Tuesday, 29 September 2020

Ceisteanna (319)

Pearse Doherty


319. Deputy Pearse Doherty asked the Minister for Public Expenditure and Reform the projected level of core, Covid-19-related and Brexit-related expenditure in 2021 disaggregated by Department; the projected level of borrowing as a result; and if he will make a statement on the matter. [27355/20]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Public)

On a no-policy change basis, a deficit in the range of -4½ to -5½ per cent of GDP is projected for next year. These figures remains a work-in-progress, with significant moving parts in relation to both revenue and expenditure still being considered in the context of the upcoming Budget 2021. 

Excluding Covid-19 related expenditure, it is estimated that for core current expenditure there are pre-commitments of €1.1 billion, relating to demographics €0.5 billion, carryover costs of Budget 2020 measures of over €0.2 billion, and approximately €0.35 billion in relation to pay costs reflecting the carryover impact of the public service stability agreement.

Further to this, and as announced in the July stimulus plan, capital expenditure would increase from the amount of €8.16 billion for 2020 as set out in the Revised Estimates for Public Services 2020 published in December last year, to €9.16 billion in 2021.    

There will also be an ongoing requirement to provide funding in respect of Covid-19 with, on a no-policy change basis, expenditure required to fund the Health service, meet the carryover costs relating to already agreed measures including the July stimulus plan, the Roadmap for Reopening Schools, and the plan for return to further and higher education. In addition the macroeconomic projections that are currently being worked through will impact on the level of expenditure on income supports next year. It is estimated that there could be a cost of approximately €9 billion in relation to these Covid-19 expenditure costs.

Finally, Budget 2021 will also be prepared on the assumption that the trading relationship between the UK and EU will be on WTO terms in 2021. This will necessitate additional supports for the most affected sectors of the Irish economy next year. The costs associated with these supports will form an essential part of budgetary discussions and details of these costs will be set out in the 2021 Expenditure Report on Budget day.