Stephen asked the Minister for Finance:

further to Parliamentary Question No. 198 and 199 of 1 May 2012 (see here), if he will confirm that he does not have estimates for the budgetary impact of meeting the structural deficit targets which are a key component of the Fiscal Compact Treaty; and if he will make a statement on the matter.

Ref No: 23480/12

Minister for Finance ( Mr Noonan) :

In my replies to earlier questions, I have stressed that our commitment is to get the deficit below 3 per cent of GDP by 2015.

In terms of the structural deficit, addressing this does not necessarily involve taxation and expenditure adjustments.  For instance, the ambitious programme of microeconomic reforms that is already underway is expected to help reduce the structural element of the deficit by the middle part of the decade.  One example is in the programme of labour market reform, where the Action Plan for Jobs 2012 and the Pathways to Work initiative include reforms aimed at addressing some of the skills mis-match in the labour market, which should help lower the unemployment rate.  This, in turn, would have a structurally beneficial impact on the public finances, on both the revenue and expenditure sides.

These and other factors make estimates of the budgetary impact of meeting our medium term objective subject to a high degree of uncertainty.