Quarterly Bulletin Q3 2013

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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
EU-IMF Financial Assistance Programme – Tenth Review Quarterly Bulletin 03 / July 13 75 quarter. Intreo offices 12 are being rolled out, with the aim of having up to 43 offices in place by end-2013 and the full Intreo service rolled out to all Department of Social Welfare offices nationwide by the end of 2014. In tandem with this, the number of case managers is being increased. The State Bodies Group (SBG) developed a work programme for 2013 in the first quarter, which includes a rigorous scrutiny of the credit environment for SMEs. The Credit Review Office (CRO), whose resources were increased recently, will continue to monitor the enforcement of AIB’s and BOI’s 2013 SME lending targets. The National Pension Reserve Fund (NPRF) will roll out three new SME funds. Progress is also being made in other key areas, including the water strategy, the sale of state assets in the energy sector, and establishing the new training and further education authority and Education and Training Boards. On the labour market reform front, a report reviewing the impact of reforms to sectoral wage-setting mechanisms is being prepared. EU/IMF Loan Disbursements to Ireland to Date The nominal amount of loans under the EU/ IMF Programme, as of 30 June 2013, amounts to €62.1 billion. (The net euro amount received by the Exchequer - which takes account of any adjustments for below par issuance, deductions of a prepaid margin, and the effect of foreign exchange transactions - was some €61.4 billion). Successful completion of the tenth review of the programme allows for the disbursement of a further €2.5 billion (€1.0 billion from the IMF (which was disbursed on 27 June), €1 billion from the European Financial Stability Facility (EFSF) and €0.5 billion in bilateral loans). Following the draw down of this tranche, just under €63 billion - some 93 per cent of the total external financing of €67.5 billion available under the programme - will have been drawn down. 12 The Intreo offices provide a one stop point of contact for all employment and income supports.
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JULY 13 Q3 Central Bank Quarterly B
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Contents Section 1 Forecast Summary
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Section 1 Quarterly Bulletin 03 / J
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7 Comment Annual National Accounts
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9 The Domestic Economy Overview n A
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The Domestic Economy Quarterly Bull
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Page 25 and 26: The Domestic Economy Quarterly Bull
Page 33 and 34: 31 An Timpeallacht Gheilleagrach Le
Page 35 and 36: 33 Financing Developments in the Ir
Page 37 and 38: Financing Developments in the Irish
Page 55 and 56: 53 Developments in the Internationa
Page 57 and 58: Developments in the International a
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Page 75: EU-IMF Financial Assistance Program
Page 79 and 80: 77 Developments in EU Financial Ser
Page 81 and 82: Developments in EU Financial Servic
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Page 87 and 88: Analysis of Recent Monetary Operati
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Page 107 and 108: Statistical Appendix Quarterly Bull
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Quarterly Bulletin Q3 2013

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