Dáil Éireann - Volume 321 - 21 May, 1980

Ceisteanna—Questions. Oral Answers. - Money Flow Statistics.

12. Mr. Harte asked the Minister for Finance if he will give details of any statistics available on the money flow into and out of the Republic since our [246] entry to EMS giving the rate of flow for each month to date.

Mr. O'Kennedy: The answer is in the form of a tabular statement which with the permission of the Ceann Comhairle, I propose to circulate with the Official Report.

Following is the statement:

The net effect of all external receipts and payments, both in respect of current and capital transactions, is reflected in changes in the level of official external reserves. Monthly data on changes in official external reserves from March 1979 to March 1980 are given below:

Change in Official

External Reserves

(£ million)

1979

March

-

117.0

April

-

66.3

May

-

150.8

June

+

73.0

July

-

17.4

August

-

55.9

September

+

13.0

October

-

63.4

November

+

55.8

December

+

48.7

1980

January

+

12.5

February

-

20.0

March

-

6.5

Mr. Harte: Does the inflow exceed the outflow?

Mr. O'Kennedy: There is a changing pattern. The inflows since the date in question would not have exceeded the outflow.

Mr. Harte: More money has left the State since we entered the EMS?

Mr. O'Kennedy: Yes, since then but, as the Deputy will be aware, immediately after joining there was quite a lot of repatriation of capital from here to England which distorts the overall figure. That pattern is not continuing to the same extent.

Mr. Harte: Would that not have happened [247] in reverse? Would there not have been a neutralising effect?

Mr. O'Kennedy: I do not think so.

Mr. Harte: But it did happen.

Mr. O'Kennedy: Yes.

Dr. FitzGerald: What were the trends in the early months of this year in respect of capital flow?

Mr. O'Kennedy: In comparison with the patterns last year, encouraging.

Dr. FitzGerald: There is a positive flow?

Mr. O'Kennedy: In one of the first three months of this year there was a positive flow and the other negative, but negative at a level that was generally less than last year.

Dr. FitzGerald: Less bad than last year but still an outflow?

Mr. O'Kennedy: On average for the early months of this year it was a significant improvement on last year.

Dr. FitzGerald: Money is still flowing out?

Mr. O'Kennedy: I would not say “flowing out” is the term.

Dr. FitzGerald: A net outflow but less than last year?

Mr. Harte: What was the position in the previous year?

Mr. O'Kennedy: The Deputy will find the details in the statement I have given. As I indicated, there was a very heavy net outflow in the early months of last year.

(Interruptions.)

Mr. Harte: Does the Minister consider that based on the capital inflow it was in the interests of the State to join the EMS?

[248] Mr. O'Kennedy: Yes.

Mr. Harte: The decision to join the EMS, in the Minister's opinion, is still right?

Mr. O'Kennedy: Absolutely.

Mr. Harte: Taken without any other consideration, it was still right?

Mr. O'Kennedy: I do not know what the Deputy means by “taken without any other consideration”. Taking all considerations into account it was still right.

Mr. Harte: Irish unity is no longer a priority.

Mr. O'Kennedy: I am answering as Minister for Finance.

Mr. Harte: When the Minister talks politically about Irish unity he should also think economically about Irish unity.

(Interruptions.)

Mr. O'Kennedy: The Deputy can ask the Minister for Foreign Affairs about Irish unity when he comes into the House.

Dr. FitzGerald: The figure I was asking about was the autonomous capital flow, exclusive of Government borrowing. I take it the information the Minister gave related to that.

Mr. O'Kennedy: I was talking about the net effect of all——

Mr. Bruton: The more you borrow the more money——

Dr. FitzGerald: Including Government borrowing?

(Interruptions.)

Mr. O'Kennedy: I answered the question I was asked.

[249] Dr. FitzGerald: There is still a net outflow. It takes into effect all aspects. Government borrowing as well?

Mr. Bruton: The Government have been borrowing hand over fist.

Dr. FitzGerald: What was the trend of autonomous capital inflow, exclusive of public sector borrowing?

Mr. O'Kennedy: I do not have those figures broken down and the question did not require that I should, but if the Deputy asks that question I will give him those figures.