move that Dáil Eireann affirm its supports for the Government’s action in tackling the current economic and fiscal crisis.
The measures we announced yesterday are exceptional but these are exceptional circumstances. There is an ocean of advice out there about what we should do. And we have listened to that advice. But, in the end, it is for the Government and the Oireachtas to act in the interests of all our citizens.
The economic position facing us needs little elaboration by me. Growth is forecast to decline by 4½% this year. Export growth will be negative. Unemployment has increased significantly and will, as anticipated by our forecasts, continue to rise as we can see from today’s figures. The maintenance of jobs is paramount and restoring competitiveness is central to this goal. The action taken by government will be supportive in this regard.
The one bright spot is that inflation will ease considerably, reflecting the reductions in interest rates, lower oil and other commodity prices. All of this helps to boost people’s income in real terms.
We will have to borrow €18 billion this year at steeper interest rates to finance capital spending and also to plug the revenue hole in current spending. The National Debt will rise to over 45% of GNP and spending on interest costs alone will come to €4½ billion or 12% of the total tax take in 2009. This cannot go on. Thankfully, our establishment of, and investment in, the National Pension Reserve Fund means that our net debt is much lower and this, together with the cash balances built up by the NTMA allows for a better funding position than would otherwise be the case.
Nonetheless we must do three things to restore our public finances and our economy;
Ø We must get our cost base down as quickly as possible and become the highly competitive economy we once were, if we are going to achieve future export-led growth.
Ø We must keep up the real value of our investment in our national...