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Fiscal Council: Budget 2016 spending raises "questions about the entire budgetary process"

John McHale, chairman of the Irish Fiscal Advisory Council has stood over his criticisms of Budge...
Newstalk
Newstalk

09.24 15 Oct 2015


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Fiscal Council: Budget 2016 sp...

Fiscal Council: Budget 2016 spending raises "questions about the entire budgetary process"

Newstalk
Newstalk

09.24 15 Oct 2015


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John McHale, chairman of the Irish Fiscal Advisory Council has stood over his criticisms of Budget 2016 - and said that he, and his colleagues were not informed about communications between the Department of Finance and the European Commission.

Speaking to Newstalk Breakfast, he described this year's supplementary budget as "not normal," saying that the spending outlined is "off the charts" when compared to other years - and that the Fiscal Council had not been made aware of these additional spending plans.

A statement from the Department of Finance before the Budget said that supplementary estimates are a regular feature, and that what is different this year is that the government is accounting for them before the budget rather than passing them through the Oireachtas later in the year.

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The chairman criticised the pro-cyclical nature of Budget 2016 in an interview on RTE's Morning Ireland, and was forced to withdraw comments stating that the Budget may have broken EU spending rules.

After being contacted by the Department of Finance who clarified the situation, he said that the fact that he had not been given that information before that point "raises issues."

He added that he hopes that this technical point will not distract people from his broader concerns regarding the level of Government spending outlined for 2016.

"The main point that I was making on behalf of the council is that the increase in spending for this year - beyond what was budgeted, the €1.7bn, leads to an overly expansionary fiscal stance."

He said that the degree of spending outlined by the Government raises "questions about the entire budgetary process."

Regarding the extra spending outlined in the supplementary budget he said that the high level is worrying - and that the Fiscal Council was not aware of these spending plans when it prepared its pre-budget statement.

Mr McHale added that he was disappointed that his clarification yesterday has been labelled a "humiliation and a reversal."

When asked if he thought that there were attempts to spin the story to damage his credibility he said, "I certainly don't know what the department of finance might have said to the media - but I don't think so."

The chairman maintained that the independence of the Fiscal Council from political interests has not been violated.


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