Oireachtas Joint and Select Committees

Tuesday, 7 October 2014

Joint Oireachtas Committee on Finance, Public Expenditure and Reform

Budget 2015: Department of Finance

4:15 pm

Mr. John McCarthy:

This is largely a statistical affect relating to the Haddington Road agreement which came into effect in mid-2013. Government consumption is largely comprised of wages and salaries of Government employees. Essentially, the output value is measured as equal to the inputs. In the case of Government consumption, under the Haddington Road agreement hours worked increased - we are so advised by the CSO and it measures it at about 5% - compared to previous arrangements. That mechanically pushes up the volume of Government consumption because public service workers are working longer. The price of Government consumption has fallen by an equivalent amount because the workers are working more for the same or slightly less pay in some cases. That explains this statistical effect.

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