New figures show the economy expanded more than previously thought last year and we are closer to reaching the debt targets set out by the troika. This means that the budget deficit, as a percentage of economic output, is now smaller than once feared. But that won’t deter Finance Minister Michael Noonan from making cuts worth around E3.5bn in the next Budget.
The figures from the national accounts for 2011 were published by the Central Statistics Office yesterday. They also show that the income of most people, apart from farmers, continued to fall last year, down by 2.1pc. However, agricultural salaries jumped by 27.1pc.
Spending on drink and food is also rising again after years of sharp declines. The latest figures show we now spend almost as much on alcohol as we do on education. The best estimate now for 2011 gross domestic product is that it rose by 1.6pc in 2011 to E159bn. That has prompted the Department of Finance to reduce its projected underlying budget deficit for 2011 to 9pc of gross domestic product.