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The budget will take a big hit next year because of Irish Water: ESRI

But at least things are looking good for jobs and the economy.

THE GOVERNMENT WILL clock up a bigger deficit than expected next year because of the hit to the public purse from Irish Water, the ESRI says.

In its latest quarterly economic commentary, the economic think-tank said the forecast revenue from water charges in 2015 was “likely to be less positive than previously expected” after developments over the past 3 months.

That would force the government to boost its subsidies to the controversial semi-state agency and would punch a bigger hole in the budget deficit – which the ESRI predicted would stand at 2.4% next year.

It had forecast a deficit of only 2.1% in its previous commentary, which came out about a week before the Budget was handed down.

But the ESRI noted the government faced an even bigger time bomb in the form of Irish Water’s market test from the European Commission, which it need to pass to keep the quango off its balance sheet.

If it fails to receive at least 50% of its revenue from private sources, its borrowing must be included in the general government deficit, which poses a further risk to the 2015 deficit forecast,” the commentary said.

The ESRI predicted the government would have to spend an extra €200 million on total subsidies next year when compared to 2014.

The market test

Last month Environment Minister Alan Kelly announced a cut-price regime of water charges in the form of two flat rates that will last until the end of 2018.

The government said the two rates – capped at €60 a year for single-person households and €160 for all others – would bring in €271 million, on top of €229 from businesses.

In return, it expected to have to hand over €399 million for Irish Water’s operating expenses – 44% of the total, or about €50 million less than the maximum allowed under the market test.

But one recent poll found one-third of all households would refuse to pay their water charges.

Meanwhile, the government said it was targeting one million registrations by Christmas – although to meet its domestic income target it needs virtually all eligible households to get on board.

Unemployment down, growth up

Elsewhere, the ESRI predicted unemployment would reach its lowest point since 2008 next year and would fall to “just over” 9.5% during the year.

That would include nearly 50,000 more people being in work than this year, although it expected only a 1% rise in average hourly earnings for workers after several years of falling wages.

Economic growth would be over 4.5% according to both Gross Domestic Product (GDP) and Gross National Product (GNP), which many consider a better measure as it only gauges income that stays in domestic hands.

ESRI ESRI ESRI

“This reflects increases in personal consumption and particularly stronger growth in investment than had previously been anticipated,” the commentary said.

READ: Budget 2015 made rich people richer and poor people poorer >

READ: Nearly everyone in Ireland will have a job again by 2020* >

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54 Comments
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    Mute john g mcgrath
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    Aug 23rd 2017, 9:41 AM

    Fair play to them they are right to want to govern themselves unlike or seagulls here who follow all the orders from Berlin

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    Mute Chris Mansfield
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    Aug 23rd 2017, 9:48 AM

    @john g mcgrath: What are the practical consequences of this decision, beyond some trite comment.

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    Mute Coner Willis
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    Aug 23rd 2017, 9:52 AM

    @Chris Mansfield: Don’t ask him that!! He will have no idea how to answer, and will instead make a personal attack on you. That is, if he is anything like most brexiteers. All we can do now is pray that he will ignore you…

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    Mute john Appleseed
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    Aug 23rd 2017, 9:55 AM

    @john g mcgrath: British justice?! Don’t make me laugh. Ask them Birmingham six what they think of British justice.

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    Mute Paddy Reid
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    Aug 23rd 2017, 10:01 AM

    @john g mcgrath: I don’t think seagulls follow our orders. They seems to be live in a ruthless, lawless society where the only acceptable currency is chips, and they can be obtained by any means necessary.

    87
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    Mute john g mcgrath
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    Aug 23rd 2017, 10:02 AM

    @Coner Willis: Eric Cantona was right when he said “The seagulls follow the boats ……..

    17
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    Mute Coner Willis
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    Aug 23rd 2017, 10:07 AM

    @john g mcgrath: That was a highly insightful comment! Cantona! Seagulls! Brilliant!! Now if you could kindly explain, the meaning behind your first comment, I’d appreciate it.

    41
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    Mute Carl Nolan
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    Aug 23rd 2017, 10:12 AM

    @john g mcgrath: Well let’s wait a few years and see how it goes.

