Peadar Tóibín (Meath West, Aontú)
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227. To ask the Minister for Finance the size of Ireland's national debt; and the annual repayment and servicing of the debt costs. [40196/20]

Peadar Tóibín (Meath West, Aontú)
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228. To ask the Minister for Finance when he expect Ireland's national debt to be reduced by at least 50%. [40197/20]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 227 and 228 together.

National Debt is the indebtedness of the Exchequer after netting off Exchequer cash balances and other financial assets such as Housing Finance Agency Guaranteed Notes. The National Debt is managed by the National Treasury Management Agency (NTMA). The NTMA’s Annual Report & Accounts 2019 (available at ) provides further details of the breakdown of the National Debt on pages 83-104.

National Debt at end-2019 was circa €188 billion, however, the most comprehensive measure of public debt is General Government Debt (GGD) as it also includes Local Government, extra-budgetary funds, non-commercial state bodies etc. GGD is a measure of the total gross debt liabilities of the consolidated General Government Sector and is compiled based on the European System of Accounts (ESA10) methodology and is used for comparative purposes across the European Union.

GGD at end-2019 was just over €204 billion. Reflecting the impact of the COVID-19 pandemic on the economy and public finances, end-2020 GGD was forecast – in the recent Budget 2021– at just under €219 billion.

National Debt Service (NDS) differs from General Government (GG) interest for a number of reasons. NDS reflects the net interest, fees and operating expenses, on the National Debt prepared on a cash basis. Whereas the GG interest is prepared on an ESA10 accruals basis and represents the projected interest cost of the wider GG measure of debt. The GG interest measure includes consolidation adjustments in respect of interest paid between bodies inside the GG sector and excludes fees and operating expenses which are captured elsewhere in the GG accounts.

NDS in 2019 was €5.2 billion whereas GG interest was €4.5 billion. For 2020, NDS was projected, at the time of Budget 2021, at €4.7 billion while GG interest was forecast at €3.9 billion. Therefore, despite the increase in debt, the interest bill continues to decline. This reflects the favourable funding and interest rate environment, which is underpinned by large-scale ECB monetary policy support, including its asset purchase programmes.

While GGD is expected to increase further next year, the pace of public debt accumulation will need to be slowed once the most acute phase of the pandemic has passed. This will be done by returning the public finances to a balanced position. In this context, the Government will set out – in the spring – a medium-term trajectory showing how the deficit will be eliminated.