The Minister may remember I raised concerns about the refinancing of some of our benchmark bonds in 2018 and 2019 with him, the Taoiseach, Deputy Varadkar, and the previous Taoiseach, Deputy Enda Kenny. Since 2008, our national debt and interest payments are approximately the same size as the budget that the Minister launched a couple of weeks ago. The overall size of national debt is projected to be more than 100% of gross national income. What are the Minister’s projections for the next four or five years, particularly in regard to refinancing?
Does the Taoiseach intend to bring in legislation this year on the so-called rainy day fund? There is nothing indicated on the clár and, as he is aware, the Department of Finance is talking about diverting €1.5 billion from the Strategic Investment Fund and €0.5 billion a year from people’s taxation, to which the Taoiseach referred earlier, into such a fund from 2019. We heard earlier from the leader of Fianna Fáil about the huge gap that we know exists in the health budget for 2018. We have the ongoing disaster in housing and we have a very large national debt, one of the highest in the OECD.
Earlier we discussed the summer economic statements, but perhaps the biggest challenge facing the country is the massive size of Ireland’s national debt and the huge chimney stacks of debt, as they are called, which must be refinanced between 2018 and 2020. The 2016 National Treasury Management Agency, NTMA, annual report and the annual report on public debt in Ireland by the Department of Finance make it clear that the national debt is the elephant in the room of the national finances. At the end of 2016, general Government debt stood at €201 billion, which represents between €42,000 and €46,000 for every man, woman and child in the country. The national debt represented 274% of general Government revenue and was nearly 250% of the national wage bill. By these measures Ireland remains one of the most indebted countries in the world alongside Japan, Portugal and Greece. Indeed, on the new reference point of GNI* our national debt is 100%.
Today during Leaders’ Questions, Deputy Broughan asked the government to direct or encourage the National Treasury Management Agency (NTMA) to refinance our huge stacks of debt amounting to over €46 billion (or a quarter of our total debt) as urgently as possible while interest rates are low and given the worrying risks in our external economic environment. Through his role in the Budgetary Oversight Committee and interest in the economy, Deputy Broughan has become increasingly concerned about maturing bonds in an increasingly erratic international environment in the wake of the Brexit result and Trump Presidency.
I had the opportunity to speak on several important issues this week. On Tuesday evening, I commented on Ireland’s Brexit negotiation guidelines and later I made a brief contribution to the Labour Party motion on AIB.
On Wednesday evening, I got an opportunity to again call for major investment in Dublin public transport including Metro North. Finally on Thursday, I questioned Minister Katherine Zappone on the grave deficiencies in aftercare services for young people and raised the urgent need to restore salaries for staff in Section 39 health and disability services organisations.
On Friday afternoon, I met the Director of the NTMA, Mr Conor O’Kelly, with his colleagues, Mr Frank O’Connor and Martin Whelan, on the refinancing of Ireland’s huge national debt in 2018/2020.
We had a very sobering account of our national debt from the chief executive of the National Treasury Management Agency, NTMA, Mr. Conor O’Kelly, and his head of funding, Mr. Frank O’Connor in the Committee on Budgetary Oversight a few weeks ago. They answered concerns that had been put to me about the refinancing of our debt, particularly in late 2019 and early 2020, when these chimney stacks of debt will have to refinanced. Is the Minister happy with the strategy of the NTMA? Does he think that perhaps they should be lending for longer at the really low rates that we have at the moment? Is it a strategy that the Department of Finance is happy with?