Health and pension spend will push up debt: OECD

Health and pension spend will push up debt: OECD

Spending on health and continuing to fund the State pension age at 65 will inevitably add a significant amount to Ireland’s debt, the Organisation for Economic Co-operation and Development (OECD) has said.

In a major report on the Irish economy, the Paris-based organisation effectively laid down challenges to any potential new left-leaning Sinn Féin government by saying it wants regular assessments of the local property tax to take account of changes in house prices and by urging further carbon tax hikes for the country to hit its climate obligations.

The recommendations of the OECD come after an election campaign marked by pledges by most political parties to keep the State retirement age at 65 and to invest significant amounts in healthcare.

The report also urges careful monitoring of the rising inequality caused by the disparity in economic clout between Dublin and other regions.

Launching the report, OECD chief economist Laurence Boone said if there were no changes to current policies on healthcare and the retirement age that the government’s debt level would rise significantly in the coming decades.

She said that Ireland is spending significant amounts compared with other OECD countries in funding healthcare and its hospitals, but is getting poor outcomes in terms of better health provision in return.

Ireland is the only western European country without universal healthcare and the health of its people is suffering as a result, said the report.

On ways to boost the building of new homes, Ms Boone said the OECD favours incentives such as rezoning publicly owned land for residential homes and providing public transport for residential sites but not other measures that would only increase demand.

Asked about the political uncertainty and the OECD’s views on the potential of a high-spending, left-leaning government coming to power, Ms Boone said the report was about addressing structural issues in Ireland and ways in which the country can continue to thrive by broadening its reliance on tax revenues beyond the multinational companies.

The chief economist reiterated that successive Irish budgets had benefitted from windfall corporate tax receipts, of which the bulk is collected from multinationals.

This matters as any setback to world trade that affects foreign-owned firms could harm Irish government revenues, said Ms Boone.

The OECD Economic Survey of Ireland runs to 118 pages and details scores of recommendations for an incoming government.

More on this topic

OECD Ireland Report: Pension age at 65 and unchecked healthcare will add to debt levels   OECD Ireland Report: Pension age at 65 and unchecked healthcare will add to debt levels

Growth may cool but sharp slide unlikelyGrowth may cool but sharp slide unlikely

OECD health figures are a real challengeOECD health figures are a real challenge

SIPTU to discuss row over Aer Lingus cost cuts


More in this Section

'How does that represent change?' - Social Democrats TD would be 'massively uncomfortable' with FF/FG govt'How does that represent change?' - Social Democrats TD would be 'massively uncomfortable' with FF/FG govt

High Court allows HSE to detain 'debilitated' woman in hospital who had been living in 'dire' conditionsHigh Court allows HSE to detain 'debilitated' woman in hospital who had been living in 'dire' conditions

Garda Commissioner: I will work with any elected government including a Sinn Féin-led oneGarda Commissioner: I will work with any elected government including a Sinn Féin-led one

Jogger injured by horse on gallops at Curragh Racecourse loses High Court damages claimJogger injured by horse on gallops at Curragh Racecourse loses High Court damages claim


Lifestyle

Veterinary medicine is a demanding career, leading to mental health problems for some vets.Elephant in the clinic: Helpline offers support to vets with mental health difficulties

Bonnie Ryan couldn’t be happier.On a roll: Why Bonnie Ryan couldn't be happier

From Ireland to America and fashion to homeswares, designer Helen James is developing interiors products for the high street with an emphasis on sustainability, beauty and function, writes Carol O’CallaghanConsider this: Meet Helen James

Laura Harding goes on location to see where the new adaptation of Jane Austen's Emma was shotBehind the Scenes: Getting the inside story on the movie Emma

More From The Irish Examiner