    18
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    Mute Chris Kirk
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    Aug 23rd 2017, 10:26 AM

    @john Appleseed: Wait till Gina Miller gets her teeth into Theresa May there will be feathers everywhere, a lame duck prime minister.

    23
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    Mute Warthog
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    Aug 23rd 2017, 12:05 PM

    @john g mcgrath: Yeah correct,,,,The EU that is the cover for The 4th Reich.

    17
    JayK
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    Mute JayK
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    Aug 23rd 2017, 12:29 PM

    It takes a special kind of person to look at the ongoing catastrophe that in Brexit and think “we should be more like that!”. It’s like watching your neighbour’s house burn down and deciding to take a lighter to your curtains.

    52
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    Mute Paul Furey
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    Aug 23rd 2017, 12:42 PM

    @JayK: they better start rewriting and britifying their laws. They don’t have long left!

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    Mute Shane Cormican
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    Aug 23rd 2017, 1:11 PM

    @john g mcgrath: Sad thing is, German law is prob better then ours, our issue might be in its interpretation as we feck it up.

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    Mute Tomasz Irlandczik Krótki
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    Aug 23rd 2017, 1:29 PM

    @john g mcgrath: but they don’t know how to! They apply the law on a class-based system with certain classes deemed to be immune to the full rigours while some, especially non-British citizens, being treated on a shoot-to-kill basis, with immunity from prosecution for police.

    16
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    Mute Aidan Clarke
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    Aug 23rd 2017, 1:37 PM

    @john g mcgrath: I dont know what age you are but before we joined the eu ireland was only a back water ran by priests and backhand politics. No comparison between the country then and now

    30
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    Mute Seamus Mc Meel
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    Aug 23rd 2017, 5:24 PM

    @Warthog: Priceless,coming from an apologist for the White Supremacists!

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    Mute Fank Pulman
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    Aug 23rd 2017, 9:41 AM

    No more interference in UK legislation is a good thing – and something we should have…

    131
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    Mute Chris Mansfield
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    Aug 23rd 2017, 9:47 AM

    @Fank Pulman: Pulling out of the ECJ is insanity. For example, it means they also have to leave Euratom, so no fuel for their nuclear power stations, no access to radioactive isotopes used in medicine, no participation in nuclear research projects. It’s the kind of thing that happens when ideologues dominate over pragmatists.

    160
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    Mute John003
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    Aug 23rd 2017, 9:51 AM

    Other countries in the world have Uranium apart from EU…..Dont think there are any Uranium mines in the EU…..They are in Russia and the US….

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    Mute Fank Pulman
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    Aug 23rd 2017, 10:01 AM

    @Chris Mansfield: Hinckley Point in Somerset is being financed by the French and Chinese governments to the tune of £18 billion – alternatives to Euratom exist.

    23
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    Mute B9xiRspG
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    Aug 23rd 2017, 10:10 AM

    @Fank Pulman: True Fank – now they can opt out of the social chapter and screw the workers….

    In 1986, the European Court of Justice nullified the UK’s right to opt out of the Social Chapter, a charter of social rights including a directive on working hours.

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    Mute B9xiRspG
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    Aug 23rd 2017, 10:11 AM

    @Fank Pulman: Now they can export their mad cow disease what could possibly go wrong …..

    In 1998, the court refused to strike down a global ban on on the export of British beef following the mad cow disease outbreak.

    20
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    Mute Fank Pulman
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    Aug 23rd 2017, 10:18 AM

    @B9xiRspG: The electorate of the UK have made the decision to leave the EU; it’s nothing to do with us who just constantly moan about how it treats us!

    34
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    Mute B9xiRspG
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    Aug 23rd 2017, 11:12 AM

    @Fank Pulman: The electorate were lied to – a fact that isn’t been disputed by either side now. The 350million per week that would be put into the health service is a prime example.

    Your original statement “No more interference in UK legislation is a good thing – and something we should have…”, highlighted that no more interference was a good thing, ignored the fact that the ECJ have prevented the UK was implementing laws on its own people that were unjust and unfair.

