Maureen O'Sullivan (Dublin Central, Independent)
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143. To ask the Minister for Public Expenditure and Reform his views on the IMF projection that Ireland will have the lowest level of public spending to GDP ratio in the entire eurozone by 2021 with current policy trends; and his further views on whether such a low level of spending will have consequences for the future provision of public services and infrastructure. [31356/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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There are a number of issues affecting cross country comparisons of public expenditure both now and in the future:

1. Revisions to Ireland's GDP level for 2015, published by the CSO, highlight that the ratios based on public expenditure as a percentage of GDP must be interpreted with very significant caution.

2. Furthermore, given Ireland's relatively young population, adjusting for the demographic profile of the population also impacts on comparisons with other European countries. This is illustrated on page 14 of the Mid-Year Expenditure Report 2016 which shows adjusted public expenditure in Ireland in 2014 (as a % of GNI) being above the EU average when account is taken of defence and age-related expenditure.

3. Analysis of public spending on a per-capita basis can also provide a different perspective.  A recent analysis by the Nevin Economic Research Institute found that Ireland ranks 10th amongst 11 high-income EU countries when public expenditure, excluding interest, is ranked on a per capita basis. This analysis placed Ireland's public expenditure per capita ahead of per-capita expenditure in the UK.  A comparison based on expenditure as a percentage of GDP would place Ireland's spending below the UK.  

Budget 2017 marked the third year in succession that gross voted expenditure has been increased. Over the period 2015 to 2017 gross voted expenditure has increased by an annual average of 3 per cent. The focus over the coming years must remain on sustainable increases that are affordable both now and in the future. 

There is also a requirement to examine not only the amount of resources allocated towards expenditure but also the impact of this expenditure. In this fiscal context, the ongoing review and evaluation of existing programmes and expenditure, rather than targeting a certain expenditure to GDP ratio, can better support effective delivery of public services.