Pearse Doherty (Donegal South West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

To ask the Minister for Finance the plans, if any, he has to conduct and publish an analysis of the net employment effects of the measures taken in Budget 2012; and if he will make a statement on the matter. [14452/13]

Pearse Doherty (Donegal South West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

To ask the Minister for Finance his plans, if any, to conduct and publish an analysis of the net effect on GDP and GNP of the measures taken in Budget 2012; his plans to conduct and publish any analysis of the output effects; and if he will make a statement on the matter. [14458/13]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I propose to take Questions Nos. 75 and 81 together.

As stated at the time, Budget 2012 was designed in such a way as to encourage sustainable growth and to be as job-friendly as possible. In accordance with this objective a number of sectoral measures were introduced to support employment creation as part of Budget 2012, targeting job-rich sectors such as agriculture and construction.

I would point out that up-to-date employment data are presented in net terms and timely information on gross flows into and out of employment is not available. This unfortunately makes it difficult to assess the number of jobs created by any policy initiative.

Bearing that in mind, recent signs from the labour market have tended towards the positive and sectors targeted by the Government are showing tentative signs of stabilisation. For instance, employment (seasonally-adjusted) increased over each of the last two quarters of 2012, while the standardised unemployment rate based on the Live Register was at 14.1 per cent in February, down from 15.0 per cent a year earlier.

It should be noted that job creation measures are not limited to those contained in the Budget. For instance, research carried out by my Department and published with the Medium-Term Fiscal Statement (November 2012), suggests that the temporary reduction in VAT for the tourism sector, introduced as part of the Jobs Initiative, has had a positive impact on employment growth in this sector.

As the Deputy will be aware, each year my Department publishes the White Paper, detailing pre-Budget estimates of the State’s fiscal position for the forthcoming year assuming no additional policy measures. It is worth noting that without further consolidation Ireland’s General Government Balance, as a percentage of GDP, was projected to remain in double digit figures for 2012, at 10.0 per cent. This would have exceeded the deficit target of 8.6 per cent set under the EU-IMF Programme and is contrasted with an 8.2 per cent projected outturn for last year in the most recent forecasts.

The Government acknowledges that the necessary consolidation can have a negative short-run impact on economic output; however, over the medium term there can be positive effects such as increased confidence and a reduction in the risk premium as the deficit is reduced and debt is put on a declining path. In addition, it must be recalled that Ireland is a small, open economy with imports comprising a large share of final demand. This means that a substantial part of fiscal consolidation leaks out of the economy in the form of lower imports.

My Department continues to monitor high-frequency data to assess the ongoing impact of these consolidation measures on macroeconomic outturn.

Finally, I would point out that figures published this morning show that GDP increased by 0.9 per cent last year, with domestic demand stabilising over the course of the year. This illustrates that the economy can grow even at a time of consolidation.

Pearse Doherty (Donegal South West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

To ask the Minister for Finance the plans, if any, he has to conduct and publish an analysis of the distributional effects of the measures taken in Budget 2012; and if he will make a statement on the matter. [14453/13]

Pearse Doherty (Donegal South West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

To ask the Minister for Finance the plans, if any,he has to conduct and publish an analysis of the distributional effects of the measures taken in Budget 2013; and if he will make a statement on the matter. [14454/13]

Pearse Doherty (Donegal South West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source

To ask the Minister for Finance the plans, if any, he has to conduct and publish an analysis of the distributional effects of the measures being considered for Budget 2014; and if he will make a statement on the matter. [14455/13]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I propose to take Questions Nos. 76 to 78, inclusive, together.

The position is that a distributional analysis of proposed tax measures is provided each year in Annex A of the Budget Book. The distributional analysis is based on tables demonstrating the effects of budget changes in respect of income tax, PRSI and USC on single, married (with and without children), PAYE and self-employed income earners over a wide distribution of income levels. The tables in the Budget Book also demonstrate the effect of changes to some payments from the Department of Social Protection such as Family Income Supplement.

In addition, every Budget Book contains a section which outlines the effect of Budget changes on illustrative cases. These illustrative cases examine the effect of budget changes on various categories of income earners including single, married, lone parents and elderly in a variety of different occupations and with varying income levels and not only demonstrate the effects of the Budget tax changes but also the effect on changes to a number of payments from the Department of Social Protection such as Family Income Supplement, Child Benefit, State Pension and One Parent Family payment were relevant.

I expect that similar distributional analyses will be completed in the context of Budget 2014.