Check against delivery
A Cheann Comhairle,
Déanaimid comhbhrón leis na teaglaigh a fuair a ndaoine muinteartha bás ar ár noileán de thoradh Covid a naoi déag.
Táimid ag smaoineamh ar na daoine atá ag fulaingt an víris chomh maith leo siúd atá ag troid i gcoinne an víris gach lá.
Bhuail an ghéarchéim ár dtír go trom. De réir mar a athosclaímid ár dtír agus ár ngeilleagar a atógáil againn, tá deis againn ár sochaí a athmhunlú sa chaoi go mbainfidh ár saoránaigh buntáistí as chomh maith leis na glúine a thiocfas inár ndiaidh.
Once again our thoughts are with the families of loved ones who have lost their lives to COVID-19. As of last night, 1,571 people have died in our State and 494 more have died in Northern Ireland.
In total, 24,315 people in the Republic of Ireland have been diagnosed with Covid-19. Some 87%, have made a full recovery and others are well on the way.
This week we have seen the lowest number of daily deaths and cases, and the lowest number of people in our ICU since March.
While we continue to mourn those who have died, and will never get used to the daily loss of life, we take some comfort in the fact that the trend is going in the right direction. Transmission in the community has been effectively suppressed, which was the strategy from the beginning, and we are now working to suppress it in other settings and clusters.
On Monday we began the reopening of our country, with Phase 1 of the relaxation of restrictions. So far, it is going well. Lots of people are back to work, more shops are open, friends and family within 5 km are able to meet outdoors again. There has been broad compliance with the 5 rules and the 4 steps. SO I want to say thank you to the Irish people. We have shown our capacity to reorganise our lives to protect the welfare of all, and it is a remarkable demonstration of solidarity and care for each other.
However we need to stay vigilant. We really won’t know until the first week of June whether the easing of the restrictions has increased the Reproduction number or to what extent. Cabinet will make a decision on the next steps on Friday June 5th on foot of advice from NPHET. I know that some other countries are opening faster but every country’s circumstances are different and we stand over the slow and steady approach. If things go well, it can be accelerated but we simply cannot make that call at the moment.
Ceann Comhairle, as of midnight Monday, the 18th of May, 295,626 tests have been carried out. We will exceed 300,000 today or tomorrow.
Over the past week, almost 37,000 tests were carried out and of these 932 were positive, giving a positivity rate of 2.5%, a decrease on last week but still little too high.
Testing has ramped up to meet the scale of this crisis and this week the HSE reached its target of having the capacity to test 15,000 people every day, with a capacity of up to 100,000 per week. As the Chief Medical Officer said on Tuesday we need to be fluid. We have more than sufficient capacity right now but that might change and we have to keep alert to changing circumstances.
We have agreed a strategy, which is on target to deliver this week, an average turnaround time from swab to result of between one and three days in the vast majority of instances.
There has also been a remarkable scale up of contact tracing by the HSE. As was reported to the Special Committee on COVID-19 on Tuesday, the HSE says the median turnaround time for giving someone a positive result and commencing contact tracing is now just over one day and improving all the time. I want to extend my thanks, of the Government and this House, to all the people who are involved in testing and contract tracing. The work you do is essential, it’s lifesaving and it’s enabling us to reopen our country and economy so thank you very much.
Ceann Comhairle, work has already begun on preparedness for a possible second wave in late autumn or winter coinciding with the regular flu season. On Monday Minister Harris announced the decision to make the flu vaccine available free of charge to all children aged between 2 and 12 this year, and to all in the defined at-risk groups aged between 6 months tando 69 years. As we know, everyone aged over 70 already has access to the vaccine without charges.
I believe we can save hundreds of lives this winter and every winter by a much greater uptake of the flu vaccine. This matters now more than ever as we need to avoid a second wave of COVID-19 coming at the same time as the flu season.
It’s particularly important that uptake by healthcare workers is much better than in the past. This pandemic teaches us there is no excuse not to be vaccinated. We’ve experienced a small taste of the world was like before vaccines, and it hasn’t been good.
We are also examining ways to retain some of the additional critical care and bed capacity that we have gained in recent weeks. The Department of Health has established an independent expert panel to make recommendations ensuring a protective COVID-19 response in our nursing homes is planned for the longer term, given that we will be living alongside this virus for quite some time. We need to know how we can better shield nursing homes in a second wave if that’s at all possible.
