Exchequer deficit falls to €1.2bn

THE healthy state of the public finances was underlined again yesterday, when official figures showed the gap between Government revenues and spending had shrunk by almost €1 billion in the first 10 months of the year.

Monthly returns from the Department of Finance delivered the good news that the Exchequer deficit fell to €1.2 billion at the end of October, far below the €2.2 billion at the same time last year and ahead of the Government’s predicted full-year deficit of €2.8 billion. Bloxham Stockbrokers economist Alan McQuaid said the latest figures suggested the Government’s borrowing requirement would be in the region of just €500 million for the year, or €2.3 billion less than provided for in the Budget last December.

Mr McQuaid said the general Government balance, the EU yardstick for measuring the country’s finances under the Stability and Growth Pact that governs the euro, was likely to be in surplus by as much as €700 million. This compared with a predicted deficit of €1.6 billion, leaving the Government balance €2.3 billion better than expected. Government receipts for the 10 months were 12% ahead of last year at €28.6bn. But spending was just 6% ahead and approximately €1.35bn lower than forecast. The figures showed continued buoyancy in income tax, VAT, stamp duty and capital gains tax (CGT). Corporation tax receipts staged a strong recovery, adding almost €480m to the