Cowen cautious on Budget surplus

Minister for Finance Brian Cowen yesterday sought to dampen expectations of significant expenditure increases in the forthcoming Budget.

Referring to comment yesterday in the wake of the October exchequer returns, Mr Cowen said he should point out that the tax receipt figures included almost €500 million raised through the Revenue's special investigations - money that would not form part of the tax base going forward. The returns indicated that the Minister would have €2 billion more than predicted in the Government coffers come Budget day.

Mr Cowen, addressing the annual dinner of the Institute of Bankers, said it was perhaps more useful to look at the costs of certain measures in Budget 2005. He said the social welfare package cost more than €870 million in a full year, while taking the minimum wage out of the tax net had cost almost €400 million.

"Looking at these figures perhaps helps to put in context some of the comments we've heard in relation to the end of October exchequer figures."

He said potential downside risks to our economic performance would also need to be monitored and evaluated in finalising the macroeconomic and fiscal framework for Budget 2006.

"Stability in our public finances has been hard-earned. I intend maintaining a responsible approach which will ensure that the strategic direction of our economy will focus on sustainable, real improvements in public services, social provision and infrastructure."

On the Government's ambitious transport plan, he said that notwithstanding "the predictable negativity from certain quarters, I believe we can rise to the challenge".