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FINANCE MINISTER MICHAEL Noonan has said the “patent cliff” that saw a number of well-known pharmaceutical brands go off-patent last year was one of the main reasons for a distortion in GDP.
The economy shrank by 0.3 per cent in 2013 — in spite of a predicted growth of 1.3 per cent made in March of last year.
Noonan was asked about this year’s predicted GDP rise of 2.1 per cent for 2014 as he answered questions from the Oireachtas Finance Committee on the Government’s latest Stability Programme Update this evening.
Answering a question from Fianna Fáil’s Michael McGrath, who had asked how confident the Department could be about the the accuracy of the forecast, Noonan said the patent cliff had caused “a distortion” to last year’s figures.
The Finance Minister said that the fact that drugs like Lipitor and Viagra had gone off-patent had been a major factor.
“As they go off patent, they continue to produce them and the same number of people are employed in the pharmaceutical industry,” Noonan said.
That has given us a distortion and that’s the best explanation I can give you.
Adjustment
The stability update, announced earlier this evening, says the government should be able to hit its deficit reduction target, but only if it sticks with the €2 billion adjustment planned for Budget 2015.
The document will be submitted to the European Commission by the end of the month.
Noonan was also asked what this evening’s announcement would mean for middle-income taxpayers, after a number of Cabinet members raised the prospect of Income Tax cuts in recent months.
He repeated his promise to widen income tax bands as soon as it can be afforded, in order to take people out of the higher tax bracket.
“One of the aspects of the tax code which is most un-jobs friendly at the moment is that people on relatively small incomes have to go on the high rate of tax,” Noonan said.
I’m saying that my next move in relation to tax is to address that.If I don’t have some resources what I can do will be very small, but I’m pledged to doing something.
“If there’s a lot of movement then that’s where I’ll have the emphasis in the Budget,” the Minister said, adding “that’s not inconsistent with the correction we have to make”.
If it happens that there’s a big surge in tax receipts as the year goes by, or there’s a big fall in expenditure because a lot of extra people go back to work then we’ll welcome that and we’ll take it into account when we approach the Budget.
The SPU announced today also projects that unemployment will fall to 11.5 per cent this year from its current level of 11.8 per cent — predicated on the assumption that the labour force will continue to expand.
The general government gross debt was revised upwards by two per cent.
Angela Kerins, the reason I no longer donate money to charity.
@David Oppenshore: Well said sir. Money only going to pay CEO salary and outrageous expenses.
No charity, sporting or other such organisation should be given public money unless they first waive any ‘rights’ to protect themselves from public scrutiny of their finances. They can carry on freely without that money if they chose. Take it or leave it.
@Sega Yolo: totally agree
@Sega Yolo: perfectly said.
Imagine that. Kerins took home a ludicrous salary whilst miserably mismanaging the running of a charity and somehow is managing to outdo herself and create a lasting damage on the public’s ability to hold future disasters to account…
Just when you think you know the limits of someone’s toxicity to society, she goes and out does herself once more without even being in the room.
The Irish charity industry is destroyed by the greed of the few!
Vote with your feet,
Don’t give a penny to them!
@Niall Power: will never give a penny to any charity that pays their CEO and subordinates excessive salaries.
The pac committee full of incompetent politicians is not fit for purpose. The questioning of the fai officials the other day was very weak, pure amateurish, they really didn’t know their brief, what questions to ask.
@Adrian: they could have asked what day it was and still not received a straight answer.
@Dave O’Keeffe: they’re not legal experts, they were afraid to ask the questions the other day because of the potential legal repercussions, hence the farce that it was. They need legal experts on those committees, they should be able to come to some arrangement without turning them into tribunals. A bunch of incompetent politicians protecting their own interests, paying themselves 15k fees while asking stupid questions like “how many bank accounts do you have?”, turns the whole process into a joke and achieves nothing.
@Adrian: the questions were 100%. The problem was the FAI officials refused to answer. Nothing the pac can do about that.
@Adrian: They were told what they could ask “legally”. The law seems to protect the wealthy wrongdoers.
People in high positions have to be held accountable in public. However I struggle with the idea of giving the likes of Ruth Coppinger and others the power to carry out public investigations and give them compellabilty. If that became the case I could see people’s good name and reputation coming second to political point scoring.
Totally irrelevant nothing to do with FAI. The FAI is not a charity – it is a business and why they kept quoting the Kerins case is s mystery to me.
Looking at some of the motley members of various committees one would have to be dubious. Some are up to the task but many others fail miserably. Some are rude, arrogant, ill-informed and totally oblivious to their briefs. If they are that determined to cross the line then they should be open to full retribution in the courts. The verdict in the Angela Kearns case was spot on!!
@Chris Gaffney: I don’t know about that, why should good TDs and Senators who ask the difficult questions be muzzled by a ruling like that? I do get that there are some clowns on these committees, and they say things for headlines and there 30 seconds on sixone so the voters back home can see them sticking up to the dubs, but the real nature of these committees should be open, honest and sometimes difficult conversations with people like Delaney.
Lawmakers unhappy that the have to work within the law, my heart goes out to them.
Even if there was no Kerins ruling the public voted to reduce the powers of the committee so they are limited from the offset .
Kerins is looking for and going to get a multi million damages award for her suffering at PAC ..this is the biggest joke of all.
Delaney puffed and bluffed and ran circles round the PAC the Kearins judgment rules thst the PAC cannor go outside its remit or in other words tits terms of reference. Once the PAC keep within its remit lile asking questions on the €1000 loan then it would not fall foul on the Supreme Courts judgement.
Who can afford to bring a case to the High Court or Supreme Court ?
The Courts and Judges are only there to interpret the Law and ensure it is upheld. They do no make law.
If the PAC feel that the ‘Laws’ of our land are not sufficient, then it is up to them as legislators to change the ‘Laws’, so that their tongues are not tied when questioning individuals and agencies about their conduct. They have no one to blame but themselves for the situation the PAC finds themselves in.
1/ The Kerins issue is not case law yet, is awaiting determination on appeal, & is not relevant. Mr. D used the pending determination to ward off awkward questions, left them hanging out there, & thereby damaged his public standing.
2/ The committee did not need to subject anyone, including Mr. Delaney, to interrogation on their income or expenses, & just stay on track about the application of public funds & FAI corporate management. The investigative journalists have put these questions out, the public are expecting the FAI to provide the answers.
3/ Sport Ireland can with hold funding, insist on a forensic audit of the FAI accounts for the years when public funding was drawn down, & require appropriate governance structures, in accordance with the separate reviews already commissioned.
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