Irish Government To Present Unified Budget

by Jason Gorringe, Tax-News.com, London

17 September 2007

Ireland's Minister for Finance, Brian Cowen, has confirmed that all new spending and tax measures will be brought together and announced in a unified way on Budget Day, instead of on a piecemeal basis, as at present.

“These new arrangements represent a major change and a major step forward in my ongoing reforms of the budgetary process," Cowen announced on September 13. "Up to now it has been the practice to announce new public expenditure initiatives on three separate occasions – the publication of the Abridged Estimates Volume in November, Budget Day itself and the publication of the Revised Estimates Volume in the following February. This will now be streamlined into one single announcement of all expenditure policy measures alongside tax changes on Budget Day."

Cowen stated that the 2008 Budget will be announced on December 5, 2007.

Before then, the government intends to publish detailed pre-budget estimates in October of the resources required to maintain the existing level of public services in 2008. These pre-budget estimates will form part of the new Pre-Budget Outlook (PBO), which sets out the economic and fiscal outlook for the next three years.

According to Cowen, this initiative will make it clear to legislators and to the public at large the pre-Budget position, and the additional spending being proposed. It will also help the Dáil (parliament) to focus more clearly on the existing overall level of spending, and what the end results of this spending are, he said.

All policy initiatives involving an increase in public expenditure, above and beyond the “existing level of service” figures, will now be dealt with in Budget 2008, along with the Social Welfare increases and tax measures. In this way, Cowen noted, he is responding to a call from the Dáil’s Public Accounts Committee, which in its October 2005 Report on Estimates Reform asked for a clear distinction between the pre-Budget and post-Budget allocations.

“These streamlined budgetary process will also help me, as Minister for Finance, and the Government as a whole, to manage the public finances in a more transparent and effective manner. Spending and revenue decisions will be made clearer and handled within the framework of the Government’s overall budgetary and economic parameters. In this way, we will ensure that Ireland maintains a sound and sensible fiscal policy, fully in line with the provisions of the EU’s Stability and Growth Pact," Cowen explained.

“Moreover, by coordinating all of our decisions on resource allocation, alongside the tax measures on Budget Day, the Government will be better placed to roll out our ambitious programme of national development and improved public services within a planned, progressive and sustainable framework. This, ultimately, is the approach that will deliver better outcomes and better value for money all round for the public," he concluded.

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