Government 'building election war chest'
A surplus of €880 million was shown for the first three months of the year, as tax returns ran about 2.5% ahead of projections.
Economists say borrowing for the year will be close to €1 billion less than projected in the last budget. It should amount to no more than €1.8bn against the figure of $2.9bn forecast by Finance Minister Brain Cowen.
Capital spending is down about €140m for this year and €170m behind the spending pattern at the end of March 2004.
Tax revenue at €9.024m is €221m ahead of expectations, equivalent to 2.5%. The projected increase to end of March was 9.9%, but year-on-year tax receipts are up by 12.6% adding to the view that this year will turn out to be much better than the Government's figures.
For the year, the Government forecasts a 5%-plus increase in tax returns.
But if the present pattern is maintained it will result in a €1bn additional windfall to the State, said NCB Stockbrokers chief economist Dermot O'Brien.
Green Party finance spokesman, Dan Boyle last night said the Government was building a "war chest" for the next general election by keeping cash in reserve and holding back on spending.
The total Exchequer expenditure of €7,540m for the first quarter of the year was €438m less than the Government had forecast it would spend, he said.
Current spending (money spent on services) was €301m less than anticipated and capital spending €137m less.
"The figures are largely positive, but I am a bit concerned that the Government is reverting to its previous pattern of under-spending," said Mr Boyle. "The fear would be that it's to build a war chest to use at a time opportune to the Government."
The money may be used on a spending spree to secure votes ahead of the next general election, due in 2007 at the latest, he said.
Labour Party finance spokeswoman Joan Burton also criticised the Government.
"The responsible thing to do is to spend what they said they were going to spend at the time they said they were going to spend it," she said.
While welcoming the results "in terms of revenue buoyancy", she expressed similar fear about the failure to meet spending targets, saying lack of capital investment could hinder the country's economic performance.
The Government, was "not meeting its own investment targets. This is a matter of basic managerial incompetence and lack of political will," she said.
Fine Gael's Richard Bruton accused the Government of overtaxing the people, saying the figures showed enormous growth in the Government's coffers as a result of stealth taxes and the unreformed tax system.
"Any Government can raise revenue through taxation, but today's figures do not give any indication that our finances are being managed in a responsible manner," he said.
