s Minister for Health has said plans to begin lifting Covid-19 restrictions in a week were a “gamble” and further measures will be needed “probably” before Christmas or the New Year.