Seymour Crawford (Cavan-Monaghan, Fine Gael)
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Question 14: To ask the Tánaiste and Minister for Finance his views on the implications of the shortfall in tax receipts to date in 2008 for public policy. [15666/08]

Brian Cowen (Laois-Offaly, Fianna Fail)
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In response to Priority Questions 1 and 2, I have already set out the fiscal position at end-March. In this regard, I would remind you again of the Government's policy. While our fiscal position may have weakened from that envisaged at Budget time, the current situation is manageable given the strong position of the public finances such as our low debt to GDP ratio. Also, the fundamentals of the Irish economy remain strong. This will help us to absorb the housing adjustment and external 'shocks' so that our medium term prospects are favourable. For instance:

our public finances are sound with one of the lowest levels of debt in the euro area;

our markets are flexible allowing us to respond efficiently to adverse developments;

we have a dynamic and well educated labour force;

we have a pro-business outward looking society;

the tax burden on both labour and capital is low.

I wish to stress that the Government accepts that there can be no unnecessary loosening of fiscal policy and, in that context, the implementation of the National Development Plan remains a key priority. As regards current day-to-day expenditure, it is crucial that the agreed budget spending limits are adhered to this year. As I indicated at Budget time, the rate of increase in current spending over the medium term must be managed carefully and kept within available resources. This Government intends to do just that.