    33
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    Mute Chris Kirk
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    Aug 23rd 2017, 11:20 AM

    @Fank Pulman: Not so sure about that Fank, legislation created on the hoof is bound to be challenged to see how watertight it is. We have already seen episodes of tory arrogance and missmangement overturned by the UK supreme court.

    17
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    Mute Chris Kirk
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    Aug 23rd 2017, 11:23 AM

    @Fank Pulman: On the contrary it has everything to do with us where our borders are concerned.

    14
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    Mute Fank Pulman
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    Aug 23rd 2017, 11:29 AM

    @B9xiRspG: Your last point – ‘in your view’…

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    Mute Ken Loughman
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    Aug 23rd 2017, 2:05 PM

    @Fank Pulman: It has a lot to do with us. Where have you been over the last year or so?!

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    Mute Fank Pulman
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    Aug 23rd 2017, 3:11 PM

    @Ken Loughman: The decision is not ours…

    4
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    Mute Danny Rafferty
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    Aug 23rd 2017, 10:07 PM

    @Fank Pulman: No more watering down of EU policies and laws to suit one state that could never get off the fence will be a great thing.

    1
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    Mute Kevin Barry
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    Aug 23rd 2017, 10:04 AM

    The Brits were always deluded by the EEC / EU. The red top headlines used to read ” We will be running the whole show within a fortnight ” when they joined . The have a massive budget deficit, yet waste millions on an aircraft carrier that they cannot afford, to maintain their belief that they are a World Power.
    I think they are bringing all these ideas forward to cause a default exit and then they will turn around and say it was the EU that was at fault.

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    Mute Fank Pulman
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    Aug 23rd 2017, 10:10 AM

    @Kevin Barry: Still, the UK remains the 5th biggest economy on earth. And we are one of its largest trading partners….

    53
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    Mute Kevin Barry
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    Aug 23rd 2017, 11:04 AM

    @Fank Pulman: For the moment. If you see how integrated their car manufacturing industry is with the EU without being a member of at least the customs union then that will tank.
    Exported services account for 40% of their tax take, under WTO rules services are not included.
    Unless they come to their senses their economy will collapse.

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    Mute Fank Pulman
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    Aug 23rd 2017, 11:15 AM

    @Kevin Barry: Our economy is much more likely to fail – it would have, without the bailout. Remember.

    12
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    Mute Francis Devenney
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    Aug 23rd 2017, 11:38 AM

    @Fank Pulman: The UK has fallen to 9th place. and will continue to fall.
    https://www.ft.com/content/7508bf1e-8a46-11e6-8cb7-e7ada1d123b1

    22
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    Mute Kevin Barry
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    Aug 23rd 2017, 11:42 AM

    @Fank Pulman: Our economy will be affected, no doubt about that , but bear in mind that the Irish exports to the UK are just 10% of our total exports.
    I know it is a very important 10% as it represents 40% of our food exports. We have two years to diversify our food exports, thus lessening the impact of Brexit.

    27
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    Mute George Hogan
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    Aug 23rd 2017, 3:40 PM

    @Kevin Barry: Germany is sourcing new quality beef and lamb markets and is eager to buy more of our farm products. Japan, the US and Canada are also emerging markets for our animal products.

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    Mute Pat Aherne
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    Aug 23rd 2017, 5:11 PM

    @Fank Pulman: Soon to lose it’s ranking.In fact doing so as we speak (their language).

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    Mute Danny Rafferty
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    Aug 23rd 2017, 9:46 PM

    @Fank Pulman: 6th actually

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    Mute Brian Farrell
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    Aug 23rd 2017, 9:41 AM

    Not looking very well Madam Prime-minister.

    57
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    Mute Fox
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    Aug 23rd 2017, 9:44 AM

    @Brian Farrell: How is this relative?

    39
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    Mute john Appleseed
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    Aug 23rd 2017, 9:54 AM

    @Brian Farrell: well of course when it’s a woman let’s all focus on her appearance rather than her words. Stupid comment

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    Mute B9xiRspG
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    Aug 23rd 2017, 10:12 AM

    @john Appleseed: To be fair compared to a year ago she doesn’t look well – not in beauty but health wise. Pressure of brexit?

