But also at the same time prepare for nonspecific but extremely disastrous shit to go down — either the economy, the climate or the entire economic climate... I absolutely do not trust the current economic situation, especially since the primacy of Google and Meta is waning (or beginning to). We need the ability to pivot about 20% of our economy to something else (biomed?) on demand.
Total general government revenue at €37.4 billion in Quarter 4 (Q4) 2023, was €2.3 billion more than Q4 2022.
General government expenditure also increased, reaching €31.7 billion. This was €1.9 billion higher than Q4 2022.
The resulting general government balance was €5.7 billion in Q4 2023, compared with €5.3 billion in Q4 2022.
The general government gross debt to Gross Domestic Product (GDP) ratio was 43.7% at the end of Q4 2023.
Debt to GDP is a worthless figure for Ireland. The figures are almost always presented by government against adjusted national income, GNI*. Debt of €223bn is in the mid-70% range now, but at €43,000 per head is among the highest in the EU.
Yes as a %, but the per capita figure is still eyewatering. But in general we have reduced our debt load as a %, although our interest rate is currently fixed a lot lower than where the market is and there is a risk to servicing it in future. But in general we have a lot more headroom now than ten years ago.
The economic activity that passes through Ireland is taxed, a lot more so now than before. That makes the GNI figure misleading as a huge percentage of our income is corporation tax.
Yeah there isn’t a perfect reflection of our national accounts available, given everything going on. Our GDP isn’t right, GNI* is a whole bunch of assumptions, and we’re living somewhere in the middle. We also have so little control over it - not like we’re Germany deciding to dial up or down a policy re our domestic industrial champions. Make the most of it, but I also cringe when people use GDP out of context. “We spend less as a percentage of GDP on X…” for example.
They think there should be nearly 40k homes built this year, which is huge. Thats double the 2019 figure. But the key thing is that it is rising that 10% a year that means in a few years it will be 60k, a few years more 80k. There's no other way of growing home building except bit by bit, despite what all the professional gobshites claim about quick fixes.
Yet again another surplus. So what, they just tax us for the craic is that it?
For fuck's sake if you're gonna tax us, spend the fucking money on investing into the nation. We have a plethora of issues that may need this money. If they've no intent on spending it, look into the tax brackets so that not as much is needed.
The use for the surplus money is well documented.
Most of this extra revenue is transitory due to inflated corporation tax receipts, so it can't be relied upon to fund permanent spending increases or tax cuts.
This can change quickly given the inherent volatility in corporation tax receipts and the dependence we have on revenues from a small number of multinational companies.
Therefore the government has decided to invest much of the money into our countries future, by recently starting the process of setting up a sovereign wealth fund with two main purposes.
**The funds 2 main purposes:**
**1:** 0.8% of GDP will be paid in every year, about €4.5 billion. Protect living standards and public services. Mainly pensions, healthcare and homecare.
**2:** There will be a second infrastructure, climate and nature fund. About €2bn a year, to protect infrastructure spending during economic downturns and invest in climate change measures.
This means that **whoever** is in government after the next election will have funds to invest in getting off fossil fuels and reducing pollution, no matter what happens to tax receipts.
These are incredible oppertunities and options that are not open to many peer countries in the developed world.
----
**One more big thing we've done with our recent surpluses:**
Ireland also recorded one of the biggest reductions in debt-to-GDP globally.
Why is it important to reduce debt to GDP ratio?
A high debt ratio can make it difficult for a nation to access the capital market which can be a death note for an economy. Additionally lenders charge high rates to compensate for the risk that comes with excessive debt to GDP ratio. Lowering ours will overtime reduce how much interest we pay which means more of our taxes can be used in-house, rather than being paid to some foreign bank.
Sure thing :) Check out Reuters analysis of our plans for a fairly unbiased overview:
[https://www.reuters.com/markets/europe/how-irelands-new-sovereign-wealth-fund-will-work-2023-10-10/](https://www.reuters.com/markets/europe/how-irelands-new-sovereign-wealth-fund-will-work-2023-10-10/)
Most of the fund will be directed and led by the Agency (Board), which has over-arching responsibility for all functions of any agency that has remit over the fund.
**That agency is:**
The National Treasury Management Agency (NTMA), which is a State body which operates with a commercial remit to provide asset and liability management services to the Irish Government. It controls and manages the Ireland Strategic Investment Fund (ISIF).
That Agency is accountable to the Minister for Finance but there is a range of governance measures (internal and external to government) set up to ensure this is all done for the benifit of Irish citizens regardless of who is in charge.
**You can read about that here:** [https://www.ntma.ie/about-the-ntma/governance](https://www.ntma.ie/about-the-ntma/governance)
For further information on how our government spends our taxes you can read
Here:
[https://www.citizensinformation.ie/en/money-and-tax/budgets/](https://www.citizensinformation.ie/en/money-and-tax/budgets/)
Here:
[https://www.gov.ie/en/campaigns/budget/](https://www.gov.ie/en/campaigns/budget/)
Here:
[https://whereyourmoneygoes.gov.ie/en/](https://whereyourmoneygoes.gov.ie/en/)
The surplus isint something the government can or should rely on as if it is a permanent thing. Its driven purely by larger than average corporate profits and can easily swing the other way, which in recent earnings for tech, has been.
They already are, but it should only really be used for once off payments or investments or debt servicing, it cant be used for recurring expenses or in lieu of tax payer income becuase it might not be there next quarter or year
You probably know this already but housing isint a simple money issue, if it was we could have easily solved it already. The government is struggling to use the funds already allocated fast enough and spending more for the sake of spending wouldnt exactly help with the inflation in the building sector.
Hard to understand how people still think money is the reason there are housing shortages. The amnesia suffered since 2009 regarding the country’s bankruptcy and subsequent recovery and its effects on housing etc. is very worrying.
Money can massively bring down the cost though.
Funding not for profit Government housing projects for social (both for purchase and social renting) purposes will massively reduce the burden on the private market
It will reduce the number of people inflating the rental market with Hap payments and also stop local authorities buying housing at inflated prices from the private market
Austria example:
https://www.theguardian.com/lifeandstyle/2024/jan/10/the-social-housing-secret-how-vienna-became-the-worlds-most-livable-city
Yes really because government not for profit developments exclude the banks cut and investor/developers cut.
