A senior official with the International Monetary Fund has said that fiscal councils are "absolutely essential" in ensuring that economic forecasts by governments are reasonable.
Gita Gopinath, deputy first managing director of the IMF, who is in Dublin to give a lecture at the Central Bank, said Ireland had a "very good fiscal council" which was set up after the financial crisis.
She said the Irish Fiscal Advisory Council was fulfilling a "very important role" and was also communicating with the public.
Her comments come as the Irish Government has been accused of ignoring the advice of the fiscal council as the coalition plans to exceed its own 5% spending limit in the Budget next month.
In an interview with RTÉ News, Ms Gopinath said: "Fiscal councils are absolutely essential. It is critical to make sure what every fiscal rules are created do get implemented."
Speaking about the Irish economy Ms Gopinath said: "Ireland is doing very well if you look at the growth that is has had."
"Ireland does need more investment, I think the sector that has the biggest need is the housing sector."
She stressed the need to provide more serviced land to tackle the housing shortfall.
But she warned against relying on windfall taxes from multinationals to fund ongoing investment.
"What is very important to keep in mind is that the large amount of corporate revenue that Ireland has received in recent years is not something that can be treated as being permanently at this level," she added.
"It is going to be transitory, including the Apple money."
"If you look at the construction sector it is not very productive in Ireland."
She said the firms were quite small and more investment needed to be attracted into the sector.
Ms Gopinath said that easing planning bottlenecks was "critical" to deliver housing.
On climate change she said it was something the IMF was dealing with on a daily basis.
"We have many poorer developing countries who did not contribute to the problem but who are dealing with consequences of the problem," she stated.
"We hope that in COP 29 there will be more ambition by governments in terms of tackling climate change."
She said countries were "nowhere near" meeting targets to get to net zero.
"It is the challenge for our generation."
