SSIA cash 'will add 2% to growth'

THE surge in spending triggered by the release of €14 billion from the Government's Special Savings Incentive Account (SSIA) scheme will add nearly 2% to economic growth rates in 2006 and 2007, Goodbody stockbrokers said yesterday.

Goodbody head of research Colin Hunt said the effect of the SSIA release would bump up Ireland's Gross National Product (GNP) growth rate from 4.8% to 6.7% in 2006 and from 4.7% to 6.2% in 2007. But he added that growth could be even higher if consumers chose to spend their windfalls rather than invest them.

Goodbody's forecast was based on a survey by market research firm TNS MRBI that showed SSIA holders planned to spend one-third of the windfall and invest the remainder. But Mr Hunt said people surveyed may have been too conservative when responding and they would be likely to spend more when the time came.