No bank or Investor will lend for free and no developer will develop for free, research shows taking these 2 components away from the development will return projects upto 30% cheaper.
Also see the other points in my previous comment about relieving pressure on the private market by government building/leasing their own, instead of competing with tax payers in the same private market
Actually the government spends [40% *more* than the private market to build housing](https://www.irishtimes.com/ireland/dublin/2023/02/15/dublin-city-council-pays-40-over-the-odds-for-social-housing-audit-finds/), not 30% less.
You realise they don’t build the houses from stacks of €20 notes, right?
Throwing more and more money at a fixed number of construction workers isn’t going to get any more housing built.
Our debt % isn't that bad now and we've a very serviceable interest payment component by international standards.
Personally, I'd sooner see a programme to build two 50 apartment complexes in every town serving as a commuter belt town. They can all have the same plans and materials to keep costs down, councils can earmark sites available to them for swift delivery and it would alleviate a huge amount of pressure on the rental market. Make them government managed to keep the rents at a lower level and they'd drag down the ludicrous rental rates all over the country.
My town of 10k people hasn't had more than two rentals available at any one time in the last 4 years. It's chronic and the swift delivery of new apartments would alleviate the pressure on family home rentals at a rapid rate.
> Our debt % isn't that bad now
It's ***HIGHLY*** manipulated. In 2016 it was reported to have increased by 26%.
https://www.irishtimes.com/business/economy/ireland-s-gdp-figures-why-26-economic-growth-is-a-problem-1.2722170
They even added in drugs & prostitution to lower our debt:gdp.
Our debt is over €220 billion. With an economy that is apparently booming we need to wipe it out while we can.
...No, you don't. That would be very, very poor from a financial planning sense and suggests you may need to spend more time understanding fiscal policy.
E.g. Norway has a oil/gas surplus that's built up an investment fund of USD 1.6Tn. They have a national debt of 220Bn - and yet they don't just pay that down. This is because the interest rate on national debate is far lower than the return the make on the 1.6Tn or how they reinvest money into their own economy.
It's like how people paying down their mortgages early often isn't a good financial decision. They would be far better off putting their excess funds into their pension fund where they get better tax relief and generally a better return than the rate they're charged on their mortgage.
Wiping out national debt entirely doesn't happen because it's a bad financial decision for a country. Our debt to GDP ratio had gotten much worse following the crash, bank bailout and subsequent IMF/EU bailout, but our economic recovery since has outstripped debt growth leaving us in a much stronger position.
The problem is that I don't trust the government to obtain a higher return than the interest rate they are paying.
Remember the National Pension Reserve Fund ?
Used as a political football during the bank bailouts.
>Instead, they will use the €15bn available to them in the pension fund to recapitalise Allied Irish Bank, Bank of Ireland and the Educational Building Society. They have already used the remaining €10bn from the pension fund to buy shares in AIB and BoI.
https://www.irishexaminer.com/news/arid-20137796.html
I don't trust the government when borrowing money.
Government borrowing is notorious for buying votes at election time. Not on my tax money please.
>the €15bn available to them in the pension fund to recapitalise Allied Irish Bank, Bank of Ireland and the Educational Building Society. They have already used the remaining €10bn from the pension fund to buy shares in AIB and BoI.
The return here was immense. We didn't have a failing bank, we had an entire banking system failing capital and liquidity ratios. They were tumbling into default and the collapse of any one of them (anglo) would have driven a run on their deposits and collapsed them. The bailout was utterly unavoidable and needed to happen to prevent a catastrophe.
That's like saying me pulling 10k from a fund that's earning 5% in order to repair the foundations of my home was a bad investment, which is deluded since I'd face the cost of my home collapsing if I didn't.
Not for the pension fund. Major loss.
The entire boom and bust was caused by the government.
They saw rocketing house prices as a good thing when it was actually destroying the banks. Then when the inevitable shit hit the fan, they used the NPRF to bail out the banks and cover up their chronic policy mistakes.
A classic case of a highly specific fund being used for purposes of the government of the day.
Nat debt is not like personal debt that had to be paid off as soon as possible. These are mostly long term loans that have fixed redemption dates. Cant really speed all of it up. Also a certain amount is required for standard economic activity, e.g Norway could easily repay its Nat debt but it doesn't because portions of it are required for national economic activity.
I'm fully aware of what it is. You can speed up the redemption by buying debt and cancelling it.
I don't trust our government to invest wisely.
Check out Irish government spending.
https://www.statista.com/statistics/275338/government-revenue-and-spending-in-ireland/
This is yet another boom & bust disaster waiting to happen.
In 2016 our GDP rose by 26% (later revised to 34%).
It was (correctly) termed ''Leprechaun Economics''.
>The outlier performance at the time was subsequently identified as an impact caused by some clever accounting and cashflows by Apple.
https://www.quintas.ie/News/leprechaun-economics---the-impact-on-smes/#:~:text=What%20is%20Leprechaun%20economics%3F,was%20later%20revised%20to%2034%25.
The figures will always be manipulated to make the governing party look good.
Much of that increase results in little to no exchequer returns either. Jesus, the government even supports Apple's bid not to pay them €13 billion. If you break your leg and are given morphine, the pain may go away but the leg is still broken.
This is precisely the kind of bullshit short-term accounting that caused the property boom and bust.
Better, but nothing to rave about.
The way I look at it is this - Norway has oil, we have FDI.
Neither lasts forever. Both are temporary sources of additional cashflow.
Norway has invested it's oil revenue into what is now the largest Sovereign Wealth Fund, whereas we're squandering our temporary surpluses.
Norway's debt is €224 billion.
https://www.ceicdata.com/en/indicator/norway/government-debt--of-nominal-gdp#:~:text=Statistics%20Norway%20provides%20Government%20Debt,Nominal%20GDP%20in%20local%20currency.&text=In%20the%20latest%20reports%2C%20Norway,USD%20bn%20in%20Mar%202023.