    14
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    Mute Collette Butler
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    Aug 23rd 2017, 10:59 AM

    @B9xiRspG: I got what you meant….she doesn’t look well! I couldn’t give a shït what she looks like aesthetically but compared to when she was sworn in, you can see the stress & worry all over her face!!!!

    13
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    Mute Fank Pulman
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    Aug 23rd 2017, 11:08 AM

    @Collette Butler: rubbish – bad journal photo

    9
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    Mute Fred Jensen
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    Aug 23rd 2017, 11:45 AM

    @Fox:

    I think you meant to say relevant, not relative.

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    Mute Collette Butler
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    Aug 24th 2017, 11:48 AM

    @Fank Pulman: rubbish why??? It’s not just one picture I’m talking about….She looks desperate lately…shook, shocked & increasingly wrinklier by the week!!!

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    Mute David Harold
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    Aug 23rd 2017, 10:28 AM

    It is starting to sound like the UK want to have their cake and eat ours when it comes to their negotiating tactics.

    36
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    Mute Tommy Whelan
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    Aug 23rd 2017, 10:43 AM

    @David Harold: its a bit like Ireland when it became independent . We had the best of both worlds . We wanted to be independent but have all the benefits as if we where still in the UK . Only now after 90 odd yrs we are about to realise what it means to be economically independent from UK as both countries go in two different directions .

    28
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    Mute Boganity
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    Aug 23rd 2017, 10:45 AM

    @David Harold: The UK’s Brexit policy changes so often if you don’t like any aspect of it…wait 5 minutes.

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    Mute George Hogan
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    Aug 23rd 2017, 3:53 PM

    @Tommy Whelan: Totally fallacious statement. Ireland trades 10% of its goods with the U.K. We buy six billion euro more from the UK, than it buys from us. We are the UK’s 5th biggest trading partner. We buy a third of what the US buys from the UK and half of what the UK sells to Germany. Compare Canada and the US, where Canada exports almost 80% of its products to the US. We trade 40% in animal products to the UK; new trade deals with Japan, Germany, the US and Canada will lessen any negative impact by Brexit.

    3
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    Mute Fred Jensen
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    Aug 23rd 2017, 9:51 AM

    Such BS. When are the British going to learn they will have to accept the authority of some non-British court if they want to trade with anyone. Who rules on disputes between Briitsh and American firms? Do they think only British judges? They’re like pathetic stroppy teenagers.

    90
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    Mute Fank Pulman
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    Aug 23rd 2017, 10:04 AM

    @Fred Jensen: There will be courts, yes – just not EU ones! Keep up.

    53
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    Mute Carl Nolan
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    Aug 23rd 2017, 10:16 AM

    @Fank Pulman: So essentially the same trade arrangements and courts just with different names to keep the Little Englanders happy.

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    Mute Fred Jensen
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    Aug 23rd 2017, 10:24 AM

    @Fank Pulman:

    Oh there will be EU ones, don’t worry your little head. IF the UK wants to trade with the EU.

    25
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    Mute Fank Pulman
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    Aug 23rd 2017, 10:30 AM

    @Fred Jensen: You didn’t read the article then¿

    9
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    Mute B9xiRspG
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    Aug 23rd 2017, 11:19 AM

    @Fank Pulman: The ECJ is the hightest count in the EU, after brexit the UK will not be part of the EU so it will not fall under its control.

    With the trade and services the UK might find itself in other EU courts just like the jurisdiction over them by US courts when dealing in the US.

    11
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    Mute Ben McArthur
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    Aug 23rd 2017, 11:24 AM

    @Fred Jensen: Would the EU accept the superior jurisdiction of the British courts? Unlikely.

    10
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    Mute Steven C. Schulz
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    Aug 23rd 2017, 7:02 PM

    @Ben McArthur: It will have to be a bespoke dispute resolution court, such as with most trade agreements, but will also need to have subject matter jurisdiction over issues brought by British and European expatriates.

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    Mute Danny Rafferty
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    Aug 23rd 2017, 9:55 PM

    @Fank Pulman: And what about GDPR Frank?
    I think you’ll find most British export and service companies are going to be operating under ECJ data protection law if they want to do business with the EU – no matter what.

