COMMISSION STAFF WORKING DOCUMENT Assessment of the 2012 national reform programme and stability programme for IRELAND Accompanying the document Recommendation for a COUNCIL RECOMMENDATION on Ireland's 2012 national reform programme and delivering a Council opinion on Ireland's updated stability programme
Date: 2012-05-30
Institutions: European Commission
Subjects: Community loan, EU aid, Ireland, economic reform, economic stabilisation, financial aid, macroeconomics, reflation

EUROPEAN COMMISSION 

Brussels, 30.5.2012  
SWD(2012) 316 final 

COMMISSION STAFF WORKING DOCUMENT 

Assessment of the 2012 national reform programme and stability programme for 
IRELAND 

Accompanying the document 

Recommendation for a  

COUNCIL RECOMMENDATION 

on Ireland's 2012 national reform programme and delivering a Council opinion on 
Ireland's updated stability programme 

{COM(2012) 316 final} 

EN 

   EN 

 
 
 
 
  
 
 
CONTENTS 

Introduction  

Executive summary  ................................................................................................................... 3 
................................................................................... 4 
1. 
2.  Economic situation and outlook ........................................................................................ 5 
3.  Programme implementation  .............................................................................................. 5 
.................................................................................. 6 
4.  Conclusion  
............................................................................... 6 
5.  Annex  

 
 
 
EXECUTIVE SUMMARY 

Ireland’s  economy  returned  to  modest,  export-driven  growth  of  0.7 %  in  2011.  While 
employment contracted by 2.1% in 2011 as a whole, it grew by a seasonally adjusted 0.6% in 
the final quarter of 2011. Unemployment is expected to reach 14.3% in 2012. 

Ireland has agreed an Economic Adjustment Programme with the European Commission, the 
European  Central  Bank  and  the  International  Monetary  Fund  which  aims  at  restoring  the 
confidence  of  the  financial  markets  in  the  sustainability  of  public  finances  and  in  the  Irish 
banking sector, enabling a return to robust economic growth and market funding. 

Overall, Ireland has made important progress in programme implementation. The fiscal deficit 
target  for  2011  was  achieved  and  the  2012  budget  aims  for  a  fiscal  deficit  in  line  with  the 
programme. By 2015, Ireland plans to reach a deficit below 3 % of GDP. The recapitalisation 
of domestic banks has for the most part been completed. The deleveraging of domestic banks 
exceeded  the  programme’s  targets  for  2011.  Sheltered  sectors  of  the  economy  are  being 
opened  up  with  the  publication  of  several  reform  bills,  while  steps  are  being  taken  in  retail 
sector and to strengthen competition law enforcement. To address youth unemployment, the 
Irish authorities together with the Commission examined the possible measures for reducing 
youth unemployment, including through reallocation of the European Structural Funds.  

Beside  the  adverse  external  environment  and  in  particular  developments  in  the  euro  area, 
major short and medium-term risks relate to obstacles to bank deleveraging and funding to the 
complexity of the reorganisation of the financial sector; and to the fact that economic activity 
may prove weaker than anticipated, putting  pressure on the budget. 

 
 
1. 

INTRODUCTION 

Following  a  request  from  Ireland  on  21  November  2010,  a  comprehensive  financial 
assistance  package  was  agreed  at  staff  level  with  the  European  Commission  and  the 
International Monetary Fund (IMF), in liaison with the European Central Bank (ECB). 
The ECOFIN Council and the IMF Board approved the package in December 2010. The 
programme  covers  the  period  2010–13  and  includes  financing  for  a  total  amount  of 
EUR 85 billion. This includes contributions from the EU of EUR 45 billion, from the IMF of 
about EUR 22.5 billion and the use of Irish financial assets that amount to EUR 17.5 billion. 
The latter includes Treasury cash balances and assets of the National Pensions Reserve Fund. 
the  European  Financial  Stabilisation  Mechanism 
EU 
(EUR 22.5 billion), the European Financial Stability Facility (EUR 17.7 billion) and bilateral 
loans from the UK, Sweden and Denmark (which amount to a total of EUR 4.8 billion). IMF 
financing is provided on the basis of an arrangement under the Extended Fund Facility (EFF). 
By the end of April 2012, a total amount of EUR 47.8 billion has been disbursed, representing 
71% of the total international financial assistance of EUR 67.5 billion. 

financing 

comes 

from 

The  main  objective  of  the  accompanying  policy  programme  is  to  restore  confidence  of 
the  financial  markets  in  the  sustainability  of  public  finances  and  in  the  Irish  banking 
sector, enabling a return to robust economic growth and market funding. To achieve this 
goal, the programme includes commitments in three main areas: 

(1)   Reducing  the  government  deficit  to  below  3 %  of  GDP  by  2015.  This  is 
necessary  to  restore  the  sustainability  of  public  finances  and  reduce  government 
debt.  Progress  towards  this  target  would  also  enable  Ireland  to  return  to 
international  financial  markets.  The  consolidation  strategy  relies  on  expenditure 
consolidation and on broadening the tax base. 

(2)   Downsizing  and  reorganising 

the  banking  sector.  Recapitalising  and 
deleveraging the banking sector is necessary to restore its long-term viability and 
ensure  that  the  credit  channel  functions  properly,  while  at  the  same  time 
supporting 
the 
continuation of lending to support economic activity. 

the  orderly  adjustment  of  household  balance  sheets  and 

(3)   Implementing  a  structural  reform  package  to  underpin  growth  and  facilitate 
the  necessary  shift  of  production  capacity  towards  the  export  sector.  Reforms  to 
activation  and  unemployment  benefit  systems,  as  well  as  wage-setting 
mechanisms,  will  help  reduce  the  risk  of  long-term  unemployment,  support  job 
creation,  and  improve  competitiveness.  The  opening  up  of  sheltered  service 
sectors, including the legal and medical professions, is intended to lower relatively 
high prices. 

As  for  all  Member  States  benefiting  from  a  financial  assistance  package,  progress  in 
implementing the accompanying policy programme is monitored in a dedicated, regular 
and specific manner, in line with the provisions of the Memorandum of Understanding. 
Given the reporting requirements under financial assistance packages, as well as thorough and 
regular monitoring and the obligation to ensure compliance with agreed programme targets, 
programme  countries  have  been  exempted  from  the  obligation  to  submit  national  reform 
programmes  and  stability  or  convergence  programmes  in  2012.  Nonetheless,  Ireland 
submitted updated programmes in April 2012. This Staff Working Document under the 2012 
European  Semester  provides  a  synthesis  of  recent  progress  in  implementing  the  financial 

 
 
assistance programme. More details can be found in the reports on the state of implementation 
that the European Commission publishes after each quarterly programme review mission1. 

2. 

