Half of finance chiefs want €2bn budget plan

More than half of the country’s finance directors feel the Government should stick with its original plan for a €2bn adjustment in October’s budget.

Despite recent strong exchequer returns and GDP growth figures leading many commentators to suggest that little or no adjustment is actually needed, and Finance Minister Michael Noonan hinting that the €2bn plan is unlikely to be necessary, 52% of chief financial officers still feel the original budget plan is needed.

“Opinion is mixed amongst Irish chief financial officers, in terms of the appropriate adjustment required in Budget 2015. A slight majority feel that the Government should go ahead with the proposed €2bn adjustment,” Deloitte stated yesterday in its latest chief financial officers survey, covering sentiment in the second quarter of the year.

The bulk of the latest survey was conducted prior to some major recent economic data being published. On the back of last week’s better-than-expected exchequer returns for the first seven months of the year, Mr Noonan said if the pattern of strong tax revenue generation continues in the second half, October’s budget adjustment will be “somewhat less than the €2bn originally planned”.

Despite reservations over the budget, the latest survey shows that optimism among chief financial officers has reached a five-year high, with most believing that credit availability is improving and capital expenditure levels are on the rise.

However, while most chief financial officers also believe employee numbers will increase, the cost and availability of talent is increasingly becoming a concern.

Deloitte’s Shane Mohan said the capital expenditure outlook suggests that organisations will invest cash to support growth, “a finding backed up by the fact that chief financial officers continue to cite a preference for investing as opposed to holding cash this quarter”.

He added: “This, coupled with an increased risk appetite, signals a very real shift in the minds of Irish chief financial officers — they are forging ahead with growth plans.”

The latest survey shows a net 62% of chief financial officers are more optimistic about their firm’s financial prospects — the highest level in the five years of the survey and a rise from 50% in the first quarter.