    1
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    Mute Brian Ward
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    Aug 23rd 2017, 9:54 AM

    How is this going to affect the GFA considering that the agreement is based on European law. Will there have to be a new agreement reached of can we just assume that the Good Friday Agreement is gong to become null and void?

    20
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    Mute John003
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    Aug 23rd 2017, 10:05 AM

    @Brian Ward: Not sure DUP and SF are that bothered anymore about working the agreement….Seem happy with direct rule no difficult decisions to make….

    18
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    Mute Brian Ward
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    Aug 23rd 2017, 12:08 PM

    @John003: How is this going to affect the GFA considering that the agreement is based on European law. Will there have to be a new agreement reached of can we just assume that the Good Friday Agreement is gong to become null and void?

    4
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    Mute Danny Flynn
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    Aug 23rd 2017, 12:13 PM

    I wish the red thumb was back to show how many people are against what is posted here

    20
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    Mute Danny Rafferty
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    Aug 23rd 2017, 9:57 PM

    @Danny Flynn: They would just bot that too I’m afraid.

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    Mute Chris Kirk
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    Aug 23rd 2017, 11:30 AM

    The UK is bound by repeating the mistakes of their own history. Look what hapened in 1649 when they decided that a Republic was a good idea and then ten years later they wanted their monarchy back again.

    11
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    Mute ADLynch
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    Aug 23rd 2017, 9:51 AM

    Don’t let the door hit you on the arse on the way out.

    42
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    Mute Colm Flaherty
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    Aug 23rd 2017, 10:22 AM

    Hard Brexit it is then.

    Willing to bet money the death penalty will be back on the agenda when this is seen out. “Bring back hanging” went the joke. No joke any more.

    16
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    Mute Fank Pulman
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    Aug 23rd 2017, 10:26 AM

    @Colm Flaherty: never was m8

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    Mute Colm Flaherty
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    Aug 23rd 2017, 11:44 AM

    @Fank Pulman: needs to be. Anyone who looks for the death penalty in this day & age needs to be defended against as dangerous.

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    Mute Pat Troy
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    Aug 23rd 2017, 10:28 AM

    Who cares what they do.

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    Mute Fank Pulman
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    Aug 23rd 2017, 10:33 AM

    @Pat Troy: as one of their largest trading partners, we should…

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    Mute Pat Troy
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    Aug 23rd 2017, 10:36 AM

    @Fank Pulman: they trade more with us than we with them.

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    Mute Fank Pulman
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    Aug 23rd 2017, 10:46 AM

    @Pat Troy: Nearly 40% of our food and drink is exported to the UK – more than all other EU countries, combined!

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    Mute Pat Troy
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    Aug 23rd 2017, 10:49 AM

    @Fank Pulman: Britain sells more to us than the do to Russia, China, Brazil, combined

    18
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    Mute Chris Kirk
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    Aug 23rd 2017, 11:34 AM

    @Fank Pulman: The fact that the UK buys so much food from Ireland shows that they are not capable of producing it for themselves, otherwise they wouldn’t be buying it. Lets see how the get on with the salty South American chicken before judging where their prefered market is.

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    Mute Cathal Mac Einri
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    Aug 23rd 2017, 11:39 AM

    leaving the ECJ seems very important to the Tories, they are obsessed about it. The british will be the ones to suffer. wouldn’t open access to the common market require some sore of compliance with the ECJ?

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    Mute Cathal Mac Einri
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    Aug 23rd 2017, 11:43 AM

    @Cathal Mac Einri: the European Court of Human Rights will probably be next

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    Mute johnp
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    Aug 23rd 2017, 1:09 PM

    @Cathal Mac Einri: I know just think about all those poor criminals who won’t be able to appeal their deportation on human rights grounds oh the humanity

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    Mute Pat Aherne
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    Aug 23rd 2017, 5:03 PM

    @Cathal Mac Einri: From what I see the brexiteers think it’s all the one.

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    Mute Danny Rafferty
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    Aug 23rd 2017, 9:59 PM

    @George Harvey: King George is back.

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    Mute Macc Dan
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    Aug 23rd 2017, 2:34 PM

    once Britain did not join the euro. the writing was on the wall for their continuing membership of EU.

