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

'One in a million': Ghost ship from African coast washes up on rocks in Cork'One in a million': Ghost ship from African coast washes up on rocks in Cork

Storm Dennis: Hailstones the size of marbles fall in KilkennyStorm Dennis: Hailstones the size of marbles fall in Kilkenny

Gardaí concerned for well-being of missing Wicklow womanGardaí concerned for well-being of missing Wicklow woman

'If I had a euro for every time I've been called the 'c word' in the last month...''If I had a euro for every time I've been called the 'c word' in the last month...'


Lifestyle

When Marisa Murphy went to play as a teenager on Dinish Island, she could still see the flowers growing among the ruins in her grandmother’Islands of Ireland: Barely inhabitated Dinish became an industrial zone

MAC make-up artist Lucy Bridge shares her tips backstage at Roland Mouret.How to create the perfect matte red lip, according to a backstage beauty expert

New trends include chunky heeled boots, silver belts and lots of plaid from the British designer.Victoria Beckham got ‘rebellious’ for her new collection – as David and family watched on

When horses were shown photographs of angry human faces, their hearts speeded up.Jackass penguin talk is similar to humans

More From The Irish Examiner