ECONOMIC SITUATION AND OUTLOOK 

Ireland’s  economy  returned  to  modest  growth  of  0.7 %  in  2011,  broadly  in  line  with 
expectations at the time the programme was negotiated. Growth was entirely export-led, 
thanks  to  improvements  in  competitiveness  and  solid  external  demand.  Net  exports 
contributed  4.7 percentage  points  to  GDP  growth,  while  domestic  demand  continued  to 
contract due to fiscal consolidation, falling employment and household balance sheet repair. 
Although  employment  contracted  by  2.1%  in  2011  as  a  whole,  it  grew  by  a  seasonally 
adjusted 0.6% in the final quarter of 2011. In 2012, growth is set to moderate to about 0.5 %, 
due  to  the  weaker  prospects  for  demand  in  Ireland’s  trading  partners  and  the  continuing 
adjustment of domestic demand. Household and corporate balance sheet repair will continue 
to weigh on consumption and investment in the medium term. While the broader employment 
situation  is  improving,  agreed  reductions  in  public  sector  employment  and  firm-specific 
developments in the financial sector will lead to a further employment contraction for 2012 as 
a whole. Export-driven growth is expected to pick up to 1.9 % in 2013 and to almost 3 % by 
2015 on the back of Ireland’s strong demographics, flexible labour market and considerable 
spare  capacity  in  the  economy.  This  should  lead  to  employment  growth  and  fall  in  the 
unemployment rate. 

3. 

PROGRAMME IMPLEMENTATION 

The  fiscal  deficit  target  for  2011  was  achieved.  The  headline  fiscal  deficit  was  13.1 %  of 
GDP in 2011, including deficit-increasing bank support measures of 3.7 % of GDP. Excluding 
these measures, the underlying deficit of 9.4 % of GDP was well below the programme ceiling 
of 10.6 %2. Fiscal performance in 2011 demonstrates the prudent design of the budget, strong 
revenue collection capacity, and careful expenditure control. The lower interest burden, due to 
the  reduction  in  EU  financing  costs  and  bank  recapitalisation  costs  that  were  lower  than 
expected, helped to compensate for lower growth and revenues. 

The  budget  for  2012  aims  for  a  fiscal  deficit  of  8.6 %  of  GDP,  in  line  with  the 
programme  ceiling.  The  total  consolidation  effort  amounts  to  2.7 %  of  GDP  split  equally 
between  expenditure-reducing  and  revenue-increasing  measures,  including  a  carryover  from 
the  revenue  measures  introduced  in  the  2011  budget.  On  the  revenue  side,  key  measures 
include an increase in the standard VAT rate of 2 percentage points to 23 %, an increase in 
capital taxes and the introduction of an annual household charge on primary residences as the 
first step toward a valuation-based property tax. On the expenditure side, the main savings are 
in the wage bill (by reducing the number of public service employees), social welfare and a 
range  of  other  current  expenditure  areas,  and  the  reprioritisation  and  reduction  of  capital 
spending. In the 2012 budget, the authorities increased the amount of consolidation to offset 
expected fiscal pressure due to the deterioration in the macroeconomic outlook at the end of 
2011. However, the stability programme update of April 2012 estimates a lower fiscal deficit 
of  8.3 %  of  GDP  in  2012  thanks  to  temporary  non-tax  revenue  higher  than  previously 
projected and lower interest expenditure. 

These reports, along with other information related to the financial assistance package, can be found on 

1  
http://ec.europa.eu/economy_finance/eu_borrower/ireland/index_en.htm. 
2  

The  direct  effect  of  bank  support  measures  is  excluded  from  the  headline  deficit  numbers,  as  far  as 
assessing compliance with the programme’s targets is concerned. 

 
 
                                                 
Medium-term  fiscal  consolidation  plans  are  consistent  with  the  programme’s  deficit 
ceilings and the goal of reaching a deficit below 3 % of GDP by 2015. The authorities have 
announced  the  overall  composition  of  revenue  and  expenditure  adjustments  until  2015.  The 
planned adjustment in revenue and capital expenditure is underpinned by broad measures, but 
not all adjustment  in current expenditure has been underpinned by explicit measures yet. In 
particular, binding ministerial expenditure ceilings until 2014 include both specified measures 
and adjustment needs that have not yet been addressed with specific policy actions, and the 
adjustment  for  2015  still  needs  to  be  detailed.  Good  progress  has  been  made  to  establish  a 
medium-term  budgetary  framework  and  multiannual  expenditure  ceilings  to  strengthen  the 
capacity to significantly reduce debt after 2013. The establishment in 2011 of the independent 
Irish Fiscal Advisory Council is welcome. The authorities have published draft legislation that 
gives a statutory basis to the Irish Fiscal Advisory Council and establishes national budgetary 
rules. 

The  recapitalisation  of  domestic  banks  envisaged  by  the  2011  Prudential  Capital 
Assessment  Review  of  the  Central  Bank  of  Ireland  has  for  the  most  part  been 
completed, with only EUR 1.3 billion remaining to be injected into Irish Life & Permanent 
(ILP) following the legal separation and acquisition by government of its life insurance assets. 
This is expected to  be  done  by  June  2012. The  budgetary costs are significantly lower than 
originally anticipated thanks to burden sharing with subordinated debt holders and a sizeable 
injection of private capital into Bank of Ireland, which is an important sign of the increasing 
confidence of investors in Ireland’s prospects. 

The  deleveraging  of  domestic  banks  exceeded  the  programme’s  targets  for  2011  as  a 
whole.  Looking  ahead,  challenging  market  conditions  and  the  deteriorating  quality  of 
remaining  assets  for  disposal  may  put  the  achievement  of  future  deleveraging  objectives  at 
risk. The reform of the regulatory and supervisory frameworks is also proceeding in line with 
programme targets. It is essential to further develop the financial sector strategy to underpin 
the viability of domestic banks, with a view to improving prospects for their timely return to 
market funding and, ultimately, private ownership. 

Structural  reforms  to  improve  competitiveness  and  create  more  jobs  are  significantly 
advanced.  Sheltered  sectors  of  the  economy  are  being  opened  up  with  the  publication  of 
several reform bills (in particular in relation to the legal and medical professions), while steps 
are being taken to raise caps on the size of retail premises and to strengthen the enforcement 
of competition law. Proposals have been drafted and discussed to introduce water charges by 
the  end  of  the  programme  period  and  to  better  target  social  support  expenditure.  Moreover, 
legislation has been passed to progressively increase the state pension age from 65 to 68 by 
2028. Work continues on the state-owned asset disposal programme with a view to enhancing 
the  efficiency  and  competitiveness  of  the  economy,  and  to  reducing  the  government’s 
financing needs. 

In  order  to  tackle  Ireland's  high  and  increasingly  structural  level  of  unemployment, 
measures designed to stimulate both labour demand and supply are being implemented. 
The 2012 update of the National Reform Programme refers to the February 2012 Action Plan 
for Jobs, which contains more than 275 distinct actions by a range of government department. 
The  plan  targets  the  addition  of  100 000  new  jobs  by  2016  and  to  have  2 million  people  in 
work by 2020. Ireland estimates that achieving this goal will bring to within the range of its 
EU  2020  employment  rate  target,  at  70.1%.  Draft  legislation  was  also  introduced  to  reform 
sectoral wage-setting arrangements in order to facilitate smoother labour market adjustment. 
On  the  supply  side,  the  government  has  outlined  reformed  to  its  activation  system  to  tackle 
unemployment.  In  February  2012  it  launched  'Pathways  to  Work',  its  policy  statement  on 
labour  market  activation.  It  sets  out  how  the  government  intends  to  introduce  a  better 

 
 
approach  to  providing  supports  for  the  unemployed,  including  more  regular  and  on-going 
engagement  with  people  who  are  unemployed;  greater  targeting  of  activation  places  and 
opportunities;  incentivising  the  take  up  of  opportunities;  incentivising  employers  to  provide 
more  jobs  for  people  who  are  unemployed;  and  reforming  institutions  to  deliver  better 
services. 