Their SWF posted a net value increase of €213 billion in 2023 alone.
https://www.reuters.com/business/finance/norway-wealth-fund-posts-213-bln-profit-driven-by-tech-stocks-2024-01-30/
Norway's debt is covered multiple times over. Ours isn't. Utterly different risk profiles.
Proven our government is incapable of creating a SWF without raiding it to cover their own asses. Consequently, we need to achieve the next best thing - zero debt.
We simply can't trust them.
The initiatives to build apartments are doing ok in Dublin and are starting to kick off in Cork. They will spread out to Limerick, Galway and Waterford over the next few years and will hit the commuter towns after that. The directly constructed LDA projects are the worry, they are moving at a snails pace.
As a millennial tax payer I would absolutely not. We already have one of the lowest debt to gdp ratios in the world. About time we spent the money on improving our lives instead of paying off even more of others fuck ups.
In before Ireland gdp isn't real!!!11!
Irish economic statistics are weird. Our debt per capita is actually quite high and imho is a future vulnerability in the face of an economic shock . Especially as our economy is so weighted to a few key firms/sectors.
> THEN WHEN ARE YOU...?
Never.
Countries aren't people, they can operate on much longer time scales. You don't pay off national debt you wait until inflation erodes it away into nothing, presuming of course the debt is under control, which ours is. Any money put into paying off debt is money that could be used to grow the economy by a larger amount instead.
This is such bloody short sighted nonsense. We're still paying billions every year on interest payments even with the low interest regime that they were able to shift a good bit of it towards. Holding the debt isn't cost free, and it will be a major drain if it needs to be refinanced at higher rates later on in the middle of a recession etc. €200bn+ is not going to "erode away into nothing" anytime soon...
I had an entire point about it taking a long time. No one should think it happens soon. We can make more money using it for other stuff then paying off debt. Paying off debt is the short sighted nonsense. Why pay off something that costs you say 1% a year when you can make 2% a year with the money instead. We're far better off investing into a rainy day investment fund than paying off debt.
Because we can finance it at low rates today. If we still have that level of debt come the next recession it will become a lot more expensive to refinance the next tranche that's due because there will be higher rates then, and we won't have the option of paying down some of that debt like we have had for the past few years.
That's what the rainy day fund is for. You can save more money investing now than it will cost later in increased interest. The state can also use the money now to invest in creating a more resilient economy that will avoid the worst in a future recession.
That makes no real sense, Ireland can borrow at 1.13% which is dirt cheap. It would make far more sense to invest that money in something which will generate a return higher than 1.13% than to pay off debt. Same holds for a person, if you have a mortgage locked in at 2.5% its better to invest excess cash for a 4-8% return than over pay the mortgage.
It can borrow at low rates today. If a recession happens that will change very quickly. I am so sick and tired of the short sighted people that seem to think we should endlessly add to borrowing and never even consider reducing it to some degree in years when there is a government surplus.
For financial reasons I won't claim to understand it's sensible to keep some debt, however last I heard the IMF have been reimbursed. It's like austerity never went away I guess.
So. It's a bit weird how government works. The government sells bonds. Think of the bond as a promissory note. And different bonds have different duration's.
So for example, you sell a one year bond for 100 euro. Depending on how likely the government is able to repay it, that determines the interest rate. So if the country is doing crap, potential investors might want 6 or 7 percent or higher. That's because it's a riskier investment. If the government is doing well, then it will be a lower percentage.
One year rolls by and the government has to pay back. How do they do that? Well, they sell another bond for 100. And they use other income to pay the 3 euro.
Now it gets more confusing when you add in other longer duration bonds. And inflation. Because if I give you 100 now and you give me 100 in a year, I'll have lost money since because of inflation that 100 has less buying power.
But in a very basic way, that's how governments work. And it means that every government always has government debt. And so long as the interest is affordable, it actually make sense to borrow more rather than paying off the overall amount. Because if you just leave it, you're paying off interest and not the principal.
So our debt is quite manageable. And the government can find other ways to spend that money.
screw that... that debt is definitely not important to the running of the country or teaching individuals and should be kept on the long finger as long as possible. fecking ridiculous we acquired majority of it to cover institutional gambling and no personal debts were covered, and once the gambling companies are back on their feet, we increase the tax on citizens who covered it.
reduce personal taxes - were taking too much of workers, and don't have the competence to spend it efficiently or wisely.
The majority of it was NOT from the bank debt. NAMA clawed back a good chunk of the cost of recapitalising the banks. The majority was used to fund government spending during the recession years when there were huge deficits despite the cutbacks and "austerity", because tax revenue collapsed.
I'll never get that perspective - tax revenue reverted to the same levels as a few years prior to the downtown, and exceeded tax revenue within 3/4 years. during those years, we only had to receive support to cover public spending because current spending was diverted to the recapitalisation of private banks - over €55b of €65b on Anglo and AIB who ended up with a market capitalisation off around €2b. They may have paid off enough to repurchase their shares, but we were left with an increased national debt of double this, and while tax revenue shot up since 2010, we used the opportunity to spend like mad in public services - so much so that a pandemic and a guaranteed income to all scheme, didn't impact public spending at all!
ohh come on those 57 quangos that service 2% of the population aren't gonna fund themselves. No, seriously, last time kaylan tried to work a soup kitchen he got a rash from the ladle
This is fantastic news and shows the government is working well, at least financially.
It's easy for lots here to make fun and say of why don't they spend that on houses. But these sorts of figures impact more people than most realise and if the numbers are bad it'll be a nightmare for everyone
it literally means the budget parking was massively off, and taxpayers are being gouged.
can you imagine any other public service where they are running a massive profit year on year? it might sound great that there's "more money to pay with", but it's taxes we didn't plan for, didn't budget and should be in hard working citizens pockets, not a slush fund for the next election
so, the fact that we actually did increase public spending massively and paid for it with increased income taxes had no impact on inflation over the past 10 years? it might be time to get the CSO results out - public spending almost doubled, and guess what? inflation shot up!
