Tuesday 21 January 2020

Up to €900m will now be available for next budget

INQUIRY: Michael Noonan. Photo: Tom Burke
INQUIRY: Michael Noonan. Photo: Tom Burke
Kevin Doyle

Kevin Doyle

Almost twice as much money will be available in the next Budget for tax cuts and spending increases compared to what was predicted just a few months ago.

Acting Finance Minister Michael Noonan has revealed that the so-called 'fiscal space' for Budget 2017 will be around €900m - compared to a figure of €500m that was repeatedly quoted during the General Election campaign.

The revelation is likely to fuel demands from Independents who will engage with Fine Gael over the coming days with a view to supporting a minority government.

Mr Noonan told the Dáil that in the region of €10-11bn will be available to the Government over the period 2017 to 2021.

"I stress that this is work in progress and subject to revision. There are many moving parts in the calculation - including inputs from the European Commission that only become available over the summer - and this may give rise to further variations in the figure before budget day," he said.

In what was probably his last speech as Public Expenditure Minister Brendan Howlin said our national debt now stands at the European average.

"Not long ago, some of the parties opposite and indeed some of the economic commentariat were telling us that our debt was unsustainable and would prevent us from raising funds in the markets," he said.

Fianna Fáil's Michael McGrath said the new government should split the €900m in a 2:1 ratio in favour of spending on public services over tax cuts.

"It is Fianna Fáil's belief that the focus for any additional resources should be on improving public services and reversing some of the most damaging cuts, while at the same time outlining a pathway to reforming taxation and reducing the burden on taxation, with a particular emphasis on low and middle incomes," he said.

Irish Independent

Today's news headlines, directly to your inbox every morning.

Also in this section