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The Maastricht returns for September 2012 have been published on the Department’s website

General Government Deficit

The tables show that Ireland’s headline deficit in 2011 was 13.4 per cent of GDP. A significant amount of this deficit arises from capital injections into financial institutions that took place in July last year . (see Treatment of July 2011 banking injections below).

The underlying balance excludes the effect of capital injections into financial institutions in 2009, 2010 and 2011 and gives a better picture of the balance of receipts and expenditures of general government. There are no deficit-impacting capital injections in 2008 and 2012.

Ireland’s underlying deficit fell by 1.6 percentage points to 9.1 per cent of GDP in 2011, well below the EU-IMF programme limit of 10.6 per cent. We note that this indicates an improved position from the end-March estimate of the 2011 underlying deficit

Treatment of July 2011 injections into banks

In July 2011, a net amount of €16.5 billion was injected into Irish financial institutions. Following the finalisation of the restructuring plans of Allied Irish Bank and Irish Life & Permanent and discussions with Eurostat, it has now been determined that €6.8bn of the €16.5 net injection is classified as a deficit-increasing capital transfer. The effect of this €6.8bn is to add 4.3 per cent of GDP to the deficit for last year. This amount was provisionally estimated in the end-March return at €5.8bn.