Vol. 567 No. 6
54 Mr. Coveney asked the Minister for Finance the cumulative percentage growth in current public spending and in tax revenue between 2000 and 2003 to date; and if the divergent trend has implications for the framing of budgetary policy. [14570/03]
Taking account of the forecasts for current expenditure and tax revenue for 2003 contained in budget 2003, current expenditure by Departments and offices will have grown by 51% on a cumulative basis between 2000 and 2003 while tax revenue will have grown by 16.9% in the same period.
Tax revenue growth has slowed because economic growth has slowed. As a result, we will have less resources for new public spending. We are facing the prospect of having to borrow significantly in 2004 and again in 2005. Last December's budget projected that in 2004 and 2005 we would face large and continuing Exchequer borrowing requirements of €3.4 billion and €3.7 billion, respectively. As I stated in my budget speech last December, we therefore have no choice but to move our expenditure, pay and cost levels onto a lower growth trajectory.
This year will see a significant moderation in the growth in public spending. I have also put in place new control mechanisms to ensure that public expenditure is carefully managed to take account of the new reality by being kept within target. It will also be necessary to ensure that the limited increased spending that will be affordable is allocated in a way that best meets the economic and social priorities of the country.
