Analysis: In many ways, the end-year Exchequer returns published yesterday contained no surprises.

Throughout 2005, and particularly towards the end of the year, the figures had pointed to two results - an underspend by Government departments and an overshoot in the amount of tax the Exchequer would take in.

In the end, the two combined to allow the Government to borrow €2.5 billion less than expected for last year. Rather than accepting this positive result at face value, however, it is worth examining the factors behind it.

On the spending side, the picture is fairly clear. Some Government departments didn't spend all their money on time, leaving a €705 million saving. Much of this - €564 million - was drawn from miscellaneous savings across various departments, while the remaining shortfall came from an underspend on the capital side.

Given the size of the capital budget for the year (€7 billion) and the chunky nature of projects such as roads, the mismatch between forecast and actual out-turn is understandable and is likely to be repeated.

What is less clear, however, is whether the last year's vast outperformance in tax revenues will continue to flood the State's coffers in 2006.

The taxes under most scrutiny here will be those related to the property market which, when combined with receipts from special investigations led by the Revenue Commissioners, delivered 80 per cent of last year's €1.8 billion tax overshoot.

The Minister for Finance, Mr Cowen, was definitive on this yesterday, saying he does not expect a "similar performance" from these tax heads in 2006. This implies an expectation that the property market will cool this year, thus bringing property taxes and perhaps taxes related to personal consumption back to more normal growth levels.

The department has had a similar expectation for the past two years but housing and other construction have continued to boom regardless. So what are the real chances of an easing in 2006?

Pat McArdle, chief economist with Ulster Bank, is fairly confident that "the end will not come" this year. For this reason, he expects tax revenue estimates to be beaten again in 2006, although he acknowledges that this will not continue forever.

Alan McQuaid of Bloxham agrees, predicting yesterday that the end-year 2006 Exchequer deficit could be up to €500 million lower than the €3 billion predicted by the Department of Finance on Budget Day last month.

Providing fuel for this outcome in 2006 will be the "feelgood" factors associated with the first batch of maturing Special Savings Incentive Accounts and the new "childcare supplements" due under December's Budget.

Mr McArdle points out, however, that the economic picture painted by the 2005 returns is not overwhelmingly positive. He highlights the income tax result which, when one-off contributions from the Revenue Commissioners are excluded, came in below target by €350 million. This was despite a surge in employment throughout the year.

"This sounds a cautionary note for the economic bulls," he noted.