C&AG report: Coalition ignores €600k report on budgetary policy by advisory council

The body set up to advise the Government on budgetary policy spent more than €600,000 carrying out its work last year, despite the Coalition ultimately ignoring its recommendations.

The Irish Fiscal Advisory Council received €606,000 from the exchequer in 2014, 60% of which was spent on salaries. Outside of salary expenses, a further €100,000 administration fee was paid to the ESRI for accommodation costs and “support services”.

Fees and expenses incurred by the council’s members — which since the resignation of one member in May has comprised of four individuals — totalled €64,000.

The council, which each year critiques the Government’s economic policy and its appropriateness in meeting European budgetary rules, urged the Government to take €2bn out of the economy last year.

IFAC chairman, Prof John McHale, said that it would be “unwise” to shy away from the planned budgetary adjustment and said the Government had no scope to introduce tax cuts.

Its advice fell on deaf ears however, as Finance Minister Michael Noonan and Public Expenditure Minister Brendan Howlin announced spending increases and tax cuts of about €1bn in Budget 2014.

The advisory council was initially opposed to the Government’s plans ahead of this year’s budget too but, earlier this month, did a U-turn endorsing a €1.5bn spending spree as “within the range of prudent policies”.

Despite finding the council’s work to be “of high quality”, the Comptroller and Auditor General offers 16 recommendations as to how it can better perform its role.

These suggestions are broken into how to improve the quality of its work and how to better communicate its reports.

The council should put more stress on long-term financial issues such as the country’s debt sustainability; commission background studies to improve its output; and offer simpler and shorter summaries of its recommendations, according to the C&AG.

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