Tuesday, October 23 08:19:20
Ireland reported a spectacular drop in the deficit to 13.4 per cent from 30.9 per cent as the one-off expense of shoring up the banking sector disappeared from the books. However, the State's debt jumped to 106.4 per cent from 92.2 per cent according to the European Union's statistics office in Luxembourg. Across the euro region the combined debt burden surged last year to the highest since the start of the single currency as governments struggled to fill budget gaps and contain the fiscal crisis. The debt of the 17 nations using the euro climbed to 87.3 per cent of gross domestic product in 2011 from 85.4 per cent the previous year.
But the region's fiscal deficit fell sharply last year as governments slashed expenses and raised taxes to regain market confidence in their public finances. Greece had the highest debt in Europe last year, reaching 170.6 per cent of GDP even though it reduced its deficit to 9.4 per cent from 10.7 per cent in 2010 and 15.6 per cent in 2009. The 2011 Greek deficit number is 0.3 percentage points higher than estimated by Eurostat in April, mainly because of a downward revision of Greek economic growth, Eurostat said. The euro zone's biggest economy, Germany, slashed its budget deficit to 0.8 per cent in 2011 from 4.1 per cent in 2010 and its debt fell to 80.5 per cent of GDP from 82.5 per cent. The Irish Times
The sale of a 17pc stake in the vehicle that controls NAMA is good news for the Government. It means debts of E28bn owned by the agency to bailed-out banks will not now be included in official European calculations of the national debt. That became a risk when the state took control of Irish Life earlier this year. At that time Irish Life owned the 17pc stake in the "special purpose vehicle" (SPV) that had been set up to bring private investment into NAMA through a structure designed purely to keep the massive toxic debt agency off the national accounts.
Back in 2010, when NAMA was set up, its borrowings had threatened to damage the country's credit profile if they were added to the national debt by international agencies including the European statistics agency Eurostat that monitors the so-called 'Maastricht criteria' setting out maximum debt levels for countries in the euro. The SPV was set up to get around that problem by bringing in private investors to hold a majority stake in the key parts of the NAMA structure.
The original investors were funds managed by AIB Investment Management, Bank of Ireland's New Ireland Assurance and Irish Life and Permanent. They each took a 17pc share of the SPV in exchange for a E17m investment. NAMA has refused to say how much the stake was sold for, despite it and Irish Life being government owned, but the price is likely to have been relatively modest. The Irish Independent
The Government has repeatedly turned down requests for heavily indebted people to have early access to their pensions to pay down their borrowings. Employers' body IBEC, the Irish Pensions Funds Association and various backbenchers think it a good idea. But another branch of the State may end up getting its hands on your pension anyway -- the banks.
If you are in trouble with your mortgage and opt for what is known as a split mortgage, you may find the pension you are hoping to access when you retire could be used to clear the mortgage. A split mortgage is where some of the principal is 'parked', and you make payments on the rest. It is a way of making monthly repayments more manageable.
AIB and EBS will not charge interest on the parked element, while Permanent TSB will charge some interest on this. Bank of Ireland will charge full interest on the parked part of the mortgage. But how do you eventually deal with the warehoused or parked part of the mortgage? This is where you end up losing your pension lump sum, as first reported by this newspaper months ago. The Irish Independent
Poor summer weather and growing consumer fears on the coming Budget prevented Irish retailing from breaking out of its long-running downward spiral in the third-quarter of this year, with the latest sales figures showing a fall of 1pc compared with Q3 last year. The statistics from Retail Excellence Ireland (REI) show that computer and related sales fell hardest, down 20pc on the previous Q3, followed by garden centre (down 8.5pc) and photo/cameras (down 7.1pc).
Sectors hit by a flat property market continued to slump with home and giftware down 5.6pc and furniture and flooring sinking by 4.3pc. Ladies fashion fell by 3.2pc. Both it and the gardening sector were hit by the washout summer weather. "Most worrying for us is that July was the better of the three months while a downward trend continued right through to September -- the worst month of the quarter with a fall of 1.5pc recorded," says the REI's chief executive David Fitzsimons. The Irish Independent
Global food buyers are reacting very positively to Origin Green, Bord Bia's new sustainability development programme for the E8.85bn Irish food and drink export industry. Given its formal international launch yesterday at the food and drink expo Sial in Paris, Origin Green will give Ireland an advantage in competing for private label ingredients for large global food retail groups, an increasing number of whom are seeking to include sustainability stamps on their packaging.
Bord Bia chief executive Aidan Cotter said: "All global retailers will eventually need to show that they are operating sustainability programmes, and sourcing ingredients produced in a way that is conscious of the environment. In terms of Ireland's international reputation, Origin Green will be a real game changer. "Ireland has taken a lead in this for now. We are a small country and we have been able to move quickly. New Zealand is also strong on sustainability, but they don't produce the national scale survey that we do to help farmers to improve their scores on this issue."
Origin Green capitalises on existing Bord Bia-led traceability programmes such as the beef quality assurance scheme, which costs E3.5m annually. The new equivalent scheme for dairy will cost E1.4m annually. The audits of processing plants will be self-financing in that they will be paid for by the processing companies.
Bord Bia's industry recruitment for Origin Green started in June and to date 79 companies, accounting for over 50pc of Irish food and drink exports, have signed, including each of the 15 companies exhibiting at Sial this week. Of Ireland's 18,000 dairy farms, 8,000 are already members of the beef scheme. The Irish Examiner