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The €7.5bn adjustment

  • 18-10-2010 3:27pm
    #1
    noodler
    Registered Users, Registered Users 2 Posts: 26,726 ✭✭✭✭


    Does anyone know how this was broken down?

    In the Stability Programme Update http://www.budget.gov.ie/Budgets/2010/Documents/Final%20SPU.pdf

    p18

    They have €3bn outlined for 2011 and 2012 (although €2bn of this is already from the capital budget).

    Anyone know how the other €1.5bn is broken down with regards timeframe?


Comments

  • #2
    Économiste Monétaire
    Closed Accounts Posts: 2,208 ✭✭✭Économiste Monétaire


    I assume this will be contained in the the Celtic Tiger 2.0 four year budget plan (with a complementary Biffo action figure). Table ten in that document shows current budget adjustments of €1.5bn and €1bn for 2013 and 2014, respectively.


  • #3
    noodler
    Registered Users, Registered Users 2 Posts: 26,726 ✭✭✭✭noodler


    And it also shows 2 in 2011 and 2 in 2012 which makes 6.5bn.

    My understanding is 1bn is coming from capital in 2011 (at least) as well as 2012 so either they are including it there or they are not. Either way it gives you an overall figure of 8.5 or 6.5, not 7.5.

    I'm a little obsessive.


  • #4
    Économiste Monétaire
    Closed Accounts Posts: 2,208 ✭✭✭Économiste Monétaire


    Aye, it's odd. €8.5bn would seem more realistic to me. The European Commission estimated a cyclically adjusted deficit (last page) of around 8.6% of GDP for 2010, or approx. €13.9bn. A deficit of 2.9% of GDP in 2014 is about €6bn, so that's a gap of €7.9bn (it's €8.9bn if you use the structural balance instead). This depends on the rather optimistic assumption of 4% average real GDP growth. I think I speak for all economists when I say: stop producing point estimates, give the fucking standard errors :mad:.


  • #5
    noodler
    Registered Users, Registered Users 2 Posts: 26,726 ✭✭✭✭noodler


    Économiste Monétaire wrote: »
    Aye, it's odd. €8.5bn would seem more realistic to me. The European Commission estimated a cyclically adjusted deficit (last page) of around 8.6% of GDP for 2010, or approx. €13.9bn. A deficit of 2.9% of GDP in 2014 is about €6bn, so that's a gap of €7.9bn (it's €8.9bn if you use the structural balance instead). This depends on the rather optimistic assumption of 4% average real GDP growth. I think I speak for all economists when I say: stop producing point estimates, give the fucking standard errors :mad:.

    http://www.irisheconomy.ie/index.php/2010/10/19/about-the-e75-billion-cumulative-adjustment-figure/#comment-84807

    Karl Whelan is just as confused as me! Which is always nice.


  • #6
    Économiste Monétaire
    Closed Accounts Posts: 2,208 ✭✭✭Économiste Monétaire


    Philip Lane on nominal GDP growth projections and the four-year budget plan:

    http://www.irisheconomy.ie/index.php/2010/10/20/are-the-gdp-numbers-surprising/


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