Bernard Durkan (Kildare North, Fine Gael)
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20. To ask the Minister for Finance the extent to which the various economic fundamental objectives are being met and will be adhered to over the next five years; if he is satisfied that continued prudent economic and fiscal policy is required in the future; and if he will make a statement on the matter. [41738/14]

Michael Noonan (Limerick City, Fine Gael)
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Following the successful conclusion of the EU-IMF programme, the Irish economy has emerged from the crisis and economic recovery is now clearly established.

First estimates of economic activity for the second quarter of this year were very strong and were well ahead of consensus expectations with GDP growing by 1.5 per cent over the quarter and by 7.7 per cent year-on-year. Taken in conjunction with first quarter data, GDP grew by 5.8 per cent in the first half of this year. The increase in economic activity is broad based with both domestic sectors and exporting sectors performing strongly.

Recovery is perhaps most clearly evident in the labour market with employment increasing in each of the last seven quarters, representing an increase of over 70,000 jobs since the low-point in mid-2012.  In line with this, the standardised unemployment rate stood at 11.1 per cent in September, having fallen from a peak of 15.1 per cent in early 2012.

Macroeconomic forecasts for the years 2014 to 2018 were presented by my Department on Budget Day, 14 October. They see GDP growth of 4.7 per cent in 2014 and 3.9 per cent next year. This is driven by a positive contribution from net exports on the back of growth in trading partners. Domestic demand is set to contribute to growth as well, with growing employment and rising household incomes resulting in an increase in private consumption over the period. Over the medium term, GDP growth  of about 3½ per cent a year is anticipated.  To achieve this, we will need to continue to improve our competitiveness, including through upskilling our workforce.

Notwithstanding the current improvement, risks to the outlook remain. These relate to the low inflation observed in many advanced economies, geopolitical tensions as well as the underperformance of the euro area economy.

In terms of the public finances, policy measures implemented by the Government have resulted in a decline in the deficit in recent years.  This decline has been in a phased manner, consistent with the dual needs of supporting domestic activity as well as repairing the public finances.  All of the interim deficit ceilings under the EDP have been met and Ireland is firmly on track to achieve a deficit of below 3 per cent in 2015.  This has been important in restoring Ireland's credibility in the international markets, and bond yields have fallen substantially since the highs of mid-2011. The debt ratio has peaked and is now on a downward path.  After 2015, fiscal policy will be set in line with the requirement to move towards Ireland's medium-term budgetary objective, which is for a balanced budget in structural terms.