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Departmental Budgets

Dáil Éireann Debate, Thursday - 17 January 2013

Thursday, 17 January 2013

Questions (62)

Derek Keating

Question:

62. Deputy Derek Keating asked the Minister for Finance the achievements that he has realised since Budget 2011/2012; and if he will make a statement on the matter. [1771/13]

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Written answers

In terms of the public finances, 2012 was a successful year. We continue to meet our targets under the EU/IMF programme. We have successfully re-engaged with the international bond markets, which has acknowledged Ireland’s Fiscal and Economic progress through a significant decline in the yield on Irish Government bonds, and the economy is projected to grow again for the second consecutive year.

The Exchequer deficit was reduced by over €10 billion during 2012. Excluding the banking measures necessary in 2011, the deficit was reduced by €1.4 billion or 9% in the year. Exchequer revenue of €36.6 billion exceeded target, for only the second time since 2006. This represents a 5.3% year on year growth in revenue on an adjusted basis. A strong outturn in December pushed total tax revenue €271 million (0.7%) over the profiled amount.

The underlying Exchequer expenditure remained within targets (+0.4%) and voted expenditure was down €760 million (1.7%) year on year.

This resulted in the Exchequer primary balance target being met under the EU/IMF Programme for the ninth consecutive quarter since the Programme began in late 2010.

The General Government Balance (GGB) target of -8.6% of GDP looks set to be met with a significant margin. Budget 2013 forecast a GGB of -8.2% of GDP, but due to the strong end 2012 Exchequer figures, this figure may come in below -8%.

Ireland’s recovery was acknowledged in the international bond markets where the yield on Ireland’s benchmark 2020 maturity dropped from 8.26% at end 2011 to 4.43 % at end 2012, and early 2013 witnessed the National Treasury Management Agency’s first syndicated transaction on the markets since January 2010, which sourced €2.5 billion of funds at 3.3%.

In terms of the macroeconomic situation, Budget 2013 is based upon real GDP growth of 0.9 per cent last year and 1.5 per cent this year. The data published since Budget day, including the third quarter Quarterly National Accounts, are consistent with these projections.

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