Addressing youth unemployment, which is high in Ireland, was identified as one of the 
main  priorities.  Following  the  European  Council  of  30  January  2012,  the  Irish  authorities 
and  the  Commission  examined  measures  for  reducing  youth  unemployment,  including 
through reallocation of the European Structural Funds. While all funds for Ireland are already 
committed,  some  resources  of  the  European  Social  Fund  (ESF)  have  been  shifted  towards 
education and training programmes for early school leavers (3 700 places on the Youth reach 
programme) and the new Education and Training Fund (6 500 places) will be co-financed by 
the ESF.  

The  crisis  has  adversely  affected  the  attainment  of  several  Europe  2020  targets.  The 
financial assistance package facilitates an orderly economic and fiscal adjustment process that 
ensures  a  return  to  sustainable  growth.  Structural  growth-enhancing  reforms  are  part  of  the 
programme,  but  progress  towards  achieving  Europe  2020  targets  is  constrained  by  fiscal 
adjustment needs. 

independent  review  of 

2011 commitments 
Euro Plus Pact (national commitments and progress)  
Fostering competitiveness: 
(i)  An 
the  Employment 
Regulation  Order  (ERO)  and  Registered  Employment 
Agreement (REA), 
(ii) A programme of state asset disposal, 
(iii)  Legislative  changes  to  remove  restrictions  in  the 
legal  and  pharmaceutical  professions  and  medical 
services. 

Fostering employment: 
(i)  A  50 %  reduction  until  the  end  of  2013  in 
employers’  social  insurance  contributions  for  low-
income earners (on a weekly wage of up to EUR 356), 
(ii)  A  capital  works  programme  focusing  on  ‘shovel-
ready’ labour-intensive projects, 
(iii)  A  large  increase  in  the  number  of  places  for  the 
unemployed  on  a  range  of  education  and  employment 
programmes, 
(iv) New taxation and sectoral measures to promote job 
creation. 

Summary assessment 

(i)  The  review  of  the  ERO  and  REA  was  carried  out 
and  published.  The  Industrial  Relations  (Amendment) 
Bill  was  published  in  the  first  quarter  of   2012  and  is 
set to be adopted later in the year. 
the  asset  disposal 
(ii)  The  shape  and  scale  of 
programme  has  been  agreed  between  the  government 
and  the  EU/IMF  programme  partners.  Specific  assets 
have been identified for disposal. 
(iii)  The  Legal  Services  Regulation  Bill  has  been 
published  and  is  expected  to  be  enacted  in  the  third 
quarter  of   2012.  Work  on  the  Health  (Provision  of 
General  Practitioner  Services)  Act  2012  began  in 
March. Regulations were enforced to reduce the mark-
up  to  20 %  on  pharmaceuticals  dispensed  under  the 
Community Drug Schemes. The retail mark-up on non-
drug items was also reduced to 20 %.  
 (i) This measure was implemented with effect from 1 
July  2011.  The  scheme  covers  the  first  18  months  of 
employment. 
(ii)  EUR 90 million  was  reprioritised  towards  labour-
intensive  capital  works 
in  2011.  The  capital 
programme  for  2012–2016  includes  funding  for  the 
construction  of  a  new  children’s  hospital,  40  new 
schools  and  the  expansion  and  renovation  of  180 
existing schools. 
(iii)  An  extra  20 900  training,  education  and  work 
placements  were  created  in  2011.  For  2012,  the 
government  is  committed  to  supporting  over  85 000 
beneficiaries  of  job  placement,  work  experience  and 
back-to-education schemes. 
(iv)  A  temporary  reduction  in  some  tourism-related 
VAT  rates  to  9 %  and  in  social  security  contributions 
on low wages from 1 July 2011 until the end of 2013. 
Measures  to  increase  the  availability  of  credit  for 

 
 
 
Improving the sustainability of public finances: 
(i) A comprehensive spending review will underpin the 
fiscal consolidation process, 
(ii) A Fiscal Advisory Council will be established, 
(iii)  Reform  of  the  budgetary  framework  by  way  of  a 
Fiscal Responsibility Bill, 
(iv)  Proactive  measures  to  reduce  long-term  pension 
liabilities through the Social Welfare and Pensions Bill, 
(v)  The  introduction  of  measures  to  broaden  the  tax 
base. 

the 

improving 

supervisory 

Reinforcing financial stability: 
(i)  Reforming  and 
framework for Irish banks, 
(ii)  The  radical  reorganisation  and  downsizing  of  the 
Irish  banking  system  to  better  serve  the  needs  of  the 
Irish economy, 
(iii)  Deleveraging  of  the  banking  system  to  reduce 
lending  in  areas  that  will  not  support  economic 
recovery  and  decrease 
the  system’s  reliance  on 
ECB/Central Bank funding, 
(iv)  Making  banks  profitable  again  by  rationalising 
their  cost  base  and  fully  recapitalising  them  based  on 
independent 
stringent  stress 
experts. 

tests  carried  out  by 

businesses include the establishment of a Microfinance 
Fund  worth  up  to  EUR 100 m,  the  establishment  of  a 
Temporary  Partial  Loan  Guarantee  Scheme,  and  a 
second call for tenders under Innovation Fund Ireland. 
 (i) The review was completed and it was published on 
5 December  2011.  It  identified  a  range  of  concrete 
options  for  savings  which  will  deliver  the  bulk  of 
consolidation over the medium term. 
(ii) The Irish Fiscal Advisory Council was established 
in  June  2011  on  a  non-statutory  basis.  Legislation  to 
put the Council on a statutory footing will be published 
soon. 
(iii) Draft legislation (the General Scheme of the Fiscal 
Responsibility  Bill)  was  published  in  April  2012.  It 
reflects  the    requirements  of  the  Treaty  on  Stability, 
Coordination  and  Governance  in  the  Economic  and 
Monetary  Union  and  helps  to  put  the  Irish  Fiscal 
Advisory  Council  on  a  statutory  footing.    A  separate 
piece  of  legislation  is  envisaged    later  in  2012, 
covering  the  remaining  aspects  of  the  budgetary 
framework, 
in  particular  multi-annual  expenditure 
ceilings. 
(iv)  Legislation  was  passed  to  progressively  increase 
the  state  pension  age  from  65  to  68  by  2028.  The 
parliament is still considering a public service pension 
reform bill for new entrants. 
(v)  The  2012  budget  introduced  measures  to  broaden 
the  tax  base,  including  changes  to  property-based 
‘legacy’  tax  relief,  betting  duty,  capital  taxes,  the 
domicile  levy  and  the  tax  treatment  of  certain  social 
welfare  benefits.  A  household  charge  has  also  been 
introduced. 
(i)  The  Central  Bank  (Supervision  and  Enforcement) 
Bill was published in October 2011. This Bill involves 
a careful overhaul of the statutory basis for the Central 
Bank’s regulatory powers. 
(ii)  The  strategy  for 
two  pillar  banks  was 
the 
announced on 31 March 2011. The two pillar banks — 
AIB and Bank of Ireland — have begun to reorganise 
their operations into core and non-core operations and 
to  implement  a  carefully  managed  programme  of 
deleveraging.  The  operations  of  AIB  and 
the 
Educational  Building  Society  (EBS)  were  merged  to 
create  a  second  pillar  bank  from  the  strengths  of  both 
institutions. The merger of Anglo Irish Bank and Irish 
Nationwide Building Society took place on 1 July 2011 
to  form  the  Irish  Banking  Resolution  Corporation 
(IBRC). 
their  2011 
two  pillar  banks  exceeded 
(iii)  The 
deleveraging  targets  and  their  reliance  on  Eurosystem 
funding  has  decreased.  They  are  set  to  deleverage  to 
loan-to-deposit ratios of 122.5 % by 2013. 
(iv)  By  the  end  of  2010,  the  government  had  injected 
EUR 46.3 billion into Irish banks. The 2011 Prudential 
Capital  Assessment  Review  (PCAR)  identified  an 
additional  capital  requirement  of  EUR 24 billion,  of 
which EUR 16.5 billion were covered by the state and 
the  rest  by  the  private  sector.  The  2011  PCAR 
recapitalisation  has  for  the  most  part  been  completed, 
with only EUR 1.3 billion remaining to be injected into 

