Supplementary Estimates – Back from Committee 9 December 2015
Budget Day 2016 set the expenditure forecast outturn at €54.9bn. This figure included provision for a gross of €1.6bn of supplementary estimates that have now been debated at the relevant committees and are returning to this House today.
The net forecast figure for the supplementaries, the gross figure minus moneys received in A and As such as PRSI, set out in the Expenditure Report on Budget day was just under €1.3bn.
These figures are entirely consistent with Ireland’s obligations under the Growth and Stability pact.
As colleagues understand, supplementary estimates confer legal authority on departments to expend money based on their best estimate of their year end requirements. Departments are not allowed to exceed their supplementary estimate figure but in some cases those figures are not reached.
As a result the agreed supplementary estimates figure can overstate the actual year end requirement.
I am pleased to report that the current forecast out turn, which is provisional and will remain so until the final figures are in, is set to be in the region of €100m in gross terms lower that the forecast in the Expenditure Report.
How does this impact on the public finances?
The general government deficit target for 2015 under the Excessive Deficit Procedure is 2.9% of GDP. Budget 2015 set a deficit target of 2.7%.
In the interim both October and November have seen tax receipts greatly exceed profile. The vast bulk of these receipts are sustainable and confirmed in receipt correspondence between the Revenue Commissioners and my colleague the Minister for Finance.
Accordingly, based on the most recent data available, the end-year budget deficit forecast for 2015 will be in the region of 1.7%, 1 full percentage point below the target set in Budget 2015. This will obviously feed into the starting position for next year and represents a remarkable turnaround on where we were when this Government took office.
This improved economic position has allowed Government to target additional expenditure in areas experiencing increased demand and demographic pressures. I am pleased that we are now in that position.
It would be useful to put the increases provided in the Supplementary Estimates in context. In order to repair the public finances, gross voted expenditure was reduced from over €63 billion in 2009 to €54 billion in 2014. At the same time, while expenditure was being reduced, demographic and other cost pressures arising from increased demand for services still had to be met.
The Supplementary Estimates for 2015 allow for additional expenditure to be directed in particular towards the key areas of health, education and social protection. Funding is provided towards:
• a Summer works scheme to allow work to be carried out on our schools;
• funding for the IDA to support jobs in the regions;
• further capital funds for the Science and Technology Programme and the Programme for Research in Third-Level Institutions;
• a Christmas bonus for recipients of long term Social Welfare payments;
• the health sector for the delayed discharge initiative and Fair Deal scheme, the hospital waiting lists and winter initiative, and roll-out of universal GP services;
• additional expenditure on the Public Transport Investment Programme for the maintenance of the heavy rail network and expansion of the PSO bus fleet, and on the Roads Programme to address critical works on the national road network and improve sub-standard road pavements on regional and local roads;
Therefore the additional expenditure provided by way of Supplementary Estimate represents a responsible approach towards ensuring that public services are adequately funded to meet Government’s key social and economic objectives of protecting the vulnerable in society and creating the conditions to support growth in employment.