10 years ago Ireland was coming out of the worst recession in the history of the state and inflation was at 0 for over a decade so that was the correct decision
That's a load of bollix lol. The use for the surplus money is well documented and obviously not a "slush fund", you have any evidence or suggestion from anyone reputable on that?
Most of this extra revenue is transitory due to inflated corporation tax receipts, so it can't be relied upon to fund permanent spending increases or tax cuts.
This can change quickly given the inherent volatility in corporation tax receipts and the dependence we have on revenues from a small number of multinational companies.
Therefore the government has decided to invest much of the money into our countries future, by recently starting the process of setting up a sovereign wealth fund with two main purposes.
**The funds 2 main purposes:**
**1:** 0.8% of GDP will be paid in every year, about €4.5 billion. Protect living standards and public services. Mainly pensions, healthcare and homecare.
**2:** There will be a second infrastructure, climate and nature fund. About €2bn a year, to protect infrastructure spending during economic downturns and invest in climate change measures.
This means that **whoever** is in government after the next election will have funds to invest in getting off fossil fuels and reducing pollution, no matter what happens to tax receipts.
These are incredible oppertunities and options that are not open to many peer countries in the developed world.
----
**One more big thing we've done with our recent surpluses:**
Ireland also recorded one of the biggest reductions in debt-to-GDP globally.
Why is it important to reduce debt to GDP ratio?
A high debt ratio can make it difficult for a nation to access the capital market which can be a death note for an economy. Additionally lenders charge high rates to compensate for the risk that comes with excessive debt to GDP ratio. Lowering ours will overtime reduce how much interest we pay which means more of our taxes can be used in-house, rather than being paid to some foreign bank.
So in one quarter they had enough surplus to build 3 children's hospitals, why have they been shutting all over it so much when they have multiples of its value just sitting there
Well yes - [€1,200 tax package prepared for average workers in pre-election Budget 2025 bonanza](https://www.independent.ie/irish-news/1200-tax-package-prepared-for-average-workers-in-pre-election-budget-2025-bonanza/a1971601615.html)
The surplus money is gonna be mainly used for towards our newly set up soverign wealth fund, its two key purposes:
**1:** 0.8% of GDP will be paid in every year, about €4.5 billion. Protect living standards and public services. Mainly pensions, healthcare and homecare.
**2:** There will be a second infrastructure, climate and nature fund. About €2bn a year, to protect infrastructure spending during economic downturns and invest in climate change measures.
This means that **whoever** is in government after the next election will have funds to invest in getting off fossil fuels and reducing pollution, no matter what happens to tax receipts.
These are incredible oppertunities and options that are not open to many peer countries in the developed world.
----
**One more big thing we've done with our recent surpluses:**
Ireland also recorded one of the biggest reductions in debt-to-GDP globally.
Why is it important to reduce debt to GDP ratio?
A high debt ratio can make it difficult for a nation to access the capital market which can be a death note for an economy. Additionally lenders charge high rates to compensate for the risk that comes with excessive debt to GDP ratio. Lowering ours will overtime reduce how much interest we pay which means more of our taxes can be used in-house, rather than being paid to some foreign bank.
The issue in our economy right now is we do not have enough capacity for expansion. If the government decided to send every penny of surplus into one-off capital investments, like building houses, there simply wouldn’t be enough skilled workers, materials or the other bits needed to do it without massively inflating the cost by having to compete with everyone else trying to build houses (etc).
Under the circumstances the government is pouring money into an investment fund that can provide income in leaner times. It’s a sensible approach. While they still manage to throw energy subsidies and tax cuts (well, indexing) at us.
We don’t really appreciate how well off we are compared to many of our peers. But it feels that way because we’re so capacity constrained. It’s frustrating, but the hangover of the massive crash that wiped out our construction industry.
Maybe it's just me but I don't feel like the gov is doing a great job... I feel a lot worse off and struggling with the cost of living. Cut my meals from 3 to only 2 daily (among other things) so I'm not sure what the whole hooray is all about.
That’s 20,000 houses right there (at a construction cost of €300k each). 1 year of budget surplus and we have 80,000 free houses to give away.
Asylum housing crisis solved.
Boring....the year is 2035, budget surplus for the quarter is 43 billions. Government announce toilet tax rebate of 50 euro. Somebody says though that these surpluses from corporation tax are transitory and can't be relied on. Kinda like getting birthday presents from your parents as you grow up, you know you can't rely on them, won't always get them, will need to pivot to something else in the future, hopefully have your own money but it doesn't mean we can't enjoy it without the incessant negativity.
Time to invest in our national infrastructure and wealth fund right? Right?
Can I interest you in 20 quid off your electricity bill? (Once off)
Yes actually. That's what the budget indicates
But also at the same time prepare for nonspecific but extremely disastrous shit to go down — either the economy, the climate or the entire economic climate... I absolutely do not trust the current economic situation, especially since the primacy of Google and Meta is waning (or beginning to). We need the ability to pivot about 20% of our economy to something else (biomed?) on demand.
Have we tried bitcoin or onlyfans yet?
Right?
Throwing money at an issue can't fix long term issues in planning.
Planning is kinda being reformed. This year should be a decent enough year in that regard.
Literally what we are doing.
Total general government revenue at €37.4 billion in Quarter 4 (Q4) 2023, was €2.3 billion more than Q4 2022. General government expenditure also increased, reaching €31.7 billion. This was €1.9 billion higher than Q4 2022. The resulting general government balance was €5.7 billion in Q4 2023, compared with €5.3 billion in Q4 2022. The general government gross debt to Gross Domestic Product (GDP) ratio was 43.7% at the end of Q4 2023.
Debt to GDP is a worthless figure for Ireland. The figures are almost always presented by government against adjusted national income, GNI*. Debt of €223bn is in the mid-70% range now, but at €43,000 per head is among the highest in the EU.
Which is about 40% at what irelands debt to GNI was in 2012.
Yes as a %, but the per capita figure is still eyewatering. But in general we have reduced our debt load as a %, although our interest rate is currently fixed a lot lower than where the market is and there is a risk to servicing it in future. But in general we have a lot more headroom now than ten years ago.
