Richard Bruton (Dublin North Central, Fine Gael)
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Question 1: To ask the Minister for Finance his latest assessment of the 2008 year end level for the numbers out of work, the shortfall in tax revenue and the Exchequer deficit; and if he will make a statement on the matter. [31744/08]

Joan Burton (Dublin West, Labour)
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Question 2: To ask the Minister for Finance his budget deficit forecast for the year to 31 December 2008; and if he will make a statement on the matter. [31748/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I propose to take Questions Nos. 1 and 2 together.

In early July my Department published a technical economic update which set out forecasts for 2008, based on the latest information available at that time. On this basis, unemployment was expected to average 5.8%, or in numerical terms some 132,000 during 2008. This compares to unemployment of 4.5% or 101,000 over the 2007 period.

At the end of this month, as is usual, my Department will make its six-monthly return to EUROSTAT setting out the overall fiscal position, including the general Government balance for the years up to 2007 and my Department's forecast for 2008. This forecast will take account of the latest fiscal information available at that time.

In announcing the bringing forward of budget 2009, I stated that my Department's latest assessment indicated a tax shortfall significantly in excess of that previously expected for 2008. September is a key month for tax revenue and while we do not have full month data yet, early indications suggest that the poor performance in tax receipts witnessed over the summer months is continuing. My Department is closely monitoring overall tax performance in the run-up to the budget.

My Department will publish an updated view on expected tax and Exchequer positions at the end of this quarter. A comprehensive assessment of the fiscal and economic position will be contained in the budget which will be published on 14 October 2008. As is normal, I will not comment on the contents of the budget in advance of that date.

Richard Bruton (Dublin North Central, Fine Gael)
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In light of today's figures from the CSO, how does it feel to be the first Minister for Finance in 25 years to have to report a recession to the people? Does the Minister still maintain that the collapse we are experiencing in Ireland has to do with international events when the evidence from the CSO today categorically shows that the fall is far more acute in Ireland than in any other country? As recently as last week, every other country still forecast healthy growth in 2008, but we are now in recession and are heading towards very grim figures.

Does the Government accept responsibility for the fundamental change that has occurred in the model that underpinned the Celtic tiger? That model was based on high export growth, tight management of budget balances, high productivity and high competitiveness. Does the Minister accept responsibility in any shape or form for the horrendous decline in the key figures for all of those areas? They were the hallmarks of the Celtic tiger that brought so much success to the country, but they have been destroyed.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I do not accept they have been destroyed, but I accept responsibility as Minister for Finance for ensuring those fundamentals are improved and enhanced in the years ahead. With regard to the cause of our current position, Ireland is an exceptionally open economy and the deterioration in the global climate in the past year has had a major impact here. We are more exposed to global trends than many other economies. The pace of growth in our main trading partners has slowed and this has had an impact on our export performance. The application of the exchange rate also has an effect as a significant part of our trade is outside the euro area. Developments in the euro-sterling bilateral rate are of special importance given our proximity to the United Kingdom.

Joan Burton (Dublin West, Labour)
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We are three weeks away from the budget and various leaks have suggested there will be a deficit of up to €5 billion. The Minister has just said the tax returns for September — I presume the Minister gets weekly or more frequent returns — are continuing. Does this suggest we are now looking at a deficit of up to €7 billion, 7% unemployment and 300,000 people unemployed by the end of the year? Does the Minister agree that now we have the "R" word or the tag "recession" officially added to the tag of the Irish economy? Is this where Cowenomics has brought us? This is what the slump coalition has delivered in 15 months and there are 46,000 more people unemployed since Deputy Brian Cowen became Taoiseach.

Does the Minister agree that it was the stoking of the property bubble by the former Minister for Finance, Deputy Brian Cowen, that caused the Cowen recession in Ireland? We know there is a generally difficult international economic climate, but the Irish recession is worse, steeper and will, possibly, last longer because this Minister's predecessor fed the property bubble with property-based tax breaks long after their sell-by date. Does the Minister agree that the bursting of the property bubble, caused by Fianna Fáil and Deputy Brian Cowen, is the cause of mayhem in our economy and has caused grave uncertainty for a number of our financial institutions?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I am glad Deputy Burton acknowledged a major contribution to the slowdown in our economy has been caused by global factors. She is correct that domestically a major adjustment to the house building sector is under way, with output likely to decline by at least one third this year. There are also strong indications of over supply and in these circumstances a further large reduction in output is in prospect next year. There is growing evidence that the effects of the slowdown in the house building sector has spilled over to other sectors of the economy. I accept that.

