END MARCH EXCHEQUER RETURNS
The following statement was issued today (Tuesday 4 April 2000) by the Minister for Finance, Mr Charlie McCreevy, TD.
The attached statement of receipts into and issues out of the Exchequer sets out the position for the first quarter of the year (1 January to 31 March 2000).
The Returns show an Exchequer surplus of £1,009 million (€1,281 million) during the first quarter of 2000. This compares to a surplus of £287 million (€364 million) for the same period in 1999 and a surplus of £1,609 million (€2,043 million) budgeted for the year as a whole. This first quarter is affected by a number of timing and other factors which have resulted in an Exchequer surplus which is proportionately higher than would be expected.
The details are as follows:
Total current receipts in the quarter amounted to £4,690 million.
Tax inflows, at £4,609 million are 22.9 per cent of the Budget day target. The year on year increase in tax receipts is 16.7 per cent for the first quarter, compared to a Budget target of 8.6 per cent over the actual 1999 outturn. The cost of the substantial Budget tax concessions will reduce receipts later in the year but the underlying tax prospect is positive. Based on trends to date, tax revenue for the year as a whole could exceed the Budget target by as much as £500 million.
Income tax inflows are strong with the year on year increase standing at 13.8 per cent. However, with the impact of the Budget concessions coming into effect as the year unfolds, this should fall back somewhat. All tax heads are doing well with particularly strong performances from Capital taxes and VAT.
Total current expenditure in the period amounted to £3,501 million, a reduction of 5.4 per cent on the same period last year.
Current Supply issues in the first quarter were £2,963m. compared to £2,899 million in 1999 - an increase of 2.2 per cent against an estimated increase for the year as a whole of 9 per cent.
As in previous years, spending in the first quarter has been subject to special factors. The lower trend in spending in the first quarter is due mainly to technical and timing factors and is broadly in line with expectations. It does not indicate an underlying improvement in the overall position for the year as a whole.
One of the main factors behind the lower increase in current spending in the first quarter was the timing of European Social Fund (ESF) receipts related primarily to Education spending. ESF receipts of some £50 million by the Department of Education and Science this year have resulted in lower Exchequer issues in the first quarter compared to the same period in 1999 when no ESF transfers were received by that Department.
A number of other factors also contributed to the lower rate of growth in expenditure in the first quarter. Departmental balances in 2000 are £121 million, an increase of £51 million on the opening balances figure of £70 million in 1999. The higher balances reduce the net amount which the Exchequer is required to issue to fund Departmental spending. The balances are the amount which was issued from the Exchequer in 1999, but not used by Departments before the end of the year.
Health spending decreased by 1.8 per cent on 1999 mainly due to higher appropriations-in-aid receipts on the Vote arising from the increase in tobacco excise duty and the increase in the health contribution levy rate from 1.25 per cent to 2 per cent which took effect from April, 1999. Spending on the Agriculture and Food Vote was showing only a marginal increase mainly due to the fact that spending on that Vote in the first quarter of 1999 was boosted by payments under the winter fodder aid scheme which did not arise in the first quarter this year.
which totalled £538 million at end-March, are is in line with expectations. The figure is a significant decrease from the 1999 first quarter outturn of £790 million and is due to lower interest payments resulting from a combination of the effects of the bond exchange programme and the reducing debt levels. In addition, due to timing factors, the first quarter sinking fund payment (which is tied to debt redemptions) is much lower than usual.
Overall, the difference between current revenue and current expenditure in the first quarter gives a current budget surplus of £1,189 million (€1,510 million) compared to a £337 million (€427 million) current budget surplus for the same period in 1999, and a projection of £4,558 million (€5,787 million) for 2000 as a whole.
The capital budget deficit of £181 million at end-March 1999 compares to a deficit of £50 million for the first quarter of 1999, and a deficit of £2,950 million (€3,745 million) budgeted for 2000 as a whole.Voted Capital Expenditure
amounted to £363 million at the end of March, an increase of 13.8 per cent, or £44 million, on the same period last year.
Overall net Voted Capital spending is projected to increase by 34 per cent for the year as a whole. The first quarter issues account for 11.5 per cent of the total for the year, against an estimated profile of 14 per cent. The issues are therefore broadly in line with expectations and conform to the usual pattern of capital spending which tends to be sluggish in the first quarter and picks up as the year progresses.
Non-voted capital expenditure is broadly in line with expectations.
Capital resources at £1,335 million are also in line with expectations. The bulk of this money is the final tranche of receipts from the sale of Telecom Eireann (£1,138m) which has been allocated to the pre funding of future State pension liabilities.
Commenting on the Returns, the Minister said
0The first quarter figures indicate that the public finances are well on target for the year. The tax revenue receipts reflect the strong growth in the economy which is evident from recent statistics, including the reduction in unemployment and the very high level of retail sales, particularly car sales. The expenditure figures appear low but this is due mainly to timing factors and the outturn should be in line with the published estimates.
In my statement on the publication of the end-March 1999 Exchequer returns, I indicated that I had decided not to seek decisions on financial envelopes until after the National Development Plan had been finalised.
Having discussed the matter further with my Government colleagues I am now of the view that the detailed work required to develop financial envelopes would not be warranted at this time. I believe that the allocation of resources over the next three years for most major spending programmes has been addressed in the context of the National Development Plan (NDP) and in the Programme for Prosperity and Fairness (PPF). These documents provide sufficient guidance to most Departments on the level of available resources to facilitate medium-term planning. Decisions on the allocation of resources to the relatively limited programme areas which are not covered by the NDP and the PPF can be taken in settling the annual Estimates.
I remain committed to the principles and benefits of multi-annual budgeting. The Government must have a framework within which it can consider and decide its overall budgetary, taxation and expenditure priorities in a medium-term context. For this reason the no-policy-change projections will continue.
Overall, end-March figures are very satisfactory and I expect that this position will continue for the rest of the year.
|Users who read this document also viewed|
|07 March 2013Report on Recommendations of Internal and External reviews of GG Debt Statistics|
|07 March 2013Department of Finance Annual Review|
|03 January 2013 END-DECEMBER 2012 EXCHEQUER RETURNS Good Exchequer Performance: Taxes Up; Spending on Target The Minister for Finance,...|
|20 February 2003 Recruitment to all Civil Service Departments/Offices is co-ordinated centrally by the Office of the Public Appointments...|
|27 July 1998Freedom of Information|