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Budget 2012

Dáil Éireann Debate, Tuesday - 4 December 2012

Tuesday, 4 December 2012

Questions (141)

Stephen Donnelly

Question:

141. Deputy Stephen S. Donnelly asked the Minister for Finance if he will outline all impact analysis on Budget 2012 conducted before and after the budget came into effect; and if he will make a statement on the matter. [53872/12]

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Written answers

With regard to budgetary matters, when focusing on the primary objectives of reducing the deficit and returning sustainability to the public finances, it has been of vital importance to the Government to spread the burden of the adjustments made in as fair and equitable a manner as possible, while also seeking to minimise their negative impact on economic growth. A distributional analysis of proposed budget measures is performed each year based on various income levels for the different categories of income earners, for example single individuals, married one-earner couples with no children and married one-earner couples with children. A distributional analysis which models the impacts on disposable income by income decile using SWITCH, the ESRI Tax-Benefit model, is also undertaken in evaluating various budgetary options. Illustrative examples are contained in the Budget 2012 document. The Deputy might also be aware that an analysis of the impact of the 9% VAT rate introduced as part of last years Jobs Initiative was published in the recent Medium-Term Fiscal Statement.

As part of the broader budgetary framework reform measures, the Comprehensive Review of Expenditure (CRE) was introduced in 2011 as a line by line examination of public expenditure. In particular, it was sought to identify means of reducing expenditure, while minimising the impact on service delivery. The expenditure submissions prepared by Departments as well as other cross cutting thematic papers have been published on the Department of Public Expenditure and Reform website. These give more detail on the analysis underpinning the final expenditure ceilings. The ongoing work of the Irish Government Economic and Evaluation Service also supports Departments in evaluating policy and expenditure options. The central expenditure evaluation unit, CEEU, within the Department of Public Expenditure and Reform promotes best practice in the evaluation of programme expenditure across all Departments and public sector agencies.

The primary objective of Budget 2012 was to reduce further the deficit in our public finances in line with our commitments, since it is not sustainable to continue running such large deficits. On the basis of the most recent data available, it appears that we will meet our deficit targets for 2012. The Government sought to implement the measures required to reduce the deficit in a manner that was as fair and equitable as possible and in a manner that would protect the emerging economic recovery.

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