Tom Parlon (Laois-Offaly, Progressive Democrats)

I am speaking this evening on behalf of the Minister for Finance who is attending the ECOFIN meeting in Brussels today.

I very much welcome this motion which endorses the recent measures introduced by the Government to improve the management of public expenditure and underlines the need for continuing effective control of public expenditure in 2003. In my address I will outline the context within which this debate should be approached, as well as dealing with a range of issues relating to the management of the public finances and, in particular, the management and control of public expenditure.

Following a prolonged period of unprecedented economic growth, we now face a more difficult economic environment. Given the nature of our open economy, the prolonged slowdown in global activity has had a major impact. Data for the first nine months of 2002 show an average GNP increase of 1.4% compared to an increase of over 5% for the same period in 2001. As in other developed countries, the lower than anticipated economic growth has created a new environment for budgetary policy. It was this environment which informed the necessarily more restrictive approach adopted in budget 2003.