Michael Noonan (Limerick City, Fine Gael)

The general Government deficit target for 2012, as set by the ECOFIN Council in December 2010, is 8.6% of GDP. The Government is fully aware of the importance of achieving this target in the context of the 2012 budget as well as the views of those who have called for a more ambitious deficit target. The Government is committed to implementing the necessary adjustment package to ensure we continue to meet our targets. I have stated that an adjustment above the €3.6 billion amount already signalled may be required if the 8.6% of GDP deficit target for 2012 is to be achieved. The necessary budgetary adjustment will be implemented through a combination of further reductions to public expenditure and additional revenue-raising measures and will take account of the comprehensive reviews of both current and capital expenditure, which are currently being finalised, as well as the most up-to-date economic and fiscal data available.

The estimate of the 2012 deficit and the level of budgetary adjustment required to meet our deficit reduction target will be set out in the pre-budget outlook, which is scheduled to be published later this month. That document will set out a medium-term consolidation plan for 2012 to 2015 which will indicate the overall composition of revenue and expenditure adjustments for the period. The 2012 budget will be published in early December, as is the norm. Quarter 2 economic data released in recent weeks and budgetary data for the first nine months of the year which were released yesterday were both broadly consistent with expectations. My Department is currently assessing what implications the latest macroeconomic and budgetary data might have for 2012 and beyond. Such assessment will, along with later data, inform Government in the context of its budgetary preparations over the coming months.

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