The assumptions underlying the addendum to the Irish Stability Programme Update 2009 in relation to public sector pay allow for the cost associated with the Review and Transitional pay agreement, agreed in September 2008, over all years of the forecast horizon. Last week the Government decided to defer this pay agreement until 2011, when further discussions will take place. As this decision post dates the publication of the addendum to the Irish Stability Programme this deferment will lead to a saving in 2010. Allowance was also made for changes in the demographic structure which would impact on employee numbers, notably in the case of education, which will impact on the pay bill.
Budget 2009 did not allow for any explicit non-pay deflator in the years 2009 to 2011. In January, however, the non-pay estimates were amended to allow for the costs associated with the higher Live Register and the Pig meat crisis and other pressures. A non-pay deflator (in line with the inflation forecast) was allowed for price increases in 2012 and 2013.
Capital resources are made up of EU receipts, FEOGA loan repayments, the sinking fund provision and certain other miscellaneous receipts. In 2008 €1,398 million was received in capital resources of which, €113.5 million was received in ERDF receipts, €740 million in FEOGA repayments and €488 million for the sinking fund provision.
The forecast for capital resources is €1,579 million in 2009; €1,735 million in 2010; €1,868 million in 2011; €1,961 million in 2012 and €2,046 million in 2013.