Date Released: 12 July 2016
SIPTU economist, Marie Sherlock, has said that the revised GDP and GNP figures for 2015, published today by the Central Statistics Office, hugely mask the true performance of the Irish economy and called on the Government to clarify their impact on its budgetary plans for 2017.
“Relocation of corporate assets, exports artificially inflated by third country contract manufacturing flows and aviation leasing appear to have driven much of the increase. While these movements have fed into very strong corporate tax revenues which grew by just under 50% in 2015, there appears to be little or no associated employment gain.
“These figures show the Irish economy is significantly overheating relative to our potential growth rate while the reality for working people is that income and employment are improving at much more moderate pace. Employment grew by 2.6% in 2015 and with unemployment running at 7.8% and annual average earnings rising by just 1.2% last year, the Irish economy appears to be still operating below capacity. Most importantly, the figures indicate the opportunity for major changes to the budget arithmetic for 2017.
“Ireland’s structural balance is likely to become much worse as the GDP figures show Ireland growing way beyond trend growth, but there is a very large once off boost to the expenditure base.
The Government must maximise this opportunity and use the additional available fiscal space for much needed investment into housing and other social and economic infrastructure in 2017.”