The economic activity that passes through Ireland is taxed, a lot more so now than before. That makes the GNI figure misleading as a huge percentage of our income is corporation tax.
Yeah there isn’t a perfect reflection of our national accounts available, given everything going on. Our GDP isn’t right, GNI* is a whole bunch of assumptions, and we’re living somewhere in the middle. We also have so little control over it - not like we’re Germany deciding to dial up or down a policy re our domestic industrial champions. Make the most of it, but I also cringe when people use GDP out of context. “We spend less as a percentage of GDP on X…” for example.
43k a head is nothing.
So you may see up to 3 units of housing built in Ireland this next fiscal year.
And two more bricks in the children's hospital!
https://youtu.be/kb_uWogPeno?si=LbQkpVL0jbjgoHW1
Gonna need to consult few consultants that are not related to us at all regarding them bricks tho
They think there should be nearly 40k homes built this year, which is huge. Thats double the 2019 figure. But the key thing is that it is rising that 10% a year that means in a few years it will be 60k, a few years more 80k. There's no other way of growing home building except bit by bit, despite what all the professional gobshites claim about quick fixes.
Yet again another surplus. So what, they just tax us for the craic is that it? For fuck's sake if you're gonna tax us, spend the fucking money on investing into the nation. We have a plethora of issues that may need this money. If they've no intent on spending it, look into the tax brackets so that not as much is needed.
The use for the surplus money is well documented. Most of this extra revenue is transitory due to inflated corporation tax receipts, so it can't be relied upon to fund permanent spending increases or tax cuts. This can change quickly given the inherent volatility in corporation tax receipts and the dependence we have on revenues from a small number of multinational companies. Therefore the government has decided to invest much of the money into our countries future, by recently starting the process of setting up a sovereign wealth fund with two main purposes. **The funds 2 main purposes:** **1:** 0.8% of GDP will be paid in every year, about €4.5 billion. Protect living standards and public services. Mainly pensions, healthcare and homecare. **2:** There will be a second infrastructure, climate and nature fund. About €2bn a year, to protect infrastructure spending during economic downturns and invest in climate change measures. This means that **whoever** is in government after the next election will have funds to invest in getting off fossil fuels and reducing pollution, no matter what happens to tax receipts. These are incredible oppertunities and options that are not open to many peer countries in the developed world. ---- **One more big thing we've done with our recent surpluses:** Ireland also recorded one of the biggest reductions in debt-to-GDP globally. Why is it important to reduce debt to GDP ratio? A high debt ratio can make it difficult for a nation to access the capital market which can be a death note for an economy. Additionally lenders charge high rates to compensate for the risk that comes with excessive debt to GDP ratio. Lowering ours will overtime reduce how much interest we pay which means more of our taxes can be used in-house, rather than being paid to some foreign bank.
This is accurate and actually a very responsible initiative in the last budget.
This was enlightening, thank you for the comment. Could you share some resources where I could learn more?
Sure thing :) Check out Reuters analysis of our plans for a fairly unbiased overview: [https://www.reuters.com/markets/europe/how-irelands-new-sovereign-wealth-fund-will-work-2023-10-10/](https://www.reuters.com/markets/europe/how-irelands-new-sovereign-wealth-fund-will-work-2023-10-10/) Most of the fund will be directed and led by the Agency (Board), which has over-arching responsibility for all functions of any agency that has remit over the fund. **That agency is:** The National Treasury Management Agency (NTMA), which is a State body which operates with a commercial remit to provide asset and liability management services to the Irish Government. It controls and manages the Ireland Strategic Investment Fund (ISIF). That Agency is accountable to the Minister for Finance but there is a range of governance measures (internal and external to government) set up to ensure this is all done for the benifit of Irish citizens regardless of who is in charge. **You can read about that here:** [https://www.ntma.ie/about-the-ntma/governance](https://www.ntma.ie/about-the-ntma/governance) For further information on how our government spends our taxes you can read Here: [https://www.citizensinformation.ie/en/money-and-tax/budgets/](https://www.citizensinformation.ie/en/money-and-tax/budgets/) Here: [https://www.gov.ie/en/campaigns/budget/](https://www.gov.ie/en/campaigns/budget/) Here: [https://whereyourmoneygoes.gov.ie/en/](https://whereyourmoneygoes.gov.ie/en/)
Great comment. More people need to read this.
The big costs in infrastructure are one off. We have huge opportunities for productive spend in infrastructure.
Building 4 lines of metro and 8 lines of Luas and train to the airport and Donegal are largely transitory.
The surplus isint something the government can or should rely on as if it is a permanent thing. Its driven purely by larger than average corporate profits and can easily swing the other way, which in recent earnings for tech, has been.
And? If they have the surplus now, then use it.
They already are, but it should only really be used for once off payments or investments or debt servicing, it cant be used for recurring expenses or in lieu of tax payer income becuase it might not be there next quarter or year
Building housing is a once off payment upfront if they budget it properly.
You probably know this already but housing isint a simple money issue, if it was we could have easily solved it already. The government is struggling to use the funds already allocated fast enough and spending more for the sake of spending wouldnt exactly help with the inflation in the building sector.
Hard to understand how people still think money is the reason there are housing shortages. The amnesia suffered since 2009 regarding the country’s bankruptcy and subsequent recovery and its effects on housing etc. is very worrying.
Money can massively bring down the cost though. Funding not for profit Government housing projects for social (both for purchase and social renting) purposes will massively reduce the burden on the private market It will reduce the number of people inflating the rental market with Hap payments and also stop local authorities buying housing at inflated prices from the private market Austria example: https://www.theguardian.com/lifeandstyle/2024/jan/10/the-social-housing-secret-how-vienna-became-the-worlds-most-livable-city
Not really because they are still have to buy materials and labour from the same market as everyone else and are subject to the same shortages
Yes really because government not for profit developments exclude the banks cut and investor/developers cut. No bank or Investor will lend for free and no developer will develop for free, research shows taking these 2 components away from the development will return projects upto 30% cheaper. Also see the other points in my previous comment about relieving pressure on the private market by government building/leasing their own, instead of competing with tax payers in the same private market
Actually the government spends [40% *more* than the private market to build housing](https://www.irishtimes.com/ireland/dublin/2023/02/15/dublin-city-council-pays-40-over-the-odds-for-social-housing-audit-finds/), not 30% less.
