June exchequer returns show further dip in public finances

[kerrynorth]

The 1st Half figures are out. They indicate a significant deterioration in the public finances with a E2.4billion swing over the 1st half of 06. An E1.427billion deficit in 07 compared with an E880million surplus in 06.

On the revenue side tax revenue has deteriorated further. It is now E129 million below profile compared to just E19million below in May. It is the capital taxes, capital gains and stamp duty, that are most behind profile.

However, the real story is in government spending which is running E3.5billion ahead of June 06 while revenue is just E1.25billion up in the first half of 07.

Although revenue is running below profile it is spending that is the real culprit in the deterioration of the public finances.

[rockofcashel]

why wouldn't it be, when there was a 23% increase in public sector spending in the 6 months up to the election. It's just how they reign in spending like they did after 2002 without the Greens throwing a hissy fit that will be interesting now.

[irishpeoplearewhingers]

Time to curtail spending then?

[rockyracoon]

I have a question: How does this jive with the supposed increase in GDP? Is it the reporting lag time?

[wise_old_owl]

Is the good time all over
My opinion is that it is

[nuj]

I have a question: How does this jive with the supposed increase in GDP? Is it the reporting lag time?

I'm not going to give an economics lesson ...but Government revenues are correlated, on a geared basis, to GDP growth. If the rate of growth falls, or if the components of growth alter significantly, it can have a disproportionate effect on revenues. (This is without even going into the expenditure side of things.)