Budget spend of €2.7bn needed, says think-tank

The Government will have €2.7bn to spend on Budget Day, according to the country’s leading think-tank.

The Government will have €2.7bn to spend on Budget Day, according to the country’s leading think-tank.

In its Quarterly Economic Commentary, the Economic and Social Research Institute (ESRI) predicted that next year would see increased spending by consumers reaping the rewards of their SSIA saving schemes.

And experts also said a strong jobs market and healthy increases in wages would boost consumption.

The ESRI estimate around 11% extra revenue, or €5bn, will be available to Minister for Finance Brian Cowen in 2007, compared to 2006.

However economists suggested 8.5% more expenditure will be needed to fund services, including welfare services, next year.

The ESRI said this amounts to €3.3bn and is €6m higher than the budgeted figure.

The group’s leading economists said consumption would grow strongly in 2007, at a rate of 7.4%.

They claimed this is due to a combination of maturing SSIAs, strong employment growth of 3.5% and nominal wage growth of 5.5%.

The think-tank said strong growth is likely to produce increases in VAT and excise revenues of more than 10% in 2007 and its forecast for strong growth in employment led them to estimate a possible increase in excess of 6% in income taxes.

more courts articles

Man (25) in court charged with murdering his father and attempted murder of mother Man (25) in court charged with murdering his father and attempted murder of mother
Man appears in court charged with false imprisonment of woman in van Man appears in court charged with false imprisonment of woman in van
Man in court over alleged false imprisonment of woman Man in court over alleged false imprisonment of woman

More in this section

FILE PHOTO The Competition and Consumer Protection Commission has cleared the purchase of Goodbody Stockbrokers by AIB END Goodbody Stockbrokers fined over €1.2m by Central Bank over rules breaches
Nottingham City Centre Stock Irish staff at the Body Shop wait for wages as retailer shuts stores in the Republic
Ryanair comments on Norwegian Ryanair boss O'Leary's spat with Transport Minister over Dublin Airport escalates
IE logo
Devices


UNLIMITED ACCESS TO THE IRISH EXAMINER FOR TEAMS AND ORGANISATIONS
FIND OUT MORE

The Business Hub
Newsletter

News and analysis on business, money and jobs from Munster and beyond by our expert team of business writers.

Sign up
ie logo
Puzzles Logo

Play digital puzzles like crosswords, sudoku and a variety of word games including the popular Word Wheel

Lunchtime News
Newsletter

Keep up with the stories of the day with our lunchtime news wrap.

Sign up
Cookie Policy Privacy Policy Brand Safety FAQ Help Contact Us Terms and Conditions

© Examiner Echo Group Limited