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Finance Minister Paschal Donohoe rules himself out of eurozone bailout fund post as a record €58bn tax collected


Finance Minister Paschal Donohoe. Photo: Frank McGrath

Finance Minister Paschal Donohoe. Photo: Frank McGrath

Bailout boss Klaus Regling

Bailout boss Klaus Regling


Finance Minister Paschal Donohoe. Photo: Frank McGrath

Finance Minister Paschal Donohoe has ruled himself out of the running for a job at the head of the eurozone bailout fund.

After initially pleading “no comment” to the question, he told the Irish Independent he is “not a candidate” to succeed Germany’s Klaus Regling at the helm of the European Stability Mechanism (ESM), the €500bn bailout fund for euro countries.

“I am not a candidate for it,” he said on the fringes of an EU finance ministers meeting in Luxembourg. “My focus is on trying to get a candidate for it.

“I’m putting a huge amount of time into trying to find somebody to do the job, who can be acceptable to other countries, but that is other people. I am not a candidate. I’m the person overseeing the process to get the job done.”

As head of the Eurogroup of 19 finance ministers, Mr Donohoe is responsible for finding a successor to Mr Regling, whose term as managing director of the ESM expires on Friday.

He has been in the role since the formation of the ESM in 2012. The institution is the successor to the temporary bailout fund that Ireland tapped in 2010.

But finance ministers have been struggling to elect anyone because candidates require 80pc of the Eurogroup to agree, a threshold that has so far been impossible to meet.

Mr Donohoe said “a number” of people have since thrown their hats in the ring, adding that he hopes to “make progress” at an ESM board meeting tomorrow.

“There’s less than 19 (candidates) but more than zero,” he said.

Speculation about Mr Donohoe potentially taking up the role follows a simmering row in the Coalition about whether he should keep his title as president of the Eurogroup of finance ministers, whose meetings he chairs once a month. That position has traditionally gone to a sitting finance minister.

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Mr Donohoe has resisted fuelling speculation on whether he will be allowed retain the role after the coalition reshuffle in December.

Meanwhile, the public finances further improved in September, with an additional €1.6bn in taxes collected during the month compared to the same time last year.

That revenue was flowing in as ministers finalised Budget 2023, with total tax receipts for the year to date now standing at a record €57.9bn.

As things stand, the Government has collected an additional €12bn – or 26.2pc – of taxes than in the same period in 2021, the bulk of the improvement paid by multinationals. An Exchequer surplus of €7.9bn recorded for the year to the end of September compares to a deficit of €6.2bn at the same point a year ago.

As well as more tax, the figures show a decline in voted current expenditure due to the unwinding of Covid-19 supports.

On a 12-month rolling basis, a better indicator of the trend, the Exchequer surplus stands at €6.8bn.

The Department of Finance has forecast a full-year surplus of €4.45bn – the key factor in last month’s give-away Budget announcements by Ministers Paschal Donohoe and Michael McGrath, if corporate tax continues to run significantly above even revised forecasts that might improve further.

Corporate tax isn’t the only factor driving the improvement in the State’s overall position.

With record numbers at work, income tax receipts of €2.2bn were recorded in September, €300m ahead of September 2021. September is a Vat-due month, and receipts of €3.1bn were collected, another €500m better than in the same month of 2021.

Almost every tax heading is running ahead of last year, while the Central Bank and the National Assets Management Agency
(Nama) have continued to send their surplus income back to taxpayers.

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