Changes to be introduced in Tuesday’s Budget could push the deficit figure up slightly
The pre-Budget estimates of receipts and expenditures, published today, project a Government deficit of 2.4% next year, well below its target.
The estimates suggest that the Government would keep within its deficit limit for next year without having to increase taxes or introduce further spending cuts.
For seven years successive governments have struggled with draconian budgets in an effort to correct the public finances and bring borrowing under control, defined as a deficit below 3% of GDP.
Today’s estimates say this year’s deficit will by 3.7% of GDP, and that will fall to 2.4% next year, helped by spending €1.2bn less, and getting an extra €1.3bn in tax receipts.
This will be mostly due to an expected increase in the number of people in work.
Changes to be introduced in Tuesday’s Budget could push the deficit figure up slightly – an extra €500-600 million for spending or tax cuts, as discussed by ministers, would result in a deficit of around 2.7%, still well within the deficit targets.