Counting up the myriad costs of five years of running a budget deficit

The last year in which Ireland did not run a budget deficit was 2007.

In that year, general government expenditure was €68bn which was matched by revenue of €68bn, giving a balanced budget overall.

The outlook for 2008 was described as “uncertain” but the budget announced by Brian Cowen on the Dec 5, 2007 allowed for an 8% increase of spending in 2008, with increases across all areas, as well as reductions in income tax through changes to tax bands and credits. All of this was supposed to result in a budget deficit of less than 1% of GDP because the assumed growth rate facilitated such largesse.