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

On debt sustainability, the word "sustainability" is often used in a colloquial way but in what we are talking about, it has a precise meaning. Debt sustainability means can we meet the repayments or do we have to default. The debt is entirely sustainable on that definition. If one means it will be tough going, it will be hard on people and it is not sustainable because of the pressure, or it is not politically sustainable, that is colloquial use of the language, but if one is talking the language of the market and of investors, our debt is entirely sustainable. A good example to prove it is sustainable is that in the 1980s, in the last debt crisis we had, 20% of our tax revenue was being spent on servicing the debt and at the peak now projected, that will be down to 16%. If we could sustain it in the 1980s and into the early 1990s when the serving costs were 20%, now that it is projected at a maximum of 16% we can see where that is going.

On the Deputy's question on the interest rate, the general Government debt was €144 billion in 2010 and €169 billion in 2011. In respect of the period 2012-14, we project that the debt will be €192 billion, €204 billion and €210 billion, respectively. Interest expenditure in respect of this debt was €5 billion and €5.3 billion in 2010 and 2011, respectively. It is projected to be €6.4 billion this year before rising to €9.4 billion in 2013 and to €9.7 billion in 2014. The large increase next year reflects the expiry of the interest holiday on the promissory note, which was negotiated by our predecessors in Government.

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