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

The work of the fiscal council is enshrined in law. If it said, "Great Government - throw your hats into the air. Three cheers for the Government.", I do not think it would be doing its job. That does not mean that, while it exercises its independent view, I as Minister for Finance have to agree with it. It made a statement to the effect that we would not meet European fiscal rules. The referee on European fiscal rules is the Commission and the Commission has already said we will meet both of them. The Commission put out new forecasts after the spring statement was published. We knew they were coming out and that they would be more optimistic than the ones we had in the spring statement but we could not prejudge them and had to put in what we had. The argument of the fiscal council is that we will not reduce the structural deficit by more that 0.5% each year, which is the rule, and the spring statement said we would reduce it by 0.3% but it failed to note that, a couple of weeks afterwards, the Commission put out new forecasts. The Commission's view, which it has made public, is that we will not adjust by 0.3% but by 0.8% in 2016, which would be well ahead of the requirement to adjust by more than 0.5% in the year. I do not know why the fiscal council was not aware of that. It is the Commission that decides whether we meet the target or not.

The Irish Fiscal Advisory Council also seemed to imply that we did not take any account of demographic changes but there is €300 million for demographic changes.