Quarterly Bulletin Q3 2013

74
EU-IMF Financial Assistance Programme
Quarterly Bulletin 03 / July 13
– Tenth Review
Compliance with Fiscal Targets
Work on the fiscal front also continued in the
first quarter of the year.
The Finance (Local Property Tax) Act 2012 was
signed into law in December 2012, and
amended by the Finance (Local Property Tax)
(Amendment) Act 2013 in March 2013. The
new property tax established under this Act will
be effective from July.
As part of on-going efforts to improve fiscal
transparency, the Revised Estimates for the
Public Service for 2013 were supplemented by
key performance information on outputs and
impacts. In addition, the Central Statistics
Office (CSO) published a new Government
Finance Statistics Report (containing annual
and quarterly general government data).
The quantitative targets for the first quarter
were achieved. The adjusted cumulative end-
March 2013 exchequer primary deficit target
was met by a margin, as was the target for the
outstanding stock of central government debt.
In addition, the continuous performance
criterion on the non-accumulation of external
payment arrears was achieved.
Future Fiscal Targets
The Irish Stability Programme Update (SPU 10 ),
published in April 2013, presents the
Government’s macro-economic and fiscal
projections out to 2016. An underlying General
Government Deficit of 7.4 per cent of GDP is
envisaged for 2013, within the programme
ceiling of 7.5 per cent. The External Partners
noted that “the 2012 fiscal target was
comfortably met and the budget remained on
track in the first quarter of 2013”. However,
they emphasised that the “strict
implementation of Budget 2013 measures,
including in the health sector, is essential” 11 . To
this end, work aimed at containing costs in the
health sector is being progressed. This
includes the publication of a study comparing
the cost of drugs, prescription practices and
use of generics in Ireland with those in
comparable EU jurisdictions, and the
development of an eHealth Strategy. A
successor to the Croke Park Agreement - the
Haddington Road Agreement – is also being
put in place.
The institutional framework is being
strengthened. In line with the new EU fiscal
governance structure, the annual budget is
being brought forward to October. In addition,
the mandate of the Irish Fiscal Advisory Council
(IFAC) will be amended to include the ex-ante
endorsement of the macroeconomic forecasts
on which future budgets and stability
programmes will be based. To support this
arrangement, a memorandum of
understanding will be agreed between the
Department of Finance and the IFAC.
The Ministers and Secretaries (Amendment)
legislation – which will make the already
operational expenditure ceilings legally binding
– is also being progressed.
Compliance with Structural Reforms
The structural reform agenda was further
advanced in the first quarter of 2013.
Steps to improve the environment for job
creation continued with the publication of the
2013 Action Plan for jobs in February. An
evaluation of the employment impact of the
2012 and 2013 Action Plans will be
undertaken, and the results will be used to
inform future policy choices. Work is also
advancing on the development of identified
capital projects in key public infrastructure
areas, such as roads and schools.
The implementation of the Pathways to Work
initiative was further progressed in the first
10 Each Member State in the European Union is required to submit a Stability or Convergence Programme Update to the European
Commission in April of every year.
11 http://www.imf.org/external/np/sec/pr/2013/pr13161.htm