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Economic stimulus crucial for recovery – Ó Caoláin

1 November, 2010 - by Caoimhghín Ó Caoláin TD

Speaking at the launch of his party’s pre-budget proposals today Sinn Féin Dáil leader Caoimhghín Ó Caoláin announced a proposal for a state-wide investment programme using 7 billion euros transferred from the National Pension Reserve Fund.

Deputy Ó Caoláin said:

“In ‘There is a Better Way’ Sinn Féin presents an economic plan for real recovery beginning in 2011.

“The key to recovery is the provision of stimulus to get the economy moving again by protecting and creating jobs and ensuring that those on lower incomes are not pushed into poverty, thus further depressing the economy.

“We are proposing a state-wide investment programme using 7 billion euros transferred from the National Pension Reserve Fund. 2 billion would be spent on employment stimulus in 2011.

“Making tax credits refundable, restoring the Christmas social welfare bonus and removing the pay levy from those under the tax bracket would assist people on lower incomes and increase their disposable income at a time when more consumer spending is sorely needed.

“The Government refuses to directly address the jobs crisis, even though there are now over 450,000 people unemployed in this State. It is obsessed with a narrow view of fiscal rectitude because it has completely surrendered what remains of our economic sovereignty to the very forces in both the national and the international financial markets that caused the crash in the first place.

“Savage cuts are being imposed, ultimately, not to re-float the economy but to bail out the banks – with the bill for recapitalisation and NAMA coming to almost €90 billion.

“Fianna Fáil/Green Government decisions are not based on the needs of the Irish people but on the profit motive of international money-lenders.

“But there are choices to be made and a better way is possible. The deficit and the borrowing requirement can be reduced through revenue raising and saving and a stimulus package to promote growth and jobs.

“Our multi-annual plan has the potential to reduce the deficit earlier than 2016, between the increased funds we identify from an overhaul of the tax system and the financial return of our stimulus measures.

“Sinn Féin’s employment and financial stimulus package costs €7.595 billion and will create an estimated 160,000 jobs directly over the medium-term, tens of thousands more jobs indirectly and also save thousands of jobs.

“The full cost of our employment stimulus amounts to €7 billion. The financial stimulus of €595 million is accounted for in our tax and saving measures. The multiplier effect on GDP of creating 160,000 jobs would amount to 1.8%, according to ESRI figures. And this would be real GDP growth – not growth based on the profits of multinational companies based here.

“Our stimulus is about providing immediate and direct employment in key sectors such as infrastructure in the immediate term. But in the longer term, the impact of our stimulus plan would see the state’s competitiveness increase as we become a world leader in green energy, IT and research and development, in addition to having world class infrastructure to attract Foreign Direct Investment and support indigenous enterprise for longer-term employment creation. This sustainable, long-term employment would broaden the tax base and secure it.” ENDS

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