Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

The assumptions are based on the best information we have. Ours is a small, open economy and our assumptions can be turned askew by events elsewhere. However, the forecasting record of the Department in the past couple of years has been better than that of the private-sector forecasters. We do adjust and we are making a slight downward adjustment now because of new information released since I introduced the budget. One can speculate pessimistically or optimistically but we are standing by our forecasts. We predict a growth rate of approximately 1.3% this year and 2.4% next year. I understand the consensus table on forecasting was issued today. It makes exactly the same assumptions as the Department. It identifies a growth rate of 1.3% for 2013 and 2.4% for next year. If we are put off-kilter we will have to think again, but we are pretty confident about our forecasts. The record of the Department of Finance has been very good.

An aspect of the two-pack arrangement is that we will need to have independent verification of our forecasts. The Government, after considering this, has asked the Irish Fiscal Advisory Council to carry out this function. We will probably have to make a minor amendment in legislation to give it statutory power in this regard. In the future, while much of the churning of data and the raw numbers will be done in the Department of Finance, verification will be carried out by the fiscal advisory council. This is in line with one of the requirements under the provisions of the two-pack.