THE GOVERNMENT HAS been criticised over funds being held as cash, instead of being reinvested into the domestic economy.
The money is part of National Pension Reserve Fund (NPRF) discretionary portfolio and, as of March, came to around €2.7 billion. This represents about 35% of the overall fund, a figure that has increased substantially in recent years.
At the end of 2011, the NPRF’s cash assets came to around €950 million. The cash assets being held by the State body currently earn approximately 0.04% a year.
This information arose in relation to a parliamentary question asked by Fianna Fáil finance spokesperson Michael McGrath. Criticism from Deputy McGrath centred on the Ireland Strategic Investment Fund (ISIF), describing progress as “extremely slow”.
The fund was set up in 2011 with the purpose of reinvesting capital in the domestic economy. On the lack of investment in jobs and growth, the Cork TD said:
This indicates that the Government is more interested in extracting publicity from multiple announcements of the same initiative than it is from ensuring that the plan is actually carried out.
Criticism was also leveled at the the use of NPRF in relation to SME-related funds. On this McGrath said: “In some instances these investments have involved the purchase, at a discount, of existing SME loans that are close to maturity. While this may be attractive as a pure investment there is little economic benefit involved.”
The Department of Finance was unavailable at time of publication.
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