The Government is to increase spending by 6 per cent to €43.6 billion in 2005, the Minister for Finance, Mr Cowen, announced today.
Presenting the Book of Estimates ahead of the December Budget, Mr Cowen said the main allocation was €11 billion for health services, an increase of €915 million or 9 per cent. The money will provide for an extra 30,000 extra medical cards.
Education is to get €7.1 billion in 2005, an increase of €530 million or 8 per cent, while the allocation for the Department of Social and Family Affairs is €11.4 billion.
Mr Cowen said the Estimates provided more than €2.8 billion for disability services, representing an increase of €290 million or 11 per cent on 2004.
The Department of Transport has secured €2.119 billion, an increase of 7 per cent for new roads, integrated ticketing on public transport and a new train station in Dublin's docklands.
Anyone expecting a great giveaway budget, however,
will be sorely disappointed by Mr Cowen's spending plans which err on the cautious side of neutral. Outside of health and education, other departments will receive increases in line with growth estimates of around 5 per cent.
Any extra spending will be generated from savings under the five-year spending plans known as the "McCreevy envelopes".
In contrast to times past when bulging coffers heralded a budget bonanza, Mr Cowen warned that a spending spree would only overheat the economy and damage competitiveness. " We have come too far to expose ourselves to such a threat."
The public service pay bill will increase by over €:1 billion to €15.2 billion due to increases agreed under the national wage agreement (€530 million), benchmarking €170 million and additional numbers in the public service (€130 million).
Mr Cowen said overseas development aid would increase by €60 million in 2005 and promised further increases in 2006 and 2007. Next year's increase of 15 per cent will bring Ireland's contribution to some €535 million, up 240 per cent since 1997.
The Minister said he wished to "ensure that the economy continues to support economic growth and employment while generating resources for key social and economic public services and investment priorities".
The estimates provide for some leeway in increases in numbers of teachers and health staff but the Minister said he remained committed to reducing public service numbers by 5,000 in line with previous promises.
Economic growth in 2004 will be about 5 per cent, he added but pointed to a number of risks including oil prices, the dollar and a possible weakening of the US economy that could lead to a slowdown in domestic economic activity.
Speaking earlier today, the Taoiseach said the Government had worked hard over the last four months to produce a Book of Estimates that pre-empts a "winner's budget".
Mr Ahern said that "because economic situations are good" and the "net position" of the average industrial worker has improved over the past three years, people can expect benefits across the board in next month's budget.