Belfast Telegraph

Friday 18 April 2014

Noonan hails 1% growth forecast

Finance Minister Michael Noonan said the economic growth forecast showed progress in getting Ireland's finances back in order

The Central Bank has forecast economic growth of 1% this year as Finance Minister Michael Noonan claimed real progress in getting the country's finances back in order.

The tax take for the nine months of 2010 is up 8.7%, or 1.9 billion euro on the previous year and slightly ahead of expectations, according to the Department of Finance.

The improving figures followed a positive Central Bank bulletin forecasting unemployment would peak this year and the overall economy to grow by 1.8% next year.

Mr Noonan said it is encouraging that overall tax revenue is growing again.

"Our economy has returned to growth and notwithstanding the impact of banking related expenditure on the budgetary numbers, the public finances are clearly moving in the right direction," he said.

"Nonetheless, there can be no room for complacency. The deficit in the public finances remains large, despite the recent improvements, and it is crucial that we continue to reduce the gap between our revenues and expenditure in the coming years."

The Department of Finance report on Exchequer figures showed 24.1 billion euro tax for the year to date. Stamp duties were up almost 60% year-on-year due to receipts from the pension levy, introduced to fund the Jobs Initiative, income tax was above target and VAT below.

Overall Government books are 20.7 billion euro in the red mainly due to money poured into banks.

The Central Bank warned Irish-owned business will fall again by 0.4% this year. It estimates that next year Gross Domestic Product (GDP), which includes the value of multinationals, will grow by 1.8%. The Irish-only Gross National Product is expected to rise by 0.7%.

On the jobs front, the Central Bank has forecast the unemployment crisis to peak this year at 14.2% before edging back slightly to 14% next year.

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