Statement

Eurostat Findings Show Significant Irish Progress on Reducing Government Debt – Hayes

Commenting on recent Eurostat figures, Brian Hayes MEP said: “Ireland has recorded the largest decrease in government debt-to-GDP ratio in the EU between 2013 and 2014. Eurostat has compiled these statistics which show that Ireland has made significant economic expansion in the space of one year.”

The findings show that Ireland’s debt-to-GDP ratio has reduced by 8.5% between the second quarter of 2013 and the second quarter of 2014, the next highest reduction was made by Germany which had a reduction of 2.7%.

“Last year our debt-to-GDP ratio was over 125%, much of this was due to long-term spending commitments set against short-term cash inflows which dried up. Now it is 116.7% and this will come down further because the government currently holds a high level of cash reserves and financial assets which can be used to lower the debt levels,” added Mr. Hayes.

“But we need to be disciplined about getting our budget in balance. Retaining a high debt-to-GDP level is completely unsustainable. By moving to bring our annual budget into balance we stop adding to debt and this in turn restores international confidence so that our recovery will be smooth and our finances in good shape.”

“The European Commission has set rules for Member States to get their debt-to-GDP ratios reduced to 60%. Ireland has a long way to go to meet this target but if we continue to reduce our government debt levels, we will be paying less interest on what we borrow and economic growth will be more sustainable,” concluded Mr. Hayes.

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