Seán Sherlock (Cork East, Labour)
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Question 85: To ask the Minister for Finance the recent communications with the EU Commission on the opening of an excessive deficit procedure for Ireland; if the EU Commission has signalled approval, disapproval or otherwise with recent measures to reduce current expenditure for 2009 by €2.1 billion gross; and if he will make a statement on the matter. [6354/09]

Joan Burton (Dublin West, Labour)
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Question 103: To ask the Minister for Finance the forecast Exchequer borrowing requirement for the years 2009, 2010, 2011 and 2012; the position regarding discussions he or his Department officials have had with the EU institutions regarding the possible launch of an excessive deficit procedure; and if he will make a statement on the matter. [6313/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I propose to answer Questions Nos. 85 and 103 together.

The forecast Exchequer borrowing requirement (EBR) and the General Government Balance (GGB — the relevant measure for the Stability and Growth Pact), as set out in the Addendum to the Irish Stability Programme Update which was submitted to the European Commission in January 2009 are in the following table:

The Commission is due to adopt a report on Ireland's budgetary position today, under Article 104(3) of the Treaty which governs the operation of the excessive deficit procedure of the Stability and Growth Pact. This is part of the normal operation of the Pact whenever the General Government Deficit of a Member State exceeds or is expected to exceed the reference value of 3% of GDP. The report relates to the deficit for 2008, as anticipated in the regular fiscal returns submitted to the Commission in October last and the estimated outturn for which was provided in the recent update.

Following consideration of the Commission report by the EU's Economic and Financial Committee, the procedure normally results in the issue of a Council recommendation with a view to supporting the Member State(s) concerned in the pursuit of measures to bring the deficit back within the reference value in a timeframe taking account of the economic background. It is anticipated that the question of Council recommendations in the case of Ireland and of certain other Member States will be considered by Ecofin Ministers within the next couple of months. As is normal in these circumstances, I have been in regular contact with the Commission and with my European colleagues with regard to the position of the public finances.

As the Deputy will be aware, the Government adopted updated fiscal projections in January 2009 based on the end-2008 fiscal position and economic developments. The Addendum to the Irish Stability Programme Update which was subsequently submitted to the Commission — in response to a similar invitation to all Member States — sets out the Government's fiscal consolidation plans which envisage reducing the deficit below 3% of GDP by 2013. Given the severity and suddenness of the downturn and in order to avoid possible further damage to the economy, restoring sustainability to the public finances can only realistically be pursued over a period of up to five years. The Commission has taken note of this.

The European Commission has also noted the recent announcement regarding measures planned to improve the position of the public finances by up to € 2 billion or 1% of GDP in 2009 over and above that contained in Budget 2009. I look forward to the support of the Commission and Council for the overall budgetary strategy of restoring stability to the public finances, while taking steps also to maximise short-term economic activity and employment and improve competitiveness.