The latest Exchequer returns show a deficit of €3.9 billion for the first three months of 2010, compared with €3.7 billion for the same period a year earlier.
This is broadly in line with expectations the Minister for Finance Brian Lenihan said today.
Tax receipts for the first quarter of the year, at €7.2 million, was €266 million or 3.5 per cent behind expectations and 15 per cent lower than what was collected for the same three-months in 2009.
"A substantial year-on-year decline had been anticipated in the early stages of 2010 and for the year as a whole, the Budget day forecast of €31 billion, which represents a 6 per cent year-on-year decline, is still a valid target," said Minister for Finance Brian Lenihan in a statement.
Net voted expenditure was €10.7 billion was €225 million or 2 per cent less than expected and down €1 billion year-on-year from , leaving the overall Exchequer balance generally in line with expectations.
The Revised Estimates Volume, published on February 18th had projected an overall reduction in total net voted spending in 2010 of 1.9 per cent.
Net voted current expenditure fell from €10.3 billion in the first quarter of 2009 to €9.7 billion in the first three months of this year, a €6.19 million decrease. Net voted current expenditure was down €115 million or 1.2 per cent lower than expected.
The latest returns also indicate that net voted capital expenditure declined from €1.4 billion to €1.02 billion year-on-year, a €465 million decrease. Expenditure was down €110 million or 9.7 per cent than forecast.
"In overall terms it is clear that the budgetary policy decisions taken by the Government in recent months are having the intended impact on the public finances and will aid in the restoration of much needed confidence in Ireland," said Mr Lenihan.
"In terms of international confidence, this is most clearly seen in the cost that Ireland has to pay to borrow – the premium, or spread, over Germany which Ireland pays on its bonds is now about half the rate it was this time last year,” he added.
The Labour Party's spokeswoman on finance Joan Burton said the latest figures "made for grim reading."
"There are really no signs in these figures of the promised economic uplift. The key taxes we need to run the public services are Income tax and VAT and both of these continue to show an economy that remains in the doldrums at the end of the first quarter of 2010," she said.
"Should the trend shown today remain in place by the end of the April to June quarter then the Minister is going to have to seriously reconsider the damage caused by a wholly deflationary economic strategy that makes people fearful of spending," Ms Burton added.
