Irish Overseas Development Aid Slashed by €45 million

The Minister for Finance, Brian Lenihan, made a statement today concerning cutbacks the government will seek to implement as a result of the downturn in the economy. One of the main elements of government plans is a 3% cut to public payroll expenses by the end of 2009. The two departments with the largest payroll expenses, Education and Health are exempt from the planned cut. The Minister claims that the proposed measures will lead to savings of €440 million this year and €1 billion in 2009.

One area of some interest to many people I know is the cut in Overseas Development Aid (ODA) by €45 million this year. The Minister stated that this is as a result of 'the projected revision to GNP and other factors'. The Irish government remains committed to reaching the UN target of 0.7% of GNP on overseas aid by 2012.

It will be very interesting to know specifically where these cuts will be made. Many organisations rely on ODA to fund their development programmes and cutting the ODA budget can have serious consequences for many of these programmes. If it is bi-lateral projects that are to be affected the potential impact on Irish charity and non-governmental organisations would be less. Today's statement did not provide much detail and we will have to wait for individual Ministers to make their reports to the Dail on the proposed spending cuts. Those in the Irish development community will wait with interest for the details of the proposed plan.

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The Department of Finance has predicted a shortfall of €3 billion in tax revenue this year, while government expenditure is 11 per cent ahead of the same period for last year. The significant increase in the number of people receiving unemployment benefit in the State over the past several months has been a contributing factor to the increased expenditure.