Fewer than a quarter of professional accountants in Ireland believe the Government will meet its spending targets over the next five years.
The number has almost halved from just three months ago, when 40% felt the Government was on track. But, according to the latest quarterly global economic survey from ACCA (the Association of Chartered Certified Accountants), now only 22% of Irish-based accountants believe that Government spending will be at the right level by the end of 2016.
Perhaps even more worryingly, nearly 60% of those surveyed feel that the Government will, in fact, under-spend. That figure has, over the past three months, shot up by nearly 15%. Additionally, over 25% of accountants feel Ireland will see “dangerous levels” of under-spending in the next few years.
“While the survey points to a pattern of modest recovery in 2012, it is clear that there are many issues and concerns in the Irish context,” said Liz Hughes, head of ACCA in Ireland.
The Irish segment of the survey also found that instances of late payments and concerns of customers going out of business are more common among accountants in Ireland than most other economies. Over 50% of those surveyed said they had seen late payment problems taking a toll on their cash-flows.
On a global scale, however, there was better news from the survey. The percentage of accountancy firms believing the world economy was still deteriorating fell from 73% to 54% in the last quarter and the percentage of those confident of their own firm’s business growth jumped from 16% to 29%.
“Globally, it is too early to say whether the pattern of modest recovery is sustainable, but it seems to rely on a sustained recovery of demand in the west, supply in the east and confidence in sovereigns. It’s a precarious balance,” Ms Hughes added.
However, she warned: “The global economy’s new-found dynamism has come at the price of rising input prices. Therefore, if even a timid recovery is accompanied by rising inflation, then a full-blown recovery is likely to provide a challenge for central banks and other policymakers.”
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