The National Debt


#461

@2Pack - We were told the government finances would be in balance this year but I now see this document which sets out

the 2019 Exchequer Borrowing Requirement (EBR) on both a monthly and a cumulative basis

and which states that

Exchequer revenue of €74,308 million is projected for this year. Total Exchequer expenditure
is forecast as €76,698 million, resulting in an EBR of €2,390 million for the year.

Not clear about the discrepancy with the NTMA EBR figure of €2,100 million

https://assets.gov.ie/7169/e055748756a841e58823d381486d269a.pdf


#462

I might have figured it, the exchequer will borrow 2bn plus but the social insurance fund will end up with €2bn in cash (it only had €0.5bn at end 2016) so these net each other off leaving government ‘in balance’ in 2019.


#463

NTMA raises 1 billion euro with a ten year bond at a record low rate of interest.

What is this country going to be like in 2029 when these bonds fall due? Remember where we were in 2009?
Anyway the bond markets are full of confidence in us!

Why can’t I raise some cheap cash like this? I’m good for it and I’ll only take a million.

I would pay €3,000 interest every First of January on the nail for the next 10 years and, honest to God, I’d pay back that million in 2029, every last cent of it (assuming I can refinance it like the big boys).
https://www.irishtimes.com/business/economy/ntma-sells-1bn-in-bonds-at-a-third-of-the-interest-rate-set-in-january-1.3924455


#464

The falling due situation is far more manageable after 2020, The largest hump of debt falling due is next year and no particular year in the 2020s and 2030s is as high as 2019 and 2020 are. Some individual years in the 2020s are very low.

In 2009/10 we had a lot of 2 year and 5 year debt imminent, much like Italy today. I am surprised they only sold €1bn at that low rate, to be honest, but a least they now only have around 7 billion total they absolutely have to raise between now and the middle of 2021 (barring a serious recession which is also possible) and can use also ECB capital key rebalancing to help avoidthe debt markets while Brexit settles down as well as use the ECBs overall weight to keep the interest rates low during that time.

The world is very fuzzy from 2020 onwards though. :frowning:


#465

@2Pack The EBR of 2.3 Bn. comes from the 2019 Budget documentation.

Turning to 2019, an Exchequer Borrowing Requirement (EBR) of €2.3 billion is anticipated. The yearon-year widening of the 2019 EBR reflects inter alia the continued ramping-up of capital expenditure
under the National Development Plan 2018-2027 (NDP) and a €0.5 billion contribution from the
Exchequer to the Rainy Day Fund (RDF), albeit partially offset elsewhere on the Exchequer account.

So, the increase in capital expenditure will rely on Exchequer borrowing. I thought a Rainy Day Fund was about saving for bad times but it seems that we are borrowing for the rainy day!

http://www.budget.gov.ie/Budgets/2019/Documents/Budget_2019_Economic_and_Fiscal_Outlook_E.pdf