Charlie lets the good times roll

Spend, spend, spend . . . that seems to be the message in this week's Estimates. Who remembers the time the Minister, Mr McCreevy, said we could judge his performance by his ability to stick to his target of 4 per cent average growth over inflation in current spending?

What now for the Government's target? The latest news is that the Minister wants to stay within a 6 per cent growth target over and above the rate of inflation. In isolation, 6 per cent may not look that high, but it is still a 50 per cent slippage in his target.

More worrying is that this target is being met only with the help of repayment of our national debt. At a time of plenty, with the State coffers overflowing, this is no problem but what happens when the good times pass? Current spending in the year ahead will rise by 11 per cent and the lion's share of this is going in pay. That pay bill will still be there when the economy slows down - soft landing or not. Mr McCreevy has been fortunate to be Minister for Finance during one of the most benign periods for our economy. He has been somewhat hamstrung in his freedom to dictate economic policy by our membership of the euro zone.

He has also had the somewhat unenviable problem of dealing with tax revenue far in excess of what the best and the brightest in the Department of Finance expected, raising people's expectations come budget time.

But his budget policy has exacerbated the trend towards overheating and inflation. His Budget speech next month will probably be his last before an election; if he wants to go into that campaign as a prudent guardian of the State's finances, he is running out of time . . .