SPENDING PLAN:THE GOVERNMENT had budgeted for almost no increase in spending next year, before any measures announced on budget day are taken into account.
The Estimates of Receipts and Expenditure for 2009 published today allows for the day-to-day costs of running the Government, including wages, to rise by some 2.5 per cent to just under €42 billion. Capital expenditure, however, will fall by 6.3 per cent to €7.65 billion.
Overall Government spending will increase by less than €300 million to €49.75 billion before budget day announcements. But even with such a small increase in spending, the exchequer will be facing a deficit of €14.8 billion at the end of 2009.
The pre-budget White Paper also shows the Government is not expecting any significant improvement in tax revenues between now and the end of the year, or between this year and next.
Tax revenues for this year are expected to be €42.3 billion, but this figure will only be hit if there is no further deterioration and with a contribution of almost €4 billion in corporation tax, much of which is due in November.
Next year the Government predicts that tax revenues will hit €41.2 billion, assuming no tax increases are announced in next Tuesday's budget.
The biggest cuts in the capital budget have come in the areas of transport and agriculture. No details were released, but the cutting of some €168.5 million from the Department of Transport capital budget indicates a number of large projects will be shelved or delayed.
The capital budget for the Department of Agriculture has been cut by some €200 million, but this is understood to reflect the fact that this year's budget came in some €200 million over target due mainly to expenditure on the farm waste management scheme.
The Office of Public Works capital budget is reduced by €82.5 million in response to the suspension of the decentralisation scheme for the civil and public service.
The Arts, Sport and Tourism capital budget is down some €126 million, but sources said that a number of large one-off payments - including a contribution towards the redevelopment of Lansdowne Road stadium - will not be repeated.
Capital spending by the Health Service Executive is to be reduced by €124 million.
Savings in current spending have been achieved this year and are planned for next year, according to the figures.
But despite having made significant cuts in current spending since halfway through the year, the Government still expects that it will exceed its target for 2008 by some €540 million, or 1.3 per cent.
A certain amount of nip and tuck has taken place, not least the Department of the Taoiseach which looks like coming in at €38.4 billion, some €7 million under its budget day target.
Numerous other departments achieved savings of this magnitude. But they were dwarfed by a €360 million overspend this year at the Department of Social Welfare, much of it attributed to the increased numbers drawing unemployment assistance.
The other big overspend was in the Health Service Executive, which broke budget by some €400 million, much of it due to the UK holding back on payment for UK social welfare contributors receiving healthcare in Ireland.
Cuts have been made in the current budgets of some 27 of the 41 line departments and other establishments. However, Education, the big spending department, and the Health Service Executive received increases of 2.7 per cent and 1.4 per cent respectively.