Everyone in this House understands that coronavirus has dealt a severe shock to our economy. This has deep social consequences as well, including record-breaking levels of unemployment and lower living standards for many. There are also long-term sequele that are becoming apparent. For example, due to social distancing, the cost of providing public services and infrastructure projects may rise. It might cost us more to do less.
Many parts of our economy might never look quite the same again, sometimes for the better but also for the worse. The recovery will not be easy. As this is a global recession, an export led recovery driven by agri-food, tourism and multi-nationals like we experienced ten years ago is unlikely. Brexit will further complicate matters. As I said a few months ago, Brexit’s not over. It’s only half-time. Or perhaps, more accurately, half-time has just ended.
On the upside, we have not been shut out of the money markets as we were 12 years ago. At least in part, due to the policies of the outgoing and previous Government, we retain the confidence of the European Institutions and capital markets. In short, this time we can afford to borrow to reflate our economy, at low interest rates and with little conditionality. We are doing this and should continue to do so.
I think we all agree that substantial borrowing by the State will be necessary to cushion the blow to our economy and society. We will have a very substantial budget deficit this year and a deficit and exchequer borrowing requirement for several years to come leading to increased national debt. We will use this borrowed money:
- to provide income support to those who have lost their jobs,
- to get businesses open again,
- to provide retraining and educational opportunities for our fellow citizens who are now without employment, and
- to stimulate economic activity through investment in public housing, healthcare, childcare, transport, regional development, renewable energy and retrofit, as well as the intelligent use of tax policies to stimulate economic activity.
We should continue to borrow until the economy returns to sustained growth. From then on, we should seek to reduce borrowing and our deficit and seek to achieve a broadly balanced budget again within a few years.
We do not need to be best the boys in the fiscal class but we should seek to run deficits similar to those of our peers in Northern Europe, not much larger ones. This is the sensible and sustainable thing to do, it’s what Minister Donohoe is doing and I totally endorse that approach.
I am concerned that there is a growing narrative and belief that we can, as country, borrow cheaply forever and that this is the solution to all our problems. It’s the free money argument and it’s coming from the right, as well as the left. But there is no such thing as free money. Borrowed debt has to be serviced, that is, the interest on it paid every year. This will be a new and recurring charge on our public finances and it will have to paid. Debt also has to be re-financed or rolled over when it matures. Some will say this doesn’t matter because that will be a problem for someone else in ten, twenty or thirty years’ time. I don’t agree with that attitude. That someone is going to be us and if not us, our successors, children and grandchildren.
Furthermore, we should not make the mistake of assuming that being able to borrow cheaply now means we will be able to borrow cheaply in six months or a year’s time. The world has changed so much in the last six months. We would be naïve to think it could not change again and quickly. If conditions do change, the countries with the biggest deficits and the largest debts will be the first to feel the ill wind. We need to make sure that isn’t us. The consequences for our society would be grave.
Even if this never happens, we also need to be honest with the public about the consequences of prolonged low interest rates and increased money supply.
There are lots of upsides like cheaper mortgages and business loans but there are many downsides too. Prolonged low interest rates hit savers, mainly older people. Investment in financial assets like pensions and enterprises is discouraged in favour of physical assets like land and property. We know about this already in Ireland given the poor performance of pension funds in recent years while investors piled cash into development land and apartments thus driving the cost of housing upwards, and exacerbating both the housing crisis and the pension time bomb.
Prolonged and excessive increases in money supply can also lead to inflation. We haven’t seen high inflation for a very long time but that doesn’t mean we won’t see it again. Inflation devalues the spending power of people on fixed incomes, people who don’t have the liberty to increase their fees or raise their prices, mainly those on welfare, pensions and workers.
There are no easy answers. There are no risk free or perfect solutions. No polices that produce only winners. So, the next Government, whenever it takes office, will have to sail the ship of state through the hardest of rocks and the toughest of hard places.
It can be done but it won’t be easy and at all times we need to be honest with the public offering frank answers not easy ones, and real solutions not fake ones.
As always, I look forward to hearing the comments, observations and questions of Members.