Minister’s Brief

Recommendations

Info

3.1.2.1 Macroeconomic analysis and forecasting Principal Officer: Feargal O’Brolchain John McCarthy Chief Economist Feargal Ó'Brolcháin Principal Officer Macroeconomic Analysis Laura Weymes Assistant Principal Labour market, supply-side forecasts, technical aspects of public finances/ageing. Vacancy Assistant Principal Irish Macro Economy including forecasts Javier Papa Assistant Principal International macro, nominal developments, OECD engagement Key Points: Domestic economy GDP rose by 7.8 per cent last year. The 2016 Budget is based on a GDP growth rate of 4.3 per cent this year. The domestic data-flow remains relatively strong but, internationally, there are very real concerns regarding prospects for the global economy and, in particular, for Emerging Market Economies (EMEs), including China. Risks to the central forecast are firmly tilted to the downside, especially for the second half of the year and into next year. The labour market continues to perform reasonably well, with the unemployment rate currently just under 9 per cent (compared to a peak of c. 15 per cent). Inflation in Ireland was -0.1 per cent in 2015. The absence of inflation – in Ireland and elsewhere – is becoming very problematic. The Department’s next forecast, which must be endorsed by the Irish Fiscal Advisory Council, will be published in the Stability Programme Update which, under legislation, must be submitted to the European Commission by end-April. Page 14 of 184
Detail: Economic Outlook Preliminary figures show that GDP rose by 7.8 per cent last year and was projected in the Budget forecast to expand by 4.3 per cent this year. Growth is reasonably balanced with both domestic demand and exports making positive contributions. The Budget projected GDP growth of 3.5 per cent next year. Revised forecasts are due to be published in the Stability Programme Update which all MS must submit to the European Commission by end-April. Under the new European architecture, these forecasts should be endorsed by the Irish Fiscal Advisory Council, and there is always a risk that the IFAC will not endorse the projections. At the time of the Budget, risks to the forecast were identified as being tilted to the downside. Since then it is clear that downside risks have increased, mainly due to external developments. In 2015, Global GDP grew at the slowest pace in five years (at 3.0 per cent) and according to the OECD, it is not expected to improve in 2016. China has been a key driver of global economic growth in recent years and the ongoing slowdown there is dampening global demand, especially for those countries with strong trading links to China. In particular, growth is slowing in many emerging market economies (EMEs), especially for commodity exporters who have been hit by low commodity prices. Pessimism regarding short-term global prospects is not confined to EMEs. In the euro area the pace of economic recovery remains moderate notwithstanding significant support from low oil prices, the euro’s exchange rate and lower financing costs. Legacy effects of the crisis – high levels of NPLs in some MS, limited access to credit, high levels of public and private indebtedness, etc. – continue to weigh on prospects in some Member States. Growth held up in recent quarters in the UK, US and the euro area but the outlook appears uncertain with risks tilted to the downside. A sustained slowdown in EMEs together with (in the case of the US) the appreciation of the exchange rate are potential headwinds. The forthcoming ‘Brexit’ referendum in the UK will add to uncertainty and is already having a detrimental (from an Irish perspective) impact on the euro-sterling bilateral exchange rate. Labour market conditions continue to improve with employment growing by 2.6 per cent in 2015 and the unemployment rate falling to 9.1 per cent by end-year. Revised estimates of the monthly unemployment rate indicate a figure of 8.8 per cent in February. There have now been 13 consecutive quarterly of employment growth with this growth broadly based across the economy. Wage pressures appear relatively modest. Consumer price inflation is virtually non-existent in Ireland and elsewhere (at least in advanced economies). In the euro area, the ECB has failed to achieve its inflation target (close to 2 per cent) for four years, and inflation expectations have become deanchored. This is hugely problematic, especially in an environment of high Page 15 of 184
