Finance and Public Expenditure and Reform Minister Paschal Donohoe today published the Government’s Summer Economic Statement.
The SES forms a key element of the reformed budgetary process by providing a policy background for the discussions in the Dáil and, subsequently, at the National Economic Dialogue on 26th and 27th June. The SES sets out the Government’s medium-term economic strategy and updates the parameters ahead of Budget 2020.
The economic situation is in good health at present: A decade after the financial crisis, the public finances have been placed on a sustainable path, the economy is at full employment, public services are improving and living standards are rising.
And with the level of employment moving above the 2.3 million mark, its highest level ever, the overarching objective of Government policy is to build upon the progress we have made in recent years.
That said, it is clear that the external environment is becoming increasingly challenging and at this point in time a disorderly Brexit is a real possibility. That is why I am setting out two budgetary scenarios in this SES – the first involves an orderly Brexit occurring, while the second involves a disorderly scenario.
Since the UK referendum result in 2016, a number of steps have been taken to build up the resilience of the economy so that we have the capacity to deal with adverse economic shocks. This includes building up our fiscal resources by balancing our books last year for the first time in ad decade, reducing our debt burden and establishing the Rainy Day Fund.
The steady increases in public spending implemented in recent years, with a particular focus on public capital investment, play an important role in supporting resilience in the face of Brexit.
While the sensible economic and fiscal policies implemented over recent years have placed Ireland in a stronger position to deal with challenges, including Brexit, ccontinued careful management of the economy and of the public finances is needed now more than ever in order to chart our way forward through the uncertain times ahead.
By approaching the SES in this way, we will ensure that we are prepared for all eventualities so that the public finances and our people are protected in the years to come.