 
 
Europe 2020 (national targets and progress) 
Employment rate target: between 69 % and 71 % 

R&D investment target: 2 % of GDP 

The  reduction  of  greenhouse  gas  (GHG)  emissions  in 
sectors  that  are  not  covered  by  the  Emission  Trading 
System by 20 % compared to 2005 levels 
Renewable energy target: 16 % of total energy use 

Energy  efficiency  —  reduction  in  primary  energy 
consumption  in  Million  tonnes  of  oil  equivalent 
(Mtoe): -2.75 

Early school leaving target: 8 % 

Tertiary education attainment target: 60 % 

To reduce the number experiencing consistent poverty 
to  4%  by  2016  (interim  target)  and  to  2%  or  less  by 
2020, from the 2010 baseline rate of 6.2%, which will 
lift  at  least  200,000  people  out  of  the  risk  of  poverty 
and exclusion between 2012 and 2020 (revised target). 

4. 

CONCLUSION 

Irish Life & Permanent.  

in 

The employment rate was 64.1 % in 2011. It has been 
falling since 2008 and is expected to continue falling in 
2012. 
Gross  domestic  expenditure  on  R&D  was  1.77 %  of 
GDP in 2010 (predominantly private sector R&D). The 
increase in the ratio plateaued in 2010.  
Greenhouse  gas  emissions  were  reduced  by  7.6 %  in 
2010.  Projected  reduction  of  0.1 %  by  2020,  based  on 
existing measures. 
Renewable  energy 
final  energy  consumption 
increased  from  5 %  in  2009  to  5.5 %  in  2010.  This 
figure is close to the 2011/2012 interim target. 
To achieve the EU 2020 target, Ireland should speed up 
the  removal  of  non-cost  barriers  to  the  large-scale 
development of both biomass and wind energy sources. 
It  should  ensure  that  additional  policies  for  offshore 
wind  projects  are  put  in  place  swiftly,  to  harness  the 
country’s rich resources and create an offshore industry 
sector in Ireland. 
n.a. 
The  energy  efficiency  objectives  are  set  according  to 
national  circumstances  and  national  formulations.  As 
the  methodology 
the  2020  energy 
to  express 
consumption  impact  of  these  objectives  in  the  same 
format  was  agreed  only  recently,  the  Commission  is 
not yet able to present an overview. 
The  percentage  of  early  leavers  from  education  and 
training  programmes  was  10.5 % 
in  2010.  The 
ambitious target, compared to other Member States, is 
attainable based on the current trend. 
Tertiary  education  attainment  reached  49.9 %  in  2010. 
Rates  have  been  steadily  increasing  over  the  last 
decade. 
The  number  of  people  in  consistent  poverty  increased 
from 186 000 to 277 000 in the period 2008–2010.  

Ireland  has  made  significant  progress  in  programme  implementation,  but  major 
challenges remain. All the programme’s conditions have been met, and available information 
suggests that the policy conditions associated with future reviews are also broadly on track to 
be  met.  Key  challenges  and  risks  in  the  period  ahead  relate  to  the  adverse  external 
environment  and  in  particular  the  risk  of  unfavourable  developments  in  the  euro  area; 
increasing  related  challenges  to  bank  deleveraging  and  funding;  the  complexity  of  the 
reorganisation  of  the  financial  sector;  and  possible  pressure  on  the  budget  should  economic 
activity  prove  weaker  than  anticipated.  To  minimise  vulnerability,  it  is  essential  that  the 
programme continue to be steadfastly implemented. 

 
 
5. 

ANNEX 

Table I. Macroeconomic indicators 

1995-
1999

2000-
2004

2005-
2008

2009

2010

2011

2012

2013

n.a
n.a
n.a
n.a
n.a

-0.7
30.2
-5.8
36.2
36.9
1.1

3.1
-82.0
-12.6
9.0
30.8

3.4
-92.4
-4.0
9.0
34.3

0.8
63.7
-34.4
37.7
36.9
3.9

-31.2
92.5
-48.7
35.6
66.8
3.1

-14.0
65.1
-27.2
34.8
48.8
2.0

1.4
32.9
-12.7
34.3
32.9
1.5

0.5
-1.2
1.7
-2.5
14.3
9.5
11.6

1.9
0.9
1.2
-0.3
13.6
9.5
13.1

9.9
2.3
2.2
8.8
9.4
20.1
22.7

3.2
1.5
2.7
3.9
5.0
25.3
21.0

5.7
1.9
4.1
5.2
4.3
22.7
22.1

-0.4
-4.9
-1.6
-4.9
13.7
11.5
11.6

0.7
-2.7
1.2
-3.0
14.4
10.1
10.5

-7.5
120.2
n.a
35.5
43.1
5.5

-8.3
116.1
n.a
35.8
44.1
4.0

-13.1
108.2
n.a
35.7
48.8
3.4

-7.0
-5.9
-1.7
-12.7
11.9
15.7
10.8

Core indicators
GDP growth rate
Output gap 1
HICP (annual % change)
Domestic demand (annual % change) 2
Unemployment rate (% of labour force) 3
Gross fixed capital formation (% of GDP)
Gross national saving (% of GDP)
General government (% of GDP)
Net lending (+) or net borrowing (-)
Gross debt
Net financial assets 
Total revenue 
Total expenditure
  of which: Interest
Corporations (% of GDP)
Net lending (+) or net borrowing (-)
Net financial assets, non-financial corporations
Net financial assets, financial corporations
Gross capital formation
Gross operating surplus
Households and NPISH (% of GDP)
Net lending (+) or net borrowing (-)
Net financial assets
Gross wages and salaries
Net property income
Current transfers received
Gross saving
Rest of the world (% of GDP)
Net lending (+) or net borrowing (-)
Net financial assets
Net exports of goods and services
Net primary income from the rest of the world
Net capital transactions 
Tradable sector
Non-tradable sector
  of which: Building and construction sector
Real effective exchange rate (index, 2000=100)
Terms of trade in goods and services (index, 2000=100)
Market performance of exports (index, 2000=100)
Notes:
1 The output gap constitutes the gap between actual and potential gross domestic product at 2000 market prices.
2 The indicator for domestic demand includes stocks.
3  Unemployed persons are all persons who were not employed, had actively sought work and were ready to begin working immediately or within two weeks. The 
labour force is the total number of people employed and unemployed. The unemployment rate covers the age group 15-74.
Source :
Commission spring 2012 forecast

