STATE SPENDING AND THE BUDGET

 

Sir, It is difficult to imagine what Ruairi Quinn must do, to satisfy certain lobby groups and commentators. In the period before Budget Day, on Budget Day and in the period since the Budget, there has been an incessant demand for reduced public expenditure by all kinds of interest groups, journalists, editorial writes, Opposition parties and even "economists".

This mantra seems to be based on the (either direct or implied) assertion that public expenditure is excessive, off the rails and out of control, which is simply untrue. The universally used comparative measure of public expenditure is the percentage of GDP devoted to such expenditure.

In Ireland's case, the percentage has fallen from 42 per cent in 1994 to a projected level of 35 per cent in 1997. This figure is the lowest of any country in the EU and compares with figures as high as 60 per cent in Denmark, 51 per cent in The Netherlands, 49 per cent in Germany, an average of 49 per cent for the EU as a whole and 42 per cent in the UK, after 18 years of Conservative government. - Yours, etc.,

Faculty of Business, Dublin Institute of Technology, Mountjoy Square,

Dublin 1.