Sinn Féin spokesperson on Public Expenditure and Reform, Mairéad Farrell TD, has welcomed a new OECD report which has revised their growth forecasts for Ireland in 2021 from 3% up to 4.2%. The report also forecasts growth to increase to 5.1% in 2022 as pent up consumer demand is released.
However, Teachta Farrell noted that the report also states that ‘the global economy remains below its pre-pandemic growth path and in too many OECD countries living standards by the end of 2022 will not be back to the level expected before the pandemic’. The OECD say that the ‘exceptional support for households and firms’ can begin to be withdrawn once ‘the recovery is underway’ but should avoid an ‘abrupt ending of support programmes that could induce a macroeconomic shock and derail the recovery’.
Teachta Farrell said:
“First of all, I welcome the OECD’s latest report. They are estimating that the Irish economy is set to grow by 4.2% this year, and increase to 5.1% next year.
“This is welcome and reinforces the arguments that me and my party colleagues have been making since the outset of the crisis. Namely that austerity is the last thing we need to be thinking about.
“By preserving jobs and ensuring the viability of as many businesses as possible, and then through the stimulus measures arising from increases to capital expenditure, we will grow our way out of the current crisis. With economic growth set to increase, we will shrink out debt/deficit as a % of GDP/GNI*.
“Secondly, it is welcome to have the OECD joining the ranks of the IMF and many others, who have been warning about the withdrawing of income supports like the PUP too early.
“Over the weekend, we heard calls from certain sectors and media commentators that the PUP is acting as deterrent from people returning to work, and thus needs to be cut early. Only anecdotal evidence has been offered to support these claims.
“We need to be cautious here. I recall hearing anecdotal evidence about a supposed widespread problem of ‘welfare cheats’ cheating us all, and yet when the matter was properly investigated it proved to be something of a non-issue.
“Calls to have the PUP cut in this regard may have good intentions, but would surely have negative implications for our recovery.”