0.4
19.7
15.3
-14.9
0.4
45.5
42.6
7.1
109.3
101.1
106.0

-4.4
37.3
9.8
-13.2
0.1
37.9
49.7
8.3
135.4
98.3
105.2

-3.7
112.3
15.5
-16.8
0.0
40.1
50.2
5.1
140.4
97.4
115.2

0.1
101.2
19.1
-17.1
0.0
39.7
49.6
5.0
126.7
96.2
111.2

-0.2
n.a
21.5
-19.9
0.0
n.a
n.a
n.a
120.4
93.4
111.6

2.9
n.a
12.2
-10.9
1.0
50.6
38.1
5.1
108.5
101.8
78.2

1.4
n.a
23.6
-21.3
-0.1
n.a
n.a
n.a
112.8
93.4
113.3

2.7
n.a
25.1
-21.7
-0.4
n.a
n.a
n.a
109.9
93.3
113.7

5.1
-128.9
-16.8
5.1
28.7

27.5
-124.6
-2.3
4.1
31.0

-6.6
88.7
35.8
1.9
13.9
3.7

-7.2
63.2
39.1
1.0
14.2
4.8

4.1
61.2
42.9
0.3
19.8
8.8

4.7
75.1
41.3
0.2
20.4
7.8

4.2
n.a
37.7
-1.7
18.9
6.0

4.1
n.a
39.9
-1.8
20.4
6.3

4.0
n.a
38.6
-2.5
20.3
5.7

5.6
n.a
n.a
4.8
30.8

6.0
n.a
n.a
5.7
32.8

5.8
n.a
n.a
5.3
32.1

n.a
n.a
n.a
n.a
n.a
n.a

 
 
 
 
 
 
Table II. Comparison of macroeconomic developments and forecasts 

Real GDP (% change)
Private consumption (% change)
Gross fixed capital formation (% change)
Exports of goods and services (% change)
Imports of goods and services (% change)
Contributions to real GDP growth:
- Final domestic demand
- Change in inventories
- Net exports
Output gap1
Employment (% change)
Unemployment rate (%)
Labour productivity (% change)
HICP inflation (%)
GDP deflator (% change)
Comp. of employees (per head, % change)
Net lending/borrowing vis-à-vis the rest of the 
world (% of GDP)

2011
COM SP
0.7
-2.7
-10.6
4.1
-0.7

0.7
-2.7
-10.6
4.1
-0.7

2012
COM SP
0.7
-1.7
-2.5
3.3
1.4

0.5
-1.7
-4.0
3.2
1.2

-3.3
0.9
4.7
-2.7
-2.1
14.4
2.8
1.2
-0.4
-1.4
-0.2

n.a.
n.a.
n.a.
-3.1
-2.1
14.4
2.9
1.1
-0.4
-1.0
0.1

-1.9
0.0
2.3
-1.2
-0.6
14.3
1.2
1.7
1.2
-0.8
1.4

-1.5
-0.1
2.3
-1.8
-0.4
14.3
1.1
1.8
0.9
0.4
1.1

2013

COM
1.9
0.3
1.0
4.2
3.0

-0.2
0.0
2.0
0.9
0.7
13.6
1.2
1.2
1.2
0.1
2.7

SP
2.2
0.0
1.5
4.3
2.6

-0.2
0.0
2.4
-0.4
0.8
13.6
1.4
1.3
1.0
1.0
2.2

2014
SP
3.0
1.0
3.8
4.8
3.4

0.5
0.0
2.4
0.9
1.3
12.8
1.6
1.5
1.3
1.4
3.2

2015
SP
3.0
1.2
4.5
4.8
3.5

0.7
0.0
2.3
1.7
1.6
11.7
1.5
1.8
1.4
1.9
3.7

Note:
1In per cent of potential GDP, with potential GDP growth according to the programme as recalculated by the Commission.

Source :
Commission spring 2012 forecasts (COM); Stability programme (SP).

 
 
 
 
Table III. Composition of the budgetary adjustment 

(% of GDP)

Revenue
of which:
- Taxes on production and imports
- Current taxes on income, wealth, etc.
- Social contributions
- Other (residual)
Expenditure
of which:
- Primary expenditure

of which:
Compensation of employees
Intermediate consumption
Social payments
Subsidies
Gross fixed capital formation
Other (residual)

2011

2012

2013

2014

2015

COM
35.7

COM
35.8

11.5
11.7
6.6
5.8
48.8

45.4

11.5
12.4
6.3
5.5
44.1

40.0

SP
35.8

11.6
12.5
6.2
5.5
44.1

40.0

COM
35.5

11.6
12.6
6.2
5.1
43.1

37.6

SP
35.9

11.7
13.1
6.1
5.0
43.5

37.9

SP
36.1

11.5
13.8
6.0
4.8
40.8

35.3

SP
36.0

11.2
14.4
5.8
4.6
38.8

33.2

Change: 
2011-2015

SP
0.3

-0.3
2.7
-0.8
-1.2
-10.0

-12.2

-1.7
-1.4
-3.3
-0.1
-1.3
-4.3
2.2
10.3
12.5
3.6
6.7

11.4
5.6
17.8
0.4
3.3
6.9
3.4
-13.1
-9.7
-3.6
-9.5

11.1
5.5
17.4
0.4
2.7
3.0
4.0
-8.3
-4.3
0.3
-8.6

11.5
5.2
17.3
0.4
2.5
3.1
4.1
-8.3
-4.2
0.3
-8.6

10.6
5.0
16.1
0.4
2.3
3.2
5.5
-7.5
-2.0
0.0
-7.5

10.9
4.9
16.5
0.4
2.3
2.9
5.6
-7.5
-1.9
0.0
-7.5

10.3
4.5
15.3
0.3
2.1
2.7
5.5
-4.8
0.8
0.0
-4.8

9.7
4.2
14.5
0.3
2.0
2.6
5.6
-2.8
2.8
0.0
-2.8

8.5

0.9

4.4

4.9

0.9

1.7

-1.8

-3.5

-7.4

-7.6

-0.4

-7.9

-7.8

-1.2

-5.2

-2.7

-4.9

-8.4

-12.0

-3.8
1.2

-1.8
2.0

-4.1
0.9

-2.4
1.7

-5.2
2.2

-8.1
0.3

-7.4
0.5

-7.9
0.2

-3.5
1.7

-7.9
0.5

- Interest expenditure
General government balance (GGB)
Primary balance
One-off and other temporary measures
GGB excl. one-offs
Output gap2
Cyclically adjusted balance2
Structural balance3
Change in structural balance
Structural primary balance3
Change in structural primary balance
Expenditure benchmark
Public expenditure growth4 (real)
Reference rate5,6
Lower reference rate5,7
Deviation in % of GDP 
   from applicable reference rate
Two-year average deviation in % of GDP 
   from applicable reference rate
Notes:
1On a no-policy-change basis.
2Output gap (in % of potential GDP) and cyclically adjusted balance according to the programme as recalculated by the Commission on the basis of 
the information in the programme.
3Structural (primary) balance = cyclically adjusted (primary) balance excluding one-off and other temporary measures.
4Modified expenditure aggregate used for the expenditure benchmark, growth rates net of non-discretionary changes in unemployment benefit and of 
discretionary measures.
5The reference rates applicable to 2014 onwards will be available from mid-2012. For illustrative purposes, the current reference rates have also been 
applied to the years 2014 onwards.
6The (standard) reference rate applies starting in the year following the one in which the country reaches its MTO.
7The lower reference rate applies as long as the country is adjusting towards its MTO, including the year in which it reaches the MTO.