Page 1 and 2: Minister’s Brief 2016 s Page 1 of
Page 3 and 4: 3.2.1.1 Policies on Mortgage Arrear
Page 5 and 6: 1. Introduction For the purposes of
Page 7 and 8: 2.1 Economic and Fiscal Directorate
Page 9 and 10: 2.2 Finance and Banking Directorate
Page 11 and 12: 3. Detailed Briefing Page 11 of 184
Page 13: 3.1.2 Economic Division Description
Page 17 and 18: 3.1.2.2 Microeconomic analysis unde
Page 19 and 20: changes in the relevant tax base) a
Page 21 and 22: 3.1.2.3 Economic coordination inclu
Page 23 and 24: 3.1.2.4 Budgetary/fiscal policy, go
Page 25 and 26: Assessment of compliance with SGP o
Page 27 and 28: was a deviation from the fiscal rul
Page 29 and 30: tax, followed by personal income ta
Page 31 and 32: Tax Strategy Group - What Does It D
Page 33 and 34: Detail: Income Tax Policy Income Ta
Page 35 and 36: Credit in 2014 - that credit was of
Page 37 and 38: INCOME TAX INCENTIVES Agri-Taxation
Page 39 and 40: Marine taxation In Budget 2016, a r
Page 41 and 42: Detail: Indirect Tax Policy Tax Hea
Page 43 and 44: outcomes, then it was proportionate
Page 45 and 46: More fundamental threats to tobacco
Page 47 and 48: 3.1.3.4 Finance Bill co-ordination,
Page 49 and 50: ise in both equity markets and prop
Page 51 and 52: Tax Head 2007 (€m) 2013 (€m) 20
Page 53 and 54: 3.1.3.5 International taxations, co
Page 56 and 57: fully in line with the new OECD req
Page 58 and 59: 3.1.5.1 EU Economic Governance issu
Page 60 and 61: At EU level, the Governance section
Page 62 and 63: 3.1.5.2 EU-IMF Post Programme Monit
Page 64 and 65:
2. EU Funding Mechanisms/ Programme
Page 66 and 67:
Detail: The EU Strategy Unit manage
Page 68 and 69:
3.1.5.4 International Relations Uni
Page 70 and 71:
3.1.5.5 Permanent Representation of
Page 72 and 73:
3.2 Finance and Banking Directorate
Page 74 and 75:
3.2.1.1 Policies on Mortgage Arrear
Page 76 and 77:
available is €1.8 million. Initia
Page 78 and 79:
3.2.1.2 Policies on Central Bank po
Page 81:
deemed necessary, it may be prefera
Page 84 and 85:
Detail: Key Initiatives to achieve
Page 86 and 87:
5. Majority of credit requests cont
Page 88 and 89:
3.2.2 Financial Services Division D
Page 90:
A further group is reviewing the re
Page 93 and 94:
financing would be available to cov
Page 95 and 96:
o Cumulative impact of financial le
Page 97 and 98:
3.2.2.2 National and EU policy and
Page 99 and 100:
Securities The draft EU Prospectus
Page 101 and 102:
In addition a full view of the fina
Page 103 and 104:
"packaging", wrapping or bundling t
Page 105 and 106:
3.2.3 Shareholding Management Unit
Page 107 and 108:
3.2.3.1 State’s Banking Investmen
Page 110 and 111:
3.2.3.2 State’s shareholding in A
Page 112:
sheet continues to contract, albeit
Page 118 and 119:
3.2.3.4 NAMA Specialist - Declan Re
Page 120 and 121:
Detail: NAMA Background As part of
Page 123 and 124:
3.2.3.5 IBRC (in special liquidatio
Page 125 and 126:
In February 2013 the Irish Bank Res
Page 127 and 128:
3.2.3.6 State’s shareholding in P
Page 129 and 130:
PTSB’s return to profitability ha
Page 131:
Credit Union Restructuring Board (R
Page 134:
3.2.3.8 Management of all legal mat
Page 137 and 138:
3.2.4.1 Risk and Financial Stabilit
Page 139 and 140:
• development and maintenance of
Page 141 and 142:
epresented and an Industry Advisory
Page 143 and 144:
3.2.4.1 Management of FoI and PQ pr
Page 145 and 146:
Page 145 of 184
Page 147 and 148:
3.2.4.1 Liaison with the Attorney G
Page 149 and 150:
3.2.4.2 Management of the Accountan
Page 151 and 152:
Future Developments The vote accoun
Page 153 and 154:
3.2.5 International Financial Insti
Page 155 and 156:
Key Points: International Monetary
Page 157 and 158:
with the delegation led by Second S
Page 159 and 160:
assistance to the developing world.
Page 161 and 162:
In addition to capital contribution
Page 163 and 164:
would be the Minister for Finance o
Page 165 and 166:
3.3 Corporate Page 165 of 184
Page 167 and 168:
supported by OPW and a number of ex
Page 169 and 170:
3.3.2. Corporate Affairs Descriptio
Page 171 and 172:
member, the Department has a Busine
Page 173 and 174:
ability of both electronic files an
Page 175 and 176:
3.3.3. Human Resources Division Des
Page 177 and 178:
Detail: 1. Organisational Structure
Page 179 and 180:
effectively to improve and deliver
Page 181 and 182:
The Department is currently reviewi
Page 183 and 184:
Erosion of income tax base did not
show all

Minister’s Brief

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?