Dáil Éireann debate -
Thursday, 25 Jul 1996

Vol. 468 No. 4

Written Answers. - National Debt.

Martin Cullen

Question:

119 Mr. Cullen asked the Minister for Finance the current level of the Irish debt to GDP; if he has satisfied himself with the progress to date in this regard; the plans, if any, he has to achieve the 60 per cent debt to GDP ratio as required by the Maastricht criteria; and if he will make a statement on the matter. [15945/96]

Minister for Finance (Mr. Quinn)

At 31 December 1995 the ratio of Ireland's General Government Debt to gross domestic product, which is the standard measure of a country's indebtedness for EU purposes, stood at 81.5 per cent.

The Maastricht criteria require,inter alia, that in order to qualify for economic and monetary union, a country's general government debt must not exceed 60 per cent of GDP, of if it does, it must be approaching that level at a satisfactory pace. A succession of low budget deficits since the late 1980s, together with increases in GDP, has resulted in a significant fall in Ireland's general government debt to GDP ratio from a peak of 117.6 per cent in 1986 to 81.5 per cent by 1995. Based on the strong performance in recent years, Ireland has been adjudged to have met all the requirements set out in the Maastricht Treaty.

Government policy is to maintain budgetary prudence in order to continue to meet the fiscal criteria set out in the Maastricht Treaty. It is expected that, in the coming years, continued budgetary prudence combined with strong economic growth will yield further significant reductions in the debt ratio, enabling Ireland to continue to meet the Maastricht criteria and make further progress towards the 60 per cent debt/GDP threshold referred to in the Treaty.