-0.83
-1.98

-0.83
-1.29

-0.83
-1.76

-0.83
-5.87

-0.83
-5.77

-0.83
-2.07

2.1
1.8

0.3
2.1

-13.42

-13.61

-1.87

-1.63

-5.27

-4.58

-3.77

-3.97

-6.02

-6.15

0.43

0.43

0.43

0.43

0.43

0.43

n.a.

n.a.

7.1

-
-

-

-

-

Source :
Stability programme (SP); Commission spring 2012 forecasts (COM); Commission calculations.

 
 
 
 
Table IV. Debt dynamics 

Average 
2006-10
50.3
13.1

2011

108.2
15.7

8.2
2.7

1.7
0.4
0.6
2.2

9.7
3.2

3.4
-0.6
0.4
2.9

2012

2013

COM
116.1
7.9

4.3
2.1

4.0
-0.6
-1.3
1.5

SP
117.5
9.3

4.2
2.4

4.1
-0.7
-1.0
2.7

COM
120.2
4.1

2.0
2.0

5.5
-2.1
-1.4
0.1

SP
120.3
2.8

1.9
1.9

5.6
-2.5
-1.2
-0.9

2014
SP
119.5
-0.8

-0.8
0.7

5.6
-3.5
-1.5
-0.6

2015
SP
117.4
-2.1

-2.8
0.5

5.6
-3.4
-1.7
0.2

(% of GDP)

Gross debt ratio1
Change in the ratio
Contributions 2 :

1. Primary balance
2. ‘Snow-ball’ effect

Of which:
Interest expenditure
Growth effect
Inflation effect

3. Stock-flow adjustment

Of which:
Cash/accruals diff.
Accum. financial assets

Privatisation

Val. & residual effects

(% of GDP)

2011

2012

2013

COM/SP3

SP4

COM/SP3

SP4

2014
SP4

2015
SP4

Gap to the debt benchmark5,6

Structural adjustment7

To be compared to:
Required adjustment8

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Notes:
1End of period.
2The snowball effect captures the impact of interest expenditure on accumulated debt, as well as the impact of real GDP growth and inflation on 
the debt ratio (through the denominator). The stock-flow adjustment includes differences in cash and accrual accounting, the accumulation of 
financial assets, and valuation and other residual effects. 

3Assessment of the consolidation pat set in the SP assuming growth follows the COM forecasts.
4Assessment of the consolidation pat set in the SP assuming growth follows the SP projections.
5 Not relevant during the excessive deficit procedures that were ongoing in November 2011 and in the three years following the correction of 
the excessive deficit.

6Shows the difference between the debt-to-GDP ratio and the debt benchmark. If positive, projected gross debt-to-GDP ratio does not comply 
with the debt reduction benchmark.

7Applicable only during the transition period of three years from the correction of the excessive deficit for excessive deficit procedures that 
were ongoing in November 2011.
8Defines the remaining annual structural adjustment over the transition period which ensures that - if followed – Member State will comply 
with the debt reduction benchmark at the end of the transition period, assuming that the COM (SP) budgetary projections are achieved.

Source :
Stability programme (SP); Commission spring 2012 forecasts (COM); Commission calculations.

 
 
 
 
 
Table V. Long-term sustainability indicators 

S2
of which:

Initial budgetary position (IBP)
Long-term change in the primary balance (LTC)
 of which:
Pension
Care (HC and LTC)
Others

S1 (required adjustment)*

Debt,  % of GDP (2011)
Age-related expenditure, % of GDP (2011)
Notes:

IE

EU27

No policy 
change 
scenario 

Stability 
programme 
scenario

No policy 
change 
scenario 

SCPs scenario

6.7

3.3
3.4

3.1
2.2
-1.9
10.3

2.7

0.1
2.6

2.9
2.3
-2.5
3.0

2.9

0.7
2.3

1.1
1.5
-0.3
2.2

0.7

-1.6
2.4

1.2
1.5
-0.3
-0.1

108.2
26.0

82.8
25.8

The ‘no policy change’ scenario depicts the sustainability gap under the assumption that the budgetary position evolves according to 
the spring 2012 forecast until 2013. The ‘stability programme’ scenario depicts the sustainability gap under the assumption that the 
budgetary plans in the programme are fully implemented. 

* The required adjustment of the primary balance until 2020 to reach a public debt of 60% of GDP by 2030.

Source : Commission, 2012 stability and convergence programmes

Figure. Medium-term debt projection 

(% of GDP)

Gross debt as % of GDP - IE - Medium term debt projections

180

160

140

120

100

80

60

40

20

0

0
0
0
2

2
0
0
2

4
0
0
2

6
0
0
2

8
0
0
2

0
1
0
2

2
1
0
2

4
1
0
2

6
1
0
2

8
1
0
2

0
2
0
2

COM no-policy change scenario
COM + Shock ( -1p.p. in the short-term/long-term interest rate on maturing and new debt from 2014)
COM + Shock (+1p.p. in the short-term/long-term interest rate on maturing and new debt from 2014)
COM consolidation scenario (0.5% per year on SB) in order to achieve MTO
COM consolidation scenario (1% per year on SB) in order to achieve MTO
SP scenario

 
 
 
 
 
 
 
Table VI. Taxation 

Total tax revenues (incl. actual compulsory social contributions, % of GDP)
Breakdown by economic function (% of GDP)1
     Consumption
              of which:
              - VAT
             - excise duties on tobacco and alcohol
             - energy
             - other (residual)
     Labour employed
     Labour non-employed
     Capital and business income
     Stocks of capital/wealth
     p.m.  Environmental taxes2
VAT efficiency3
     Actual VAT revenues as % of theoretical revenues at standard rate

2001

29.5

2005

30.5

2007

31.3

2008

29.6

2009

28.2

2010

28.2

10.8

11.4

6.8
1.7
1.2
1.2
10.8
0.1
5.8
2.0
2.3

7.6
1.3
1.3
1.2
10.2
0.1
6.2
2.7
2.5

11.2

7.5
1.2
1.2
1.2
10.7
0.1
6.6
2.8
2.5

10.9

7.3
1.2
1.3
1.1
11.2
0.1
5.2
2.2
2.5

10.0

6.4
1.4
1.5
0.8
11.7
0.1
4.4
2.0
2.4

10.0

6.4
1.3
1.5
0.8
11.6
0.1
4.3
2.2
2.4

60.6

66.1

63.2

55.4

46.5

48.5

Note: 
1 Tax revenues are broken down by economic function, i.e. according to whether taxes are raised on consumption, labour or capital. See European Commission (2012), Taxation trends in the 

European Union, for a more detailed explanation.

2 This category comprises taxes on energy, transport and pollution and resources included in taxes on consumption and capital.

3 The VAT efficiency is measured via the VAT revenue ratio. The VAT revenue ratio is defined as the ratio between the actual VAT revenue collected and the revenue that would theoretically be 

raised if VAT was applied at the standard rate to all final consumption. A low ratio can indicate a reduction of the tax base due to large exemptions or the application of reduced rates to a wide range 

of goods and services ('policy gap') or a failure to collect all tax due to e.g. fraud ('collection gap'). See European Commission (2011), Tax reforms in EU Member States, European Economy 5/2011, 

for a more detailed explanation.