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    Mute Colin Morris
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    Aug 23rd 2017, 1:37 PM

    Were it not so worrisome for Ireland it would be hilarious to witness Britain circling the drain as it’s been doing since that small minded, racist, formerly powerful country voted to shoot itself in the foot.

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    Mute Johnnie Sexton
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    Aug 23rd 2017, 1:05 PM

    Another head of government away with the fairies, are the crowd in the north still being paid seeing stormont still in limbo……

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    Mute Donal Milmo-Penny
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    Aug 23rd 2017, 2:06 PM

    The UK have a highly developed legal system… defering to the ECJ as a higher authotlrity, whilst it has been made work, is not inherently logical as the UK employs a Common Law system and the ECJ does not. Coherent argument as to why this is a good or bad idea would be good here in place of the diatribe.

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    Mute John Dixon
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    Aug 23rd 2017, 10:54 AM

    The leaders of the UK need to shut up telling us what they are going to do and just do it.
    Put your money where your mouth is prime minister and do what you have to do.
    These daily Brexit updates that the UK are going to do this and they are going to do that are becoming boring to be honest.

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    Mute Brian O Reilly
    Favourite Brian O Reilly
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    Aug 23rd 2017, 2:48 PM

    It’s going to be a bitter divorce,and one of its children is going to have a tough time adjusting,But we all have to leave the nest sometime and gain true independence.

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    Mute John Brennan
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    Aug 23rd 2017, 10:12 AM

    @john Appleseed:
    You have to admit her leopard skin kitten heels are quite kinky and arousing when matched with a knee length leather skirt

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    Mute Pat Aherne
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    Aug 23rd 2017, 5:07 PM

    @John Brennan: Now we’re getting somewhere.

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    Mute Joe Thorpe
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    Aug 23rd 2017, 4:27 PM

    I don’t get why Ireland gets so excised, with the ill will here & your solid belief it will be a disaster for the UK so the good folk led by Varadkar (who clearly hates UK) should be smiling. The border issue will be decided by The EU not Ireland. I suspect we will use technology like we do in the UK (No tax, insurance or mot discs on our cars) & let ANPS a nd AI do the work. I presume the EU will need to base frigates & Fighter jets in Ireland to ensure the integrity of EU borders all of which will have nothing to do with the UK when we are gone. Maybe a few more fisheries protection vessels too & a few more coastguard helicopters? How’s the pipeline to France going that needs to get cracking if the EU wants energy security lol

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    Mute Chris Kirk
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    Aug 23rd 2017, 5:10 PM

    @Joe Thorpe: Maybe the Americans could lend us an aircraft carrier and a couple of destroyers, they seem to have a few to spare while they are not crashing them into merchant ships.

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    Mute John Brennan
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    Aug 23rd 2017, 6:12 PM

    @Chris Kirk:
    FFS when the aircraft carrier JFK came into Dublin port it crashed into a fishing trawler and was unable to take visitors on board

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    Mute Danny Rafferty
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    Aug 23rd 2017, 10:04 PM

    @Joe Thorpe: We are the EU Joe.
    And the border and customs union items will go our way or no way.
    And it’s our cake Joe and we slice it how we like.
    Ours.

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    Mute David Slattery
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    Aug 23rd 2017, 6:28 PM

    Ireland will be united by 2022

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    Mute Alois Irlmaier
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    Aug 23rd 2017, 10:53 PM

    @David Slattery: Some say by 2024 lol.

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    Mute ADLynch
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    Aug 23rd 2017, 9:47 AM
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    Mute Alois Irlmaier
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    Aug 23rd 2017, 10:53 PM

    May hasn’t a clue, all she is doing is making enemies out of friends?

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    Mute Paul Shepherd
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    Aug 23rd 2017, 6:31 PM

    That’s their sound bite for today. Undoubtedly they’ll reverse tack on this in the coming months. Fourteen months on all we’ve had is huffing and puffing with nothing concrete achieved. The UK have whinged about why the rules shouldn’t apply to them for the last forty years. At this stage I wish they’d just b*gger off and leave us all in peace.
    Rant over………!!!

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