Bud­get sur­plus is very good news but ev­ery sil­ver lin­ing has a cloud

The Corkman - - OPINION -

MORE than a decade af­ter the eco­nomic crash and a lit­tle over nine years since the Troika bailout that cost the coun­try its eco­nomic sovereignty, there was some gen­uinely good news on the eco­nomic front this week. Taoiseach Leo Varad­kar last Thurs­day was able to take a mo­men­tary break from Brexit is­sues when he took to the podium out­side Gov­ern­ment build­ings to an­nounce that there was a bud­get sur­plus last year and the state’s cof­fer are ahead by €100 mil­lion.

Now, to be fair, we have to point out that it isn’t the first sur­plus since the crash as in 2017 there was a sur­plus of €1.9 bil­lion.

How­ever, that in­cluded a mas­sive cash wind­fall that came from the Gov­ern­ment’s sale of around €3.4 bil­lion worth of shares in AIB.

What is so sig­nif­i­cant about last week’s an­nounce­ment is that the sur­plus – the first gen­uine one since 2007 – is based on state spend­ing and tax in­come rather than any un­usual in­jec­tion of cash.

The Gov­ern­ment had ex­pected to re­turn to sur­plus bud­gets next year, so the news that it has come a full year ear­lier than ex­pected is to be wel­comed.

Mr Varad­kar, to his credit, did not try to spin the news as be­ing a re­sult of Fine Gael pol­icy and ac­knowl­edged that the ex­tra cash had come from a com­bi­na­tion of €250 mil­lion sav­ing on debt re­pay­ments and a surge in cor­po­ra­tion tax re­ceipts which came in over €1 bil­lion ahead of what had been fore­cast.

In the greater con­text of State spend­ing – the Gov­ern­ment spends about €70 bil­lion a year to keep the coun­try func­tion­ing – the sum of €100 mil­lion is drop in the ocean but it is the sym­bol­ism of the event that is im­por­tant.

Af­ter a lost decade, the coun­try’s fi­nances are back on a rel­a­tively even foot­ing and, with Brexit loom­ing on the hori­zon, Ire­land is in a far bet­ter po­si­tion to with­stand an­other eco­nomic shock than we were just a few years ago.

Now, all that is very good news for the coun­try but an­other set of fig­ures emerged last week that took a lit­tle bit of the gloss off news of the sur­plus.

While the Gov­ern­ment in gen­eral man­aged to “un­der­spend” by €250 mil­lion, one De­part­ment in par­tic­u­lar saw its ex­pen­di­ture sky­rocket.

Back in 2016 when Enda Kenny was in charge, the De­part­ment of the Taoiseach spent a rather pal­try €10,628 on ad­ver­tis­ing and mar­ket­ing.

By con­trast last year, ac­cord­ing to fig­ures re­leased by the Gov­ern­ment, Leo Varad­kar’s de­part­ment spent a whop­ping €1.3 mil­lion on mar­ket­ing.

More than half of the money was spent on the launch of the Pro­ject Ire­land 2040 cam­paign which set out the Gov­ern­ment’s plans for the coun­try in grandiose terms but which was widely slated by many as be­ing lit­tle more than a very ex­pen­sive Fine Gael elec­tion man­i­festo.

Per­haps if Mr Varad­kar’s De­part­ment was a less flaithu­lach with the PR cash, that sur­plus could have been even big­ger.

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