Pearse Doherty (Donegal South West, Sinn Fein)
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134. To ask the Minister for Finance if his reply to Parliamentary Question No. 208 of 17 November 2015 is still accurate or if the figures contained within it have in any way been recalculated; and if he will make a statement on the matter. [2733/16]

Michael Noonan (Limerick City, Fine Gael)
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Further to the reply provided to parliamentary question 208 of the 17th of November 2015 I can confirm that the information contained within this response, which can be found in Tables A8 and A9 on pages C.50 and C.51 of the Budget 2016 book, is still accurate and the figures have not been re-calculated by my Department. However as explained in parliamentary question 208 of the 17th of November 2015 these amounts are not final and are underpinned by a number of assumptions which are likely to change over time

The Deputy should note that since the publication of this document, the end-2015 Exchequer position has been published and there have been some developments concerning ongoing discussions with the European Commission regarding the States obligations in relation to attaining fiscal targets.

While the end-December 2015 Exchequer returns show that 2015 tax revenue was €3.3 billion ahead of expectations, there will be no consequent impact on the fiscal space available since it was generated by overall economic growth and buoyancy rather than through additional income generated via discretionary measures. Exchequer spending, which is the largest component of expenditure, was in line with Budget day projections and will have little impact on the availability of fiscal space. 

A document outlining the 'Forthcoming Revisions to the Medium Term Budgetary Objective' was published on my Department's website on the 21st January 2016. This explains that the European Commission is currently updating the minimum Medium-Term Objectives (MTOs) of Member States in line with the three-year evaluation cycle. Due to the improvement in Ireland's debt ratio and other factors, it is likely that the MTO for Ireland (covering the 2017-2019 budgetary cycles) might be slightly less stringent than is currently the case. Staff in my Department estimate that, following technical discussions on the matter, a structural deficit of approximately -0.5 per cent of GDP rather than the current target of 0.0 per cent will need to be attained. Should the MTO be readjusted to such a level, thus making it more likely that the MTO will be achieved earlier than currently projected, there would be additional fiscal space in the year after the MTO is achieved. The resulting increase in fiscal space is estimated to be in the region of €1-€1.5 billion.

New fiscal space projections which will take account of updated assumptions, as well as any update to the MTO, will be included in the Stability Programme Update 2016 which will published in April 2016.