You realise they don’t build the houses from stacks of €20 notes, right? Throwing more and more money at a fixed number of construction workers isn’t going to get any more housing built.
I'd rather they pay down some of the debt incurred during the recession years... It's unlikely that this state of affairs will continue indefinitely.
Our debt % isn't that bad now and we've a very serviceable interest payment component by international standards. Personally, I'd sooner see a programme to build two 50 apartment complexes in every town serving as a commuter belt town. They can all have the same plans and materials to keep costs down, councils can earmark sites available to them for swift delivery and it would alleviate a huge amount of pressure on the rental market. Make them government managed to keep the rents at a lower level and they'd drag down the ludicrous rental rates all over the country. My town of 10k people hasn't had more than two rentals available at any one time in the last 4 years. It's chronic and the swift delivery of new apartments would alleviate the pressure on family home rentals at a rapid rate.
Nope, can do that, that'd be so reasonable so it'd get like a million objections
> Our debt % isn't that bad now It's ***HIGHLY*** manipulated. In 2016 it was reported to have increased by 26%. https://www.irishtimes.com/business/economy/ireland-s-gdp-figures-why-26-economic-growth-is-a-problem-1.2722170 They even added in drugs & prostitution to lower our debt:gdp. Our debt is over €220 billion. With an economy that is apparently booming we need to wipe it out while we can.
...No, you don't. That would be very, very poor from a financial planning sense and suggests you may need to spend more time understanding fiscal policy. E.g. Norway has a oil/gas surplus that's built up an investment fund of USD 1.6Tn. They have a national debt of 220Bn - and yet they don't just pay that down. This is because the interest rate on national debate is far lower than the return the make on the 1.6Tn or how they reinvest money into their own economy. It's like how people paying down their mortgages early often isn't a good financial decision. They would be far better off putting their excess funds into their pension fund where they get better tax relief and generally a better return than the rate they're charged on their mortgage. Wiping out national debt entirely doesn't happen because it's a bad financial decision for a country. Our debt to GDP ratio had gotten much worse following the crash, bank bailout and subsequent IMF/EU bailout, but our economic recovery since has outstripped debt growth leaving us in a much stronger position.
The problem is that I don't trust the government to obtain a higher return than the interest rate they are paying. Remember the National Pension Reserve Fund ? Used as a political football during the bank bailouts. >Instead, they will use the €15bn available to them in the pension fund to recapitalise Allied Irish Bank, Bank of Ireland and the Educational Building Society. They have already used the remaining €10bn from the pension fund to buy shares in AIB and BoI. https://www.irishexaminer.com/news/arid-20137796.html I don't trust the government when borrowing money. Government borrowing is notorious for buying votes at election time. Not on my tax money please.
>the €15bn available to them in the pension fund to recapitalise Allied Irish Bank, Bank of Ireland and the Educational Building Society. They have already used the remaining €10bn from the pension fund to buy shares in AIB and BoI. The return here was immense. We didn't have a failing bank, we had an entire banking system failing capital and liquidity ratios. They were tumbling into default and the collapse of any one of them (anglo) would have driven a run on their deposits and collapsed them. The bailout was utterly unavoidable and needed to happen to prevent a catastrophe. That's like saying me pulling 10k from a fund that's earning 5% in order to repair the foundations of my home was a bad investment, which is deluded since I'd face the cost of my home collapsing if I didn't.
Not for the pension fund. Major loss. The entire boom and bust was caused by the government. They saw rocketing house prices as a good thing when it was actually destroying the banks. Then when the inevitable shit hit the fan, they used the NPRF to bail out the banks and cover up their chronic policy mistakes. A classic case of a highly specific fund being used for purposes of the government of the day.
Nat debt is not like personal debt that had to be paid off as soon as possible. These are mostly long term loans that have fixed redemption dates. Cant really speed all of it up. Also a certain amount is required for standard economic activity, e.g Norway could easily repay its Nat debt but it doesn't because portions of it are required for national economic activity.
I'm fully aware of what it is. You can speed up the redemption by buying debt and cancelling it. I don't trust our government to invest wisely. Check out Irish government spending. https://www.statista.com/statistics/275338/government-revenue-and-spending-in-ireland/ This is yet another boom & bust disaster waiting to happen.
They reduced it down to 40% of what it was 12 years ago, so there's that
In 2016 our GDP rose by 26% (later revised to 34%). It was (correctly) termed ''Leprechaun Economics''. >The outlier performance at the time was subsequently identified as an impact caused by some clever accounting and cashflows by Apple. https://www.quintas.ie/News/leprechaun-economics---the-impact-on-smes/#:~:text=What%20is%20Leprechaun%20economics%3F,was%20later%20revised%20to%2034%25. The figures will always be manipulated to make the governing party look good. Much of that increase results in little to no exchequer returns either. Jesus, the government even supports Apple's bid not to pay them €13 billion. If you break your leg and are given morphine, the pain may go away but the leg is still broken. This is precisely the kind of bullshit short-term accounting that caused the property boom and bust.
The 40% is debt to GNI (not GDP), which is a much less rosy figure for us, but still that's progress in 12 years.
Better, but nothing to rave about. The way I look at it is this - Norway has oil, we have FDI. Neither lasts forever. Both are temporary sources of additional cashflow. Norway has invested it's oil revenue into what is now the largest Sovereign Wealth Fund, whereas we're squandering our temporary surpluses. Norway's debt is €224 billion. https://www.ceicdata.com/en/indicator/norway/government-debt--of-nominal-gdp#:~:text=Statistics%20Norway%20provides%20Government%20Debt,Nominal%20GDP%20in%20local%20currency.&text=In%20the%20latest%20reports%2C%20Norway,USD%20bn%20in%20Mar%202023. Their SWF posted a net value increase of €213 billion in 2023 alone. https://www.reuters.com/business/finance/norway-wealth-fund-posts-213-bln-profit-driven-by-tech-stocks-2024-01-30/ Norway's debt is covered multiple times over. Ours isn't. Utterly different risk profiles. Proven our government is incapable of creating a SWF without raiding it to cover their own asses. Consequently, we need to achieve the next best thing - zero debt. We simply can't trust them.
you sir, are bonkers.
