Dáil Éireann Debate, Tuesday - 19 July 2016
207. Deputy Michael McGrath asked the Minister for Finance the impact on the fiscal space in 2017, in particular the application of the expenditure rule of the significant revision to 2015 GDP by the Central Statistics Office; and if he will make a statement on the matter. [22627/16]
View answerThe significant revision to 2015 GDP by the Central Statistics Office is not expected to materially change the fiscal space of just under €1 billion for 2017 set out in the Summer Economic Statement. This is because almost all the factors used to calculate the fiscal space for a particular year are fixed on the basis of the European Commission's spring forecasts in the previous year. The Commission adopts this approach to 'fixing' the inputs in order to provide ex ante clarity and certainty to Member States in relation to how their budgetary plans will be assessed.
This means that for 2017 almost all of the inputs to the expenditure benchmark calculation of fiscal space were fixed on the basis of the Commission's spring 2016 forecasts, which were published before the significant revisions to the GDP figures were made by the Central Statistics Office.
Finally, I would point out that policy will be made on the basis of more 'normal' growth rates rather than the exceptional figure for last year, which was distorted by factors which have very little relevance to actual economic developments in Ireland.
