There has been little fanfare for the Government's Estimates of Public Expenditure which were published today. They are called "Revised Estimates" because in a normal year preliminary estimates are published in advance of the Budget showing how the Government intends to spend the money it will raise in the coming year. Revised Estimates are then published in February with refinements showing the final allocations to each Vote.
The revised Estimates published today are really the first opportunity to see what the supplementary Budget means for government spending. The headline figures show an 6% increase in current expenditure from €53.4Bn. to €56.6Bn. with an 19% decrease in capital expenditure, from €9.0Bn. to €7.3Bn..
Sadly, this was the pattern in the 1980s: cuts in current expenditure were resisted fiercely but capital expenditure i.e. investment in the future was slashed to the bone.
Guess what: our children can't vote (yet). For example, capital spending on Sport and Culture is cut by over 50% (so forget that swimming pool or youth centre) but current expenditure in this area is cut by just 6% so all the arts and sports organisers will continue to get paid.
This means the €20.35Bn. that the Exchequer is borrowing this year is largely for current spending. Indeed, can anyone say how much of the €7.3Bn allocated to capital expenditure will provide additional infrastructure future generations can enjoy while they are paying off the enormous debts which they will inherit from this era?
The cuts are anything but even-handed. Indeed, there are large increases are in the area of social welfare: the combined expenditure for Social and Family Affairs and the Social Insurance fund will increase from € 17.7Bn. to € 21.3Bn. - an increase of 20%. I think this can be explained in one word: unemployment.
Despite all the talk of cutbacks, the HSE will get an increase of 1.7% in their gross budget which will total €14.6Bn. . The total spend in the health area remains fairly static at € 16Bn. but the Office of the Minister for Children and Youth Affairs is slashed by 38%.
Table 6 of the Revise Estimates is particularly striking: it classifies current expenditure by function. Out of a total spend of €56.6Bn. , social expenditure (education, health, social welfare and housing) accounts for €46Bn. . Remember when the government was saying they would protect the needy from the cuts? Nonsense.
A much discussed figure is that for public service pay and pensions. According to Table 4, this total will be €17.8Bn.this year. A technical point is that a new item entitled "Receipts from Pension-related Deduction on Public Service Remuneration" is included under Appropriations in Aid for each Vote. This means that the savings on pay are balanced by an "income" which reduces the net total Vote.
Table 5 shows the numbers of staff that underlie that pay bill. Out of 370,000 staff (including pensioners), Health and Education account for 256,000. Add in 48,000 for Gardai and Defence, that leaves about 68,000 spread across some 36 Departments and Offices, most of which have less than 500 staff. Again, the scope for cuts is extremely limited if areas like health, education or security are regarded as sacrosanct.