Ireland will be the fourth best-off state in Europe by 2006 if the Government implements the National Development Plan, according to the latest report from Goodbody Stockbrokers.
The new plan will accelerate growth and put off the economy's anticipated soft landing, according to the report, 2006 - Delivering the Goods. Goodbody said the impetus which the National Plan will give to the economy will postpone the widely expected slowdown and will lift growth by 1 percentage point. Growth in Gross National Product will now run at 8 per cent a year until 2002, said Goodbody chief economist Mr Colin Hunt.
It will also place Ireland fourth in the EU league table of wealth in 2006 compared with an expected ninth position without this extra spending, according to Goodbody calculations. In addition, the Exchequer surplus of receipts over spending will be running at 3.5 per cent of GNP and debt will have reduced to just 16.7 per cent, he predicted.
"We are simply mid-way through a golden economic age," he added.
"There is strong growth, better infrastructure on the way, better social and educational opportunities and a fiscal position the envy of our European partners."
However, Goodbody also warns that new roads and houses will simply not materialise to the extent envisaged unless substantial measures are taken to tackle labour shortages.
According to Mr Bernard Feeney, director of Goodbody Economic Consultants, who co-authored the report, there has to be substantial employment creation to implement the plan. Given low unemployment this will have to be achieved by women and immigration.
"Measures to encourage increased female participation and a clear policy on immigration are required."
This means the Government must do more in terms of childcare support. "`The [national] plan is light on encouraging married women. It does not address the issues of incentives for women to take up jobs. There is also no immigration policy."
According to Mr Hunt substantial tax reductions will also be needed in order to attract married women into the workforce and more labour from Britain where tax rates, particularly for single people, are far lower. He added that it was important to put a coherent immigration policy in place. "That is a very important determinant of the success of the policy," he added.
Mr Feeney also said that both road and water charges will have to be introduced. "In 20 years' time we will look back and wonder why we did not have charges at the turn of the century," he said. The bus and taxi markets will also have to be liberalised, he added.
One other problem, according to Mr Feeney, is the system for monitoring the National Plan.
The current committee is mainly charged with overseeing the implementation of EU grant schemes and has a much weaker role when it comes to Exchequer-funded projects.
