force, access to the wider eu market ( and labour force ), a stable environment for businesses and an attractive tax regime. ensuring that ireland remains an attractive place for businesses and workers matters. for workers, i believe one of the biggest challenges relates to the housing market in ireland. consistent undersupply of housing relative to demand has led to difficulties for individuals and households in obtaining affordable housing, whether as prospective property owners or as renters. what is needed is a sustainable level of affordable housing, particularly in the context of a growing economy and population. the central bank of ireland has a specific, narrow role to play in the housing market. as the national macroprudential authority, we are responsible for implementing measures in the mortgage market which have two clearly stated aims : increasing the resilience of banks and borrowers to negative economic and financial shocks, and dampening the pro - cyclicality of credit and house prices so a damaging credit - house price spiral does not re - emerge. our assessment up to now is that the measures have been successful against both of these stated aims and we are currently conducting a review to ensure they continue to meet their goal in the years to come. 8 we will conclude the review later this year. another important aspect for the medium term relates to fiscal policy. government decisions on expenditure and tax revenue can have an important impact on growth, inflation, the labour market and the broader economy. the effect of fiscal policy will be influenced by a range of factors, in particular whether the economy is operating above or below its estimated long - run potential as well as conditions in the international economy. 9 the state ’ s fiscal position started 2022 in a better position than expected previously. with the economy and labour market performing well over recent months, the public finances are well positioned to address the most immediate needs arising from the russian invasion of ukraine, including the necessary humanitarian response. temporary and targeted measures to reduce the impact of higher inflation on those households less able to cope with current circumstances are also appropriate. while our central projections envisage continued improvements in the public finances over the coming years, the outlook is uncertain with significant risks around key determinants of the fiscal position. these include the pace of economic growth, inflation, the likely path of interest rates and the level of corporation tax revenue into the future. as well as short - term pressures, the public finances face challenges from several known medium - term changes that will affect the irish economy and labour market over the coming years

the new approach to financial regulation. another key plank concerns the macro - prudential approach to regulation. the legislation will establish the financial policy committee ( fpc ), charged with the primary objective of identifying, monitoring and taking action to remove or reduce systemic risks with a view to protecting and enhancing the resilience of the uk financial system. in june, the chancellor announced that the government would amend the bill to give the fpc a secondary objective so that subject to being content on the first objective, it should support the economic policy of the government, including its objectives for growth and employment. currently, the fpc is acting in an interim capacity to undertake, as far as possible, the future statutory fpc ’ s macro - prudential role. macro - prudential regulation is focused on protecting the financial system as a whole. in a very “ big picture ” sense, there is nothing new about this activity. the problems of the last five years have emphasised the close links between the health and behaviour of banks and the condition of the economy. this is a lesson of history, and one that should not have been forgotten. but, forgotten it was. at present the fpc is pursuing two important objectives : seeking to increase the resilience of the uk banking system, including to the threats emanating from the euro areas ; and, subject to being content with the path towards greater resilience, supporting the creation of credit in the uk economy. i am in no doubt that if banks take reasonable steps to enhance their resilience, they will be better placed to sustain the availability of credit to the economy by lowering their cost of funding and reducing their vulnerability to unanticipated events. macro - prudential regulation takes a system - wide view of the risks we face and the buffers of capital and liquidity that banks should hold against possible stress events. this is very clearly the resilience objective for the system, to which the fpc attaches great weight. banks in the uk have made substantial progress over the last four years in building that resilience, from of course a very low base. we believe that there is further to go on capital, and the fpc has set this position out, but in doing so we should not forget the distance that has been travelled. we should also remember that more capital cannot be conjured from thin air, particularly as there are at present quite severe constraints around the rate of return earned by banks