Ireland

Donohoe denies multibillion-euro spending plan linked to election

The Minister for Public Expenditure announced plans on Wednesday to spend more than two billion euro for projects under the National Development Plan.

The Minister for Public Expenditure said the funding was to help with soaring inflation
Paschal Donohoe The Minister for Public Expenditure said the funding was to help with soaring inflation (Niall Carson/PA)

Paschal Donohoe has denied that the 2.25 billion-euro additional spending for projects in the National Development Plan (NDP) is linked to the timing of the next general election.

The Minister for Public Expenditure said the funding was to help with soaring inflation and enable government ministers to progress with their planned projects.

On Wednesday, the minister announced plans to spend more than two billion euro for projects under the NDP scheme, including public transport projects, the building of social homes, and bringing in additional acute hospital beds.

Mr Donohoe denied the funding was linked to an impending general election, which must take place by early next year.

“It has nothing to do with the timing of an election,” Mr Donohoe said.

“I never said it was an unreasonable question. I just answered it. It doesn’t have anything to do with the timing of the election.

“What it has more to do with actually is the premise – we’ve had soaring inflation now over the last two years. There’s real signs that that’s beginning to come down now.

“I wanted to do two things. I wanted to ensure the commitments the Government has made in relation to building homes, building schools, student accommodation, in relation to the future of sports here in Ireland, that we can honour and preserve those commitments.

“Secondly, in a small number of cases, a number of ministers now will have the ability to go ahead with a few new commitments during the year. That’s what the process was designed to do and has done.”

Mr Donohoe told RTE’s Today With Claire Byrne show that there was no “pulling money out of a hat”.

“It was announced on Budget Day. There’s no hat here. This is all part of our budget arithmetic,” he added.

“On Budget Day, I announced – along with the Minister for Finance Minister (Michael) McGrath – there will be an additional two-and-a-quarter billion allocated for this year and in 2025 and 2026.

“It was a Budget Day announcement. It’s now been implemented. I said we’d get it done early in the year, we’ve got it done before Easter. That is all there is to it.

“Overall, when I started off doing this kind of work in 2017, we had capital investment in our economy of 4.5 billion euro. By the end of this process, it will be more than 14 billion euro.

“We’ve been able to put in place this kind of an increase because our public finances are safe, there are stable, we’re running a surplus.

“Because of that we can make these changes – it will lead to more homes being built, it will lead to better skills and will play a part in dealing with all of the issues within our society.”

Sinn Fein’s Pearse Doherty called on the Government to reverse its decision to restore excise duty
Sinn Fein’s Pearse Doherty Sinn Fein’s Pearse Doherty called on the Government to reverse its decision to restore excise duty

Mr Donohoe also defended the decision by Government to restore excise duty from midnight on April 1, when the cost of petrol and diesel will rise.

They will return to the level they were at before a cut was brought in two years ago.

Drivers will pay an extra four cent per litre of petrol and three cent per litre of diesel from Monday.

Sinn Fein’s Pearse Doherty called on the Government to reverse its decision to restore excise duty.

But Mr Donohoe said the cost of fuel today was much lower compared with two years ago.

“The reason why we are doing this is that when we, and it was myself actually who brought in the excise reductions over a year ago, the price of fuel was at that point, well in excess of two euro per litre,” he added.

“Even though the price of fuel is higher than we would want it to be, it is far, far lower than when we brought in these initial changes.

“The truth of it is is that if we were not to go ahead with the excise increase that’s going up, then we will have to change plans elsewhere.

“It’s about the need (for) honesty and acknowledging that these are complex issues.

“I accept that it creates cost for those at a time in which inflation is still there. I accept all of that. But the truth of it is, we spent hundreds of millions of euro taking down excise when fuel was well above two euro a litre.”