Source: Commission

 
 
 
 
 
Table VII. Financial market indicators 

2007

2008

2009

2010

2011

962.0
55.3
55.8

875.8
50.4
58.7

978.9
56.8
…

1017.5
58.8
49.9

2.6
10.6
-8.0
1.4
-6.9
179.0
5.6
6.1
…

0.8
10.7
16.4
20.7
11.4
181.1
2.5
6.0
…

Total assets of the banking sector (% of GDP)
Share of assets of the five largest banks (% of total assets)
Foreign ownership of banking system (% of total assets)
Financial soundness indicators:
              - non-performing loans (% of total loans) 1)
              - capital adequacy ratio (%) 2)
              - return on equity (%) 1), 3)
Bank loans to the private sector (year-on-year % change)
Lending for house purchase (year-on-year % change)
Loan to deposit ratio
CB liquidity as % of liabilities
Banks' exposure to countries receiving official financial assistance  (% of GDP)4)
Private debt (% of GDP)
Gross external debt (% of GDP) 5)
            - Public
            - Private
Long term interest rates spread versus Bund (basis points)*
Credit default swap spreads for sovereign securities (5-year)*
Notes: 
1) All licensed banks. Latest June 2011.
2) The capital adequacy ratio is defined as total capital divided by risk weighted assets.   
3) Net income to equity ratio.  Latest June 2011.
4) Covered countries are IE, EL, PT, RO, LV and HU. 
5) Latest data 2011Q3.
* Measured in basis points.
Source :
Bank for International Settlements and Eurostat (exposure to macro-financially vulnerable countries), IMF (financial soundness indicators), 
Commission (long-term interest rates), World Bank (gross external debt) and ECB (all other indicators).

8.6
14.6
-66.5
-12.6
-2.5
140.8
9.3
1.6
182.8

9.0
10.9
-40.6
-5.6
-4.1
162.0
6.0
5.7
222.1

50.8
668.0
299.6
299.6

45.6
525.4
200.3
202.1

16.1
391.5
8.9
…

33.9
482.6
54.2
89.2

840.9
…
…

14.1
10.3
-8.6
-4.7
-0.9
133.4
9.1
1.2
168.6

62.5
650.8
699.3
734.7

 
 
 
 
 
 
Table VIII. Labour market and social indicators 

Labour market indicators
Employment rate 
(% of population aged 20-64)
Employment growth 
(% change from previous year)
Employment rate of women 
(% of female population aged 20-64)
Employment rate of men 
(% of male population aged 20-64)
Employment rate of older workers 
(% of population aged 55-64)
Part-time employment 
(% of total employment)
Part-time employment of women  
(% of women employment)
Part-time employment of men  
(% of men employment)
Fixed term employment 
(% of employees with a fixed term contract)
Unemployment rate1 (% of labour force)
Long-term unemployment2  (% of labour force)
Youth unemployment rate 
(% of youth labour force aged 15-24)

2006

2007

2008

2009

2010

2011

73.4

73.8

72.3

67.1

65.0

64.1

4.7

3.6

-0.7

-8.2

-4.2

-2.1

63.3

64.4

64.1

61.9

60.5

59.7

83.4

83.0

80.4

72.4

69.5

68.6

53.1

53.8

53.7

51.3

50.2

50.0

17.3

18.1

19.0

21.8

23.0

24.1

31.5

32.3

32.8

34.4

35.3

36.2

11.0

12.2

13.3

6.8

6.0

4.5

1.4

8.6

7.2

8.1

4.6

1.3

8.9

8.0

8.5

6.3

1.7

13.3

8.6

11.9

3.5

24.4

9.4

13.7

6.7

27.8

Youth NEET3 rate (% of population aged 15-24)

10.1

10.7

14.8

18.5

18.9

Early leavers from education and training (% of 
pop. 18-24 with at most lower sec. educ. and not in 
further education or training)
Tertiary educational attainment (% of population 
30-34 having successfully completed tertiary 
education)
Labour productivity per person employed (annual 
% change )
Hours worked per person employed  (annual % 
change)
Labour productivity per hour worked (annual % 
change; constant prices)
Compensation per employee (annual % change; 
constant prices)
Nominal unit labour cost growth (annual % 
change)

Real unit labour cost growth (annual % change)

Notes:

12.1

11.6

11.3

11.3

10.5

42.5

44.1

45.1

47.5

48.1

0.9

-0.2

1.1

1.4

4.0

0.5

1.5

-0.7

2.2

4.5

4.3

2.9

-1.9

-1.1

-0.8

8.0

7.5

10.1

1.2

-2.0

3.3

3.0

-2.4

1.7

4.0

-0.2

4.2

-0.8

-6.9

-4.6

1 According to ILO definition, age group 15-74)
2 Share of persons in the labour force who have been unemployed for at least 12 months.
3 NEET are persons that are neither in employment nor in any education or training.

Sources: 
Commission (EU Labour Force Survey and European National Accounts) 

9.9

14.4

8.6

29.4

:

:

:

3.2

-0.1

3.3

0.8

-2.9

-2.1

 
 
 
 
 
Table VIII. Labour market and social indicators (continued) 

Expenditure on social protection 
benefits (% of GDP)
Sickness/Health care
Invalidity
Old age and survivors
Family/Children
Unemployment
Housing and Social exclusion n.e.c.
Total
of which:  Means tested benefits
Social inclusion indicators
Risk-of-poverty or exclusion1 (% of total 
population)
Risk-of-poverty or exclusion of children (% of 
people aged 0-17)
Risk-of-poverty or exclusion of elderly (% of 
people aged 65+)
At-risk-of-poverty rate2 (% of total population)
Value of relative poverty threshold (single 
household per year) - in PPS
Severe material deprivation3  (% of total 
population)

Share of people living in low work intensity 
households4 (% of people aged 0-59 not student)

In-work at-risk-of poverty rate (% of persons 
employed)

Notes:

2005

2006

2007

2008

2009

6.86
0.88
3.71
2.45
1.25
0.35
17.9
4.04
2006

6.95
0.90
3.82
2.48
1.28
0.34
18.2
4.13
2007

7.20
0.96
3.92
2.58
1.36
0.34
18.8
4.34
2008

8.46
1.14
4.54
3.08
1.80
0.41
22.0
5.25
2009

10.72
1.35
5.57
3.66
3.08
0.35
27.9
6.71
2010

23.3

23.1

23.7

25.7

29.9

28.0

26.2

26.6

31.4

37.6

27.7

18.5

28.7

17.2

22.5

15.5

17.9

15.0

12.9

16.1

9563

10633

10901

10556

9707

4.8

4.5

5.5

6.1

7.5

12.8

14.2

13.6

19.8

22.9

6.2

5.6

6.5

5.4

7.6

1 People at risk of poverty or social exclusion (AROPE): individuals who are at risk of poverty (AROP) and/or 
suffering from severe material deprivation (SMD) and/or living in households with zero or very low work intensity 
(LWI).

2 At-risk-of poverty rate: share of people with an equivalised disposable income below 60% of the national 
equivalised median income. 

