A decision will need to make on what to do with a €16 billion windfall largely derived from the Apple tax judgment within the next three weeks, Government sources have indicated.
In addition to the €13 billion from the Apple case being added to the exchequer, the State will also be in receipt of an additional €3 billion for divesting some of the shares it holds in AIB bank.
“They will have to identify [where the money will go] pre-budget,” said one source with knowledge of discussions.
The Apple windfall will not be available to the State for use until March.
The Irish Times spoke on Wednesday to a number of sources in Government from different departments and from each of the three Coalition parties.
It is understood that no substantive discussion at Government level has yet occurred but such conversations would begin in earnest over the coming week.
There was general agreement that only a portion of the windfall would be spent directly, with some at least being earmarked for a sovereign wealth fund, or a rainy-day fund. No decision has been made on how much will be allotted to this fund.
Some of the State’s biggest and most pressing infrastructure requirements could benefit, sources indicated. Housing was the area that was primarily identified, in addition to water infrastructure, the national grid and roads.
Projects that could benefit from investment include the new proposed water supply for Dublin from the river Shannon; an ambitious expansion of the national energy grid to accommodate new sources of power including offshore wind energy and providing capacity for data centres; and specific funding for the biggest Land Development Agency projects.
[ Apple tax: Taoiseach suggests funds could go towards infrastructure and housingOpens in new window ]
Fine Gael strongly supports the establishment of a department of infrastructure, although there is less enthusiasm for the idea within Fianna Fáil, where some expressed a view that it would duplicate the work of existing departments.
Speaking at Fine Gael’s two-day meeting in Tullamore on Thursday, Minister for Public Expenditure Paschal Donohoe said he sees “huge merit” in a new department of infrastructure.
“There is a significant amount of new infrastructure the State does need to build in the years ahead. That’s where the real money will be spent. Having a minister whose job it is to look at that infrastructure is something other countries have done and have done well.”
Mr Donohoe indicated that some of the windfall would be put aside into a fund and also emphasised that none of the money would be used for ongoing expenditure.
“We need to ensure that we don’t fool anybody into thinking that we can use this money to pay for expenses and to pay for wages that will recur again and again in the future. This is a once-off amount of money that we get to spend once.
“We need to spend it wisely on things that can shape the future of the country.”
Speaking from the meeting Taoiseach Simon Harris and Mr Donohoe indicated the money would be directed primarily at housing, energy, and water. Separately, Minister for Housing Darragh O’Brien also said he would like to see a substantial spend on housing and is understood to be preparing a case to make to Cabinet colleagues this month.
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