Since the referendum result in 2016, a number of steps have been taken to build up the resilience of the economy so that we have the capacity to deal with adverse economic shocks. These include building up our fiscal buffers by balancing our books, reducing our debt burden and establishing the Rainy Day Fund. The steady increases in public spending implemented in recent years with a particular focus on public capital investment, up c. €1.4 billion in 2019, play an important role in supporting resilience in the face of Brexit.
The Government has implemented a number of Brexit related supports over the past three Budgets and also laid the foundation for further supports, pending the outcome of the Brexit negotiations.
Budget 2019 is based on the 'central scenario' that the UK will make an orderly agreed exit from the EU. At that time Budget 2019 also included an estimated impact of a hard exit. The Department of Finance and ESRI recently published an updated model-based assessment of the economic and budgetary impacts. In aggregate terms, after ten years the impact of a disorderly Brexit is to reduce the level of GDP by around 5 percentage points relative to a scenario in which there was no Brexit, with the headline fiscal balance being worse by around one percentage point of GDP.