The Minister for Finance may have hit his 4 per cent spending target again this year, but only by adopting new accountancy methods.

The measures allow the Minister to claim that he is holding average net spending to 4 per cent whereas, in reality, gross spending is 9.2 per cent, according to Mr Jim O'Leary, chief economist at Davy Stockbrokers.

When the recently announced social welfare package of £125 million (€159 million) is added this gives an overall increase of 10 per cent.

This was achieved in the Budget figures as some revenue into so-called "appropriations in aid" - which are revenues that go straight into departmental accounts and help pay for spending, thus lowering the recorded increases in spending from one year to the next. This is similar to the measure last year where changes to the health levy brought back the net spending figures.

According to Mr O'Leary, this year's changes are far more creative. The social insurance fund is in surplus and thus cannot be touched by the Minister. As a result he reduced employers' PRSI contributions from two rates of 12 per cent and 8.5 per cent to two new rates of 11.3 per cent and 7.8 per cent, a reduction costing £120 million.

At the same time he introduced a national training fund levy of 0.7 per cent, yielding £120 million. This means that money which would otherwise go into the social fund surplus is now an appropriation in aid to the Department of Enterprise and Employment.

Equally, the 50p increase in the price of cigarettes would normally go into the Exchequer's general coffers. This time, however, it is going as an appropriation to the Department of Health.

Altogether, according to Mr O'Leary, that is £252 million that counts against his spending target.

However, gross supply services, which is actual spending without appropriations and without central fund, has increased by an average 9 per cent in each of the past three years.