On climate action, the OECD says major investment will be required to make the national electricity capable of taking on more renewable energy
The OECD, the Paris-based think tank, says the Irish economy is"coping well" with the repercussions from Russia's war against Ukraine.
It observes that high inflation is putting pressure on the Government to increase spending but it warns this risks undermining the new spending rule.The OECD warns that additional spending to support demand"should be avoided in the current context of high inflation". Noting the problems of housing affordability, it suggests that a special division be established in the High Court to deal with planning reviews and challenges.
The OECD also says that spending on long-term care is already"elevated" and that"efficiency gains" will be important in addressing the pressures facing the healthcare system, particularly as the population ages. Regarding today's OECD economic report on Ireland, the Minister for Finance Paschal Donohoe said the organisation's view is broadly consistent with the Government's view of how the Irish economy will perform in the time ahead.
On the OECD's call for the Government to keep a lid on spending in the face of inflation, Mr Donohoe said the Irish Fiscal Advisory Council had found the intervention measures in the budget had been broadly right. He said it is inevitable that when a major piece of reform is proposed that there are differing reactions to it."But we have legislation that will begin pre-legislative scrutiny and I know will undergo significant debate and evaluation within the Oireachtas."
"So the next step for us with regard to that is reaching a decision regarding the right level of PRSI within our tax code and within our economy and we believe that is a different and as effective a way of addressing the sustainability of our pension system."The OECD's Deputy Director of Country Studies Vincent Koen said the pandemic has not left too many scars on Ireland, adding that the country"has really done a very good job in dealing with these shocks".
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