The fact that investors are currently paying the Irish State to lend it money highlights just how ridiculous our economic management has become, Social Democrats TD Róisín Shortall said today.
The party’s co-leader was commenting on reports that Ireland raised €750m on the bond markets this morning, selling five-year bonds at a negative interest rate for the first time. The National Treasury Management Agency today borrowed money at a negative yield, or interest rate, of -0.009%.
Deputy Shortall said:
“We have the ridiculous situation where the international markets are prepared to lend us money for nothing, in the middle of a massive housing shortage, but we can’t spend it because of the statistical treatment of Government investment by the EU institutions.
“In the Summer Economic Statement debate in the Dáil today we were told by the Minister for Finance that our fiscal space is modest and that under-investment in infrastructure will continue. Only about €300 million extra is available for new spending next year. This under-investment will extend the housing crisis rather than resolve it.
“What is the use of an A-rating from the rating agencies if it doesn’t actually make any material difference to the problems facing our country? Austerity was for nothing if we can’t now invest prudently to resolve the acute housing and infrastructure deficits in Ireland.
“It’s clear that the EU’s fiscal rules are completely inappropriate for Irelands economic situation and are damaging the management of the economy. There is no evidence that the government has even challenged these, and without some kind of breakthrough we aren’t going to deal with the severe under-investment in capital spending.”