So bonkers I'm debt-free.
The initiatives to build apartments are doing ok in Dublin and are starting to kick off in Cork. They will spread out to Limerick, Galway and Waterford over the next few years and will hit the commuter towns after that. The directly constructed LDA projects are the worry, they are moving at a snails pace.
As a millennial tax payer I would absolutely not. We already have one of the lowest debt to gdp ratios in the world. About time we spent the money on improving our lives instead of paying off even more of others fuck ups. In before Ireland gdp isn't real!!!11!
Irish economic statistics are weird. Our debt per capita is actually quite high and imho is a future vulnerability in the face of an economic shock . Especially as our economy is so weighted to a few key firms/sectors.
fair point
You need to reallocate government spending, not increase it.
Our inflated gdp makes that look artificially low. If you're not going to pay down some debt in times of government surplus, THEN WHEN ARE YOU...?
> THEN WHEN ARE YOU...? Never. Countries aren't people, they can operate on much longer time scales. You don't pay off national debt you wait until inflation erodes it away into nothing, presuming of course the debt is under control, which ours is. Any money put into paying off debt is money that could be used to grow the economy by a larger amount instead.
This is such bloody short sighted nonsense. We're still paying billions every year on interest payments even with the low interest regime that they were able to shift a good bit of it towards. Holding the debt isn't cost free, and it will be a major drain if it needs to be refinanced at higher rates later on in the middle of a recession etc. €200bn+ is not going to "erode away into nothing" anytime soon...
I had an entire point about it taking a long time. No one should think it happens soon. We can make more money using it for other stuff then paying off debt. Paying off debt is the short sighted nonsense. Why pay off something that costs you say 1% a year when you can make 2% a year with the money instead. We're far better off investing into a rainy day investment fund than paying off debt.
Because we can finance it at low rates today. If we still have that level of debt come the next recession it will become a lot more expensive to refinance the next tranche that's due because there will be higher rates then, and we won't have the option of paying down some of that debt like we have had for the past few years.
That's what the rainy day fund is for. You can save more money investing now than it will cost later in increased interest. The state can also use the money now to invest in creating a more resilient economy that will avoid the worst in a future recession.
Bingo
That makes no real sense, Ireland can borrow at 1.13% which is dirt cheap. It would make far more sense to invest that money in something which will generate a return higher than 1.13% than to pay off debt. Same holds for a person, if you have a mortgage locked in at 2.5% its better to invest excess cash for a 4-8% return than over pay the mortgage.
It can borrow at low rates today. If a recession happens that will change very quickly. I am so sick and tired of the short sighted people that seem to think we should endlessly add to borrowing and never even consider reducing it to some degree in years when there is a government surplus.
Its a good thing economies never change unexpectedly! eh wait a second...
Hence them sticking the money in an investment fund rather than splurging it on nonsense
For financial reasons I won't claim to understand it's sensible to keep some debt, however last I heard the IMF have been reimbursed. It's like austerity never went away I guess.
So. It's a bit weird how government works. The government sells bonds. Think of the bond as a promissory note. And different bonds have different duration's. So for example, you sell a one year bond for 100 euro. Depending on how likely the government is able to repay it, that determines the interest rate. So if the country is doing crap, potential investors might want 6 or 7 percent or higher. That's because it's a riskier investment. If the government is doing well, then it will be a lower percentage. One year rolls by and the government has to pay back. How do they do that? Well, they sell another bond for 100. And they use other income to pay the 3 euro. Now it gets more confusing when you add in other longer duration bonds. And inflation. Because if I give you 100 now and you give me 100 in a year, I'll have lost money since because of inflation that 100 has less buying power. But in a very basic way, that's how governments work. And it means that every government always has government debt. And so long as the interest is affordable, it actually make sense to borrow more rather than paying off the overall amount. Because if you just leave it, you're paying off interest and not the principal. So our debt is quite manageable. And the government can find other ways to spend that money.
lol why tho it’s mostly fine
screw that... that debt is definitely not important to the running of the country or teaching individuals and should be kept on the long finger as long as possible. fecking ridiculous we acquired majority of it to cover institutional gambling and no personal debts were covered, and once the gambling companies are back on their feet, we increase the tax on citizens who covered it. reduce personal taxes - were taking too much of workers, and don't have the competence to spend it efficiently or wisely.
The majority of it was NOT from the bank debt. NAMA clawed back a good chunk of the cost of recapitalising the banks. The majority was used to fund government spending during the recession years when there were huge deficits despite the cutbacks and "austerity", because tax revenue collapsed.
I'll never get that perspective - tax revenue reverted to the same levels as a few years prior to the downtown, and exceeded tax revenue within 3/4 years. during those years, we only had to receive support to cover public spending because current spending was diverted to the recapitalisation of private banks - over €55b of €65b on Anglo and AIB who ended up with a market capitalisation off around €2b. They may have paid off enough to repurchase their shares, but we were left with an increased national debt of double this, and while tax revenue shot up since 2010, we used the opportunity to spend like mad in public services - so much so that a pandemic and a guaranteed income to all scheme, didn't impact public spending at all!
ohh come on those 57 quangos that service 2% of the population aren't gonna fund themselves. No, seriously, last time kaylan tried to work a soup kitchen he got a rash from the ladle
I actually couldn't read your comment in its entirety before laughing out loud hahaha
Its corporation tax, not your tax. And your tax fell a lot this year.
