Brexit will require change in Government spending

The Government will, in preparing for Brexit, adopt a "root and branch change of the culture" of its spending",

Minister for Public Expenditure and Reform Paschal Donohoe has said.

The Minister told the MacGill Summer School in Glenties, Co Donegal, that the Government had a contingency plan to deal with the UK leaving the EU and was "acutely aware of the risks that Brexit poses and are taking the steps to ensure we are shielded as much as is possible from its effects".

He said: “Our preparedness for Brexit, however, is about more than just contingencies and plans. It also involves a root and branch change of the culture of Government spending.”

He said the impact of the banking and economic collapse on the people of Ireland cannot be overstated. "Lessons have been learned and there is now a new culture of public spending. Now and in the future, we will ruthlessly pursue value for money with reforming zeal," he said. "Money will only follow the services and the projects that are worthy of funding."

Dramatic events

On the British decision to quit the EU, Mr Donohoe said the Government’s job was to “manage uncertainty and ensure that, as far as possible, our society and our economy are kept on track despite all the threats that developments here and abroad may pose”. “This is certainly the case when it comes to Brexit – another of the dramatic events that has taken place this year,” he added.

The Minister said Brexit had created a new "national question". "The previous question asked where our national borders should be and government within those borders. A new national question asks how we interact with a globalised world and wider union – the European Union. "

Mr Donohoe spoke of how Brexit would have been calamitous had it happened during the economic crash. He said, however, that “the prudent economic and fiscal policies implemented over recent years have placed Ireland in a stronger position to weather this shock”.

Growth rate

He said Ireland’s growth rate remains strong; competitiveness has improved significantly; employment has grown, and unemployment has fallen – to 7.8 per cent in June; and the budget deficit has been reduced significantly.

The Minister said that “those of us in the political centre must redouble our efforts to heal our fractured country and ensure that everyone feels that they are a full part of the society in which they live”.