Ireland won't actually face a €280m 'leprechaun economics' EU payout

The EU's numbers are set to be based on a more accurate economic metric...

Fears of Ireland's extraordinary 2015 official growth rate of 26% resulting in a major additional contribution to the EU may have been based on incorrect information.

In the wake of the publication of the figures, Finance Minister Michael Noonan said that the growth figures could result in Ireland being required to pay an extra €380m to the EU and that technical issues would be likely to reduce this bill to €280m.

However, Dublin Fine Gael MEP Brian Hayes said that this is not the case.

The politician told The Irish Independent that he has received confirmation from EU Budget Commissioner, Kristalina Georgieva that Ireland's contribution will be based on its Gross National Income (GNI) - not the GDP figures. This number excludes the money generated by multinationals which is ultimately sent abroad.

"The speculation over the summer that we would see an increase in our EU budget contribution by €280m next year, due to the once-off spike in our GDP growth rate for 2015 of 26%, is now discredited," he declared.

"The final decision on our GNI figure will be communicated in October and there will be no negotiation after that," Mr Hayes continued.

Ireland's GDP growth figures are inflated by aircraft purchases, corporate restructuring, and companies moving assets (particularly patents) to Ireland from other territories. Assets have come into Ireland through so-called capital inversion deals - and one aircraft leasing company redomiciled its multibillion-euro balance sheet to the State.

Nobel Prize-winning economist Paul Krugman coined the phrase 'Leprechaun economics' in July to refer to the phenomenon.