The Opposition last night poured scorn on suggestions by the Minister for Education, Mr Dempsey, that members of the Government's special savings scheme should be allowed to invest their lump sum in public bonds for school building projects.
Mr Dempsey became the first Minister to lay claim to the billions of euro that will be released into the economy when the scheme unwinds in 2006-2007 by saying that the Government could provide a guaranteed return if savers reinvested their money in school buildings.
Such remarks indicate that the Government is beginning to give serious consideration to means of avoiding up to €16 billion being released to consumers in one 52-week period.
This would create serious inflationary pressure, a prospect that Ministers are keen to prevent. Some informed political observers believe the Govern-ment will move to introduce a package to encourage savers to invest their lump sums in pensions.
Mr Dempsey said he had not developed any detailed plan but said such an initiative could be used to incentivise savers to put their money aside instead of spending it. "Everybody in the Government would be aware of the danger of the €12-€16 billion actually being released into the economy and it being spent on imported cars, foreign holidays or whatever else," he said.
But Fine Gael and Labour dismissed the plan and said that such an initiative would not be as innovative as the Minister had claimed.
Fine Gael's finance spokesman, Mr Richard Bruton, said the suggestion was well-intentioned but pointed out that taxpayers would have to fund such a scheme.
"It does not exactly enhance his case for the vacancy as minister for finance in any future reshuffle.
"Whether you call borrowing an education bond, a road bond, or a hospital bond, the effect is just the same. Taxpayers have to fund the interest and repayments."
Labour's spokeswoman, Ms Joan Burton, said Mr Dempsey was seeking to gloss over his own failure to secure investment for schools.