I do not accept the suggestion that the Taoiseach bears personal responsibility for the slowdown in the housing sector. The major causative factor for the overheating in the construction sector was the easy supply of credit in recent years here. That is no longer the case, but it was a major causative factor in that phenomenon. That factor has come to an end and we have conditions of over supply. We must deal with the economic challenges we face here and now and not dwell on the possible causative factors for them.

Richard Bruton (Dublin North Central, Fine Gael)
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I agree with the Minister there are difficult external conditions. However, does he suggest that Ireland's falling share in export markets does not have anything to do with what is happening here? Is he trying to say our falling competitiveness does not have to do with what has happened here? Is he trying to say the fact inflation in Ireland was running at almost twice what it was running at in the rest of Europe does not have to do with internal factors? Was the Government not responsible for the management of those factors? Was it not very foolish to increase public spending at twice the rate of growth of the economy? Was it not very foolish to rely on the revenue coming from the property bubble to support those spending figures?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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That is a long list of questions. This country has a solid export driven sector. Our export driven goods and services sector is the mainstay of our economy today and is thriving.

Richard Bruton (Dublin North Central, Fine Gael)
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Did the Minister look at the CSO figures on exports today? They are not growing.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I did. There is some moderation in demand because of the position in other markets, not because of a position created by the fundamental factors here.

Richard Bruton (Dublin North Central, Fine Gael)
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The CSO figures do not show that and no independent commentator would agree on that.

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The fundamental factors regarding exports of our goods and services are soundly based. The difficulties that have arisen have arisen in the construction and banking sectors and have international causes. That situation is visible to all.

Richard Bruton (Dublin North Central, Fine Gael)
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The Government has crowded out our exporters and crowded out people trying to make a living.

Joan Burton (Dublin West, Labour)
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Why does the Minister refuse to publish the pre-budget outlook this year? Last year, when Deputy Brian Cowen was still Minister for Finance, he praised the publication of a pre-budget outlook as a major reform and improvement in transparency and accountability of the public finances. The Minister and his officials must have a very good idea of the spending plans by Department at this time or they do not deserve to be in their jobs. If they were in the private sector and in charge of a major corporation with €56 billion in revenues — falling — coming into the company and could not, four months before the end of the year and three weeks before their budget, tell us the expected figures, they would be sacked. Is the Minister working on a similar strategy to Charlie McCreevy's disastrous trick of introducing decentralisation like pulling a rabbit out of a hat? Nobody knew the figures and it took time to make an assessment of his plan, which turned out to be one of the worst of the many follies and vanities of the Celtic tiger. It caused gross confusion in the Civil Service and significant increases in the number of public servants employed when resources and head offices were duplicated. Is the Minister planning a similar trick for budget day? Will he just pull the figures out of a hat? We are going to hear them as he stands up and the capacity to make an assessment will only be delayed by a few hours. Is he going to waste several vital weeks in terms of setting a course for stability and recovery for our economy?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I assure Deputy Burton that I am not wasting vital weeks. The reason for bringing forward the budget to Tuesday, 14 October is the gravity of the situation in terms of our national finances and this year's deteriorating economic position. That deterioration has been reflected in a sharp reduction in forecast tax revenues. I appreciate that Deputy Burton and, I am sure, Deputy Bruton would wish to be better informed of the fundamental economic framework prior to budget day.

Joan Burton (Dublin West, Labour)
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What about the taxpayers, the people who pay the money?

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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If I may complete my answer, for that reason I will arrange for my officials to fully brief the Deputies on the state of the economy upon the conclusion of the September quarterly analysis by my Department.

Joan Burton (Dublin West, Labour)
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I have a brief supplementary question.

Brendan Howlin (Wexford, Labour)
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I am afraid we are running out of time.

Joan Burton (Dublin West, Labour)
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I wrote to the Minister last week requesting such a briefing. He might have the courtesy to acknowledge that his offer, which I welcome, comes in response to my letter.