Wednesday 28 September 2016

The €280m bill we shouldn't be paying

Budget cash under threat from 'Leprechaun Economics'

Kevin Doyle and Colm Kelpie

Published 21/07/2016 | 02:30

Enda Kenny has to find €208m extra to pay the EU
Enda Kenny has to find €208m extra to pay the EU

Ireland is being asked to foot a €280m bill on the back of internationally ridiculed growth figures.

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The so-called 'Leprechaun Economics' statistics, which claimed our economy surged by 26.3pc in 2015, mean we are forced to pay the EU the extra millions.

Jean-Claude Juncker Photo: Reuters
Jean-Claude Juncker Photo: Reuters

Experts around the world dismissed the massive revision as "Leprechaun Economics" and a "farce", as it relates to the activities of Ireland's complex multinational sector.

The unexpected bill means that the €1bn predicted to be available for spending hikes and tax cuts in the Budget is under threat.

And, in a second threat to the Irish economy, a leading UK think tank urged the British government to scrap corporation tax completely in the wake of Brexit, which would undermine Ireland's Foreign Direct Investment policy.

The Central Statistics Office revealed last week that the Irish economy grew by 26.3pc in 2015 - more than three times the original estimate.

The Department of Finance has insisted that the larger EU bill will not reduce the amount of money available for Budget 2017.

However, Fianna Fáil's finance spokesman Michael McGrath told the Irish Independent: "This is real cash which is going to have to be found and paid in 2017.

Colossal

"The colossal increase in GDP does not accurately reflect what is happening in the Irish economy.

"We've reported extraordinary growth but we're not getting the benefits in terms of employment. It's a false economy.

Finance Minister Michael Noonan has already indicated that October's Budget will be based on growth of around 5pc, as the revised figure provoked a bemused international reaction. But as the figure pushes up the value of the Irish economy, at least on paper, then the amount we must contribute to the EU Budget also rises.

Irish Independent

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