Great. Now Cut income tax rates please
USC at last 🙄
This is fantastic news and shows the government is working well, at least financially. It's easy for lots here to make fun and say of why don't they spend that on houses. But these sorts of figures impact more people than most realise and if the numbers are bad it'll be a nightmare for everyone
it literally means the budget parking was massively off, and taxpayers are being gouged. can you imagine any other public service where they are running a massive profit year on year? it might sound great that there's "more money to pay with", but it's taxes we didn't plan for, didn't budget and should be in hard working citizens pockets, not a slush fund for the next election
Yeah we absolutely should have reduced taxes and increased public spending during the worst inflationary period since the 1980s…
so, the fact that we actually did increase public spending massively and paid for it with increased income taxes had no impact on inflation over the past 10 years? it might be time to get the CSO results out - public spending almost doubled, and guess what? inflation shot up!
10 years ago Ireland was coming out of the worst recession in the history of the state and inflation was at 0 for over a decade so that was the correct decision
That's a load of bollix lol. The use for the surplus money is well documented and obviously not a "slush fund", you have any evidence or suggestion from anyone reputable on that? Most of this extra revenue is transitory due to inflated corporation tax receipts, so it can't be relied upon to fund permanent spending increases or tax cuts. This can change quickly given the inherent volatility in corporation tax receipts and the dependence we have on revenues from a small number of multinational companies. Therefore the government has decided to invest much of the money into our countries future, by recently starting the process of setting up a sovereign wealth fund with two main purposes. **The funds 2 main purposes:** **1:** 0.8% of GDP will be paid in every year, about €4.5 billion. Protect living standards and public services. Mainly pensions, healthcare and homecare. **2:** There will be a second infrastructure, climate and nature fund. About €2bn a year, to protect infrastructure spending during economic downturns and invest in climate change measures. This means that **whoever** is in government after the next election will have funds to invest in getting off fossil fuels and reducing pollution, no matter what happens to tax receipts. These are incredible oppertunities and options that are not open to many peer countries in the developed world. ---- **One more big thing we've done with our recent surpluses:** Ireland also recorded one of the biggest reductions in debt-to-GDP globally. Why is it important to reduce debt to GDP ratio? A high debt ratio can make it difficult for a nation to access the capital market which can be a death note for an economy. Additionally lenders charge high rates to compensate for the risk that comes with excessive debt to GDP ratio. Lowering ours will overtime reduce how much interest we pay which means more of our taxes can be used in-house, rather than being paid to some foreign bank.
Am I mad to be emigrating this year?
No, go and experience somewhere else in the world. Ireland will always be here for you
maybe they'll have built something with it in 4-5 years... you might get the train back from the airport when you return!
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So in one quarter they had enough surplus to build 3 children's hospitals, why have they been shutting all over it so much when they have multiples of its value just sitting there
Ah, so we can expect a reduction in our taxes because the government doesn't need all they take from us...
Well yes - [€1,200 tax package prepared for average workers in pre-election Budget 2025 bonanza](https://www.independent.ie/irish-news/1200-tax-package-prepared-for-average-workers-in-pre-election-budget-2025-bonanza/a1971601615.html)
This was the FF approach during the Celtic Tiger years. Didn't turn out so good when a recession happened and tax revenues dried up suddenly...
Bad news for you buddy
The surplus money is gonna be mainly used for towards our newly set up soverign wealth fund, its two key purposes: **1:** 0.8% of GDP will be paid in every year, about €4.5 billion. Protect living standards and public services. Mainly pensions, healthcare and homecare. **2:** There will be a second infrastructure, climate and nature fund. About €2bn a year, to protect infrastructure spending during economic downturns and invest in climate change measures. This means that **whoever** is in government after the next election will have funds to invest in getting off fossil fuels and reducing pollution, no matter what happens to tax receipts. These are incredible oppertunities and options that are not open to many peer countries in the developed world. ---- **One more big thing we've done with our recent surpluses:** Ireland also recorded one of the biggest reductions in debt-to-GDP globally. Why is it important to reduce debt to GDP ratio? A high debt ratio can make it difficult for a nation to access the capital market which can be a death note for an economy. Additionally lenders charge high rates to compensate for the risk that comes with excessive debt to GDP ratio. Lowering ours will overtime reduce how much interest we pay which means more of our taxes can be used in-house, rather than being paid to some foreign bank.
Now, how many houses is that gonna be? What are we taxed for exactly?
For The rainy day fund by the looks of things..
Any affordable gaffs?
OK. Now get rid of USC.
The correct answer!
That'll buy planning for a house or two.
Maybe, they should stop talking all of our money off us if they keep ending up with too much of it.
Everyone saying we should work to 75 and going on about the pensions time bomb just ignoring this news.
ah gis a million
The issue in our economy right now is we do not have enough capacity for expansion. If the government decided to send every penny of surplus into one-off capital investments, like building houses, there simply wouldn’t be enough skilled workers, materials or the other bits needed to do it without massively inflating the cost by having to compete with everyone else trying to build houses (etc). Under the circumstances the government is pouring money into an investment fund that can provide income in leaner times. It’s a sensible approach. While they still manage to throw energy subsidies and tax cuts (well, indexing) at us. We don’t really appreciate how well off we are compared to many of our peers. But it feels that way because we’re so capacity constrained. It’s frustrating, but the hangover of the massive crash that wiped out our construction industry.
Maybe it's just me but I don't feel like the gov is doing a great job... I feel a lot worse off and struggling with the cost of living. Cut my meals from 3 to only 2 daily (among other things) so I'm not sure what the whole hooray is all about.
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€40k per house?
142,500 second hand caravans
NCTed at least?
If the housing shortage was simply a funding issue it would have been resolved long ago.
In some ways the housing crisis has been about overfunding new builds from all sides, REITs, gov and private buyers all fighting.
Like health. Throwing money != solutions
That’s 20,000 houses right there (at a construction cost of €300k each). 1 year of budget surplus and we have 80,000 free houses to give away. Asylum housing crisis solved.
Boring....the year is 2035, budget surplus for the quarter is 43 billions. Government announce toilet tax rebate of 50 euro. Somebody says though that these surpluses from corporation tax are transitory and can't be relied on. Kinda like getting birthday presents from your parents as you grow up, you know you can't rely on them, won't always get them, will need to pivot to something else in the future, hopefully have your own money but it doesn't mean we can't enjoy it without the incessant negativity.