3 Share of people who experience at least 4 out of 9 deprivations: people cannot afford to i) pay their rent or utility 
bills, ii) keep their home adequately warm, iii) face unexpected expenses, iv) eat meat, fish, or a protein equivalent 
every second day, v) enjoy a week of holiday away from home once a year, vi) have a car, vii) have a washing 
machine, viii) have a colour TV, or ix) have a telephone.

4 People living in households with very low work intensity: share of people aged 0-59 living in households where 
the adults work less than 20% of their total work-time potential during the previous 12 months.
Sources: 
For expenditure on social protection benefits ESSPROS; for social inclusion EU-SILC.

 
 
 
 
 
Table IX. Product market performance and policy indicators 

Performance indicators

Labour productivity1 total economy (annual growth 
in %)
Labour productivity1 in manufacturing (annual 
growth in %)
Labour productivity1 in electricity, gas, water (annual 
growth in %)
Labour productivity1 in the construction sector 
(annual growth in %)
Patent intensity in manufacturing2 (patents of the 
EPO divided by gross value added of the sector)

2002-
2006

1.8

5.6

2007

2008

2009

2010

2011

1.5

9.9

-2.0

1.3

3.9

2.2

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

-2.3

-1.8

0.7

0.8

1.5

0.7

1.4

-11.0

n.a.

n.a.

n.a.

n.a.

Policy indicators

Enforcing contracts3 (days)
Time to start a business3 (days)
R&D expenditure (% of GDP)
Tertiary educational attainment 
(% of 30-34 years old population)
Total public expenditure on education 
(% of GDP)

2002-
2006
n.a.

n.a.
1.2

37.2

2007

2008

2009

2010

2011

515

13
1.3

43.3

515

13
1.5

46.1

515

13
1.7

49.0

515

13
1.8

49.9

4.6

4.9

5.6

n.a.

n.a.

650

13
n.a.

n.a.

n.a.

Product market regulation4, Overall
(Index; 0=not regulated; 6=most regulated)
Product market regulation4, Retail
(Index; 0=not regulated; 6=most regulated)
Product market regulation4, Network Industries5
(Index; 0=not regulated; 6=most regulated)

2005

2006

2008

2009

2010

2011

n.a.

n.a.

n.a.

n.a.

0.9

1.0

n.a.

n.a.

n.a.

n.a.

n.a.

n.a.

3.1

2.8

2.6*

n.a.

n.a.

n.a.

Notes:
1Labour productivity is defined as gross value added (in constant prices) divided by the number of persons employed.
2 Patent data refer to applications to the European Patent Office (EPO). They are counted according to the year in which they were 
filed at the EPO. They are broken down according to the inventor's place of residence, using fractional counting if multiple 
inventors or IPC classes are provided to avoid double counting. 
3 The methodologies, including the assumptions, for this indicator are presented in detail on the website 
http://www.doingbusiness.org/methodology. 
4 The methodologies for the product market regulation indicators are presented in detail on the website 
http://www.oecd.org/document/1/0,3746,en_2649_34323_2367297_1_1_1_1,00.html. The latest available product market 
regulation indicators refer to 2003 and 2008, except for Network Industries.
5 Aggregate ETCR.
*figure for 2007.

Source :

Commission, World Bank - Doing Business  (for enforcing contracts and time to start a business) and OECD (for the product 
market regulation indicators). 

 
 
 
 
 
 
Table X. Indicators on green growth 

Ireland

Green Growth performance

Macroeconomic
Energy intensity 
Carbon intensity 
Resource intensity (reciprocal of resource productivity)
Waste intensity 
Energy balance of trade 
Energy weight in HICP
Difference between change energy price and inflation 
Environmental taxes over labour taxes
Environmental taxes over total taxes

Sectoral 

Industry energy intensity 
Share of energy-intensive industries in the economy
Electricity prices for medium-sized industrial users 
Public R&D for energy 
Public R&D for the environment
Recycling rate of municipal waste
Share of GHG emissions covered by ETS
Transport energy intensity
Transport carbon intensity
Change in the ratio of passenger transport and GDP

Security of energy supply
Energy import dependency
Diversification of oil import sources 
Diversification of energy mix
Share of renewable energy in energy mix

2001-
2005

0.12
0.56
1.52
n.a.
-1.5%
8
3.62
23.5%
8.2%

0.07
17.4
0.08
n.a.
n.a.
22.8%
n.a.
0.70
1.83
-2.9%

89.6%
n.a.
0.40
1.8%

2006

2007

2008

2009

2010

0.11
0.48
1.55
0.21
-2.1%
9
6.9
23.9%
7.7%

0.08
12.8
0.10
0.01%
0.00%
33.1%
31.6%
0.69
1.76
-1.7%

90.7%
0.74
0.39
2.7%

0.11
0.46
1.55
0.18
-2.5%
9
4.6
23.0%
7.9%

0.07
13.8
0.11
0.01%
0.01%
34.1%
31.2%
0.69
1.71
-0.6%

88.2%
0.41
0.39
2.9%

0.11
0.47
1.60
0.16
-3.2%
9
5.6
22.2%
8.4%

0.07
14.0
0.13
0.02%
0.01%
36.5%
30.1%
0.68
1.77
5.3%

89.9%
0.43
0.38
3.5%

0.11
0.46
1.66
n.a.
-2.4%
9
-4.1
20.1%
8.4%

0.06
16.0
0.12
0.02%
0.01%
35.4%
27.6%
0.60
1.67
n.a.

88.0%
0.26
0.37
4.3%

0.11
n.a.
n.a.
n.a.
-3.1%
9
3.3
n.a.
n.a.

n.a.
n.a.
0.11
n.a.
n.a.
n.a.
n.a.

n.a.
n.a.

n.a.

n.a.
n.a.
n.a.
n.a.

kgoe / €
kg / €
kg / €
kg / €
% GDP
%
%
ratio
ratio

kgoe / € 
% GDP
€ / kWh
% GDP
% GDP
ratio
%
kgoe / €
kg / €
%

%
HHI
HHI
%

Country-specific notes: 
The year 2011 is not included in the table due to lack of data.
General explanation of the table items:
Source: Eurostat unless indicated otherwise; ECFIN explanations given below
All macro intensity indicators are expressed as a ratio of a physical quantity to GDP (in 2000 prices)
          Energy intensity: gross inland energy consumption (in kgoe) divided by GDP (in EUR)
          Carbon intensity: Greenhouse gas emissions (in kg CO2 equivalents) divided by GDP (in EUR)
          Resource intensity: Domestic Material Consumption (in kg) divided by GDP (in EUR)
          Waste intensity: waste (in kg) divided by GDP (in EUR)
Energy balance of trade: the balance of energy exports and imports, expressed as % of GDP  
Energy weight in HICP: the share of the "energy" items in the consumption basket used in the construction of the HICP
Difference between energy price change and inflation: energy component of HICP, and total HICP inflation (annual %-change)
Environmental taxes over labour or total taxes: from DG TAXUD's database "Taxation trends in the European Union"
Industry energy intensity: final energy consumption of industry (in kgoe) divided by gross value added of industry (in EUR) 
Share of energy-intensive industries in the economy: share of gross value added of the energy-intensive industries in GDP
Recycling rate of municipal waste: ratio of municipal waste recycled over total municipal waste
Public R&D for energy or for the environment: government spending on R&D (GBAORD) for these categories as % of GDP
Share of GHG emissions covered by ETS: based on greenhouse gas emissions as reported by Member States to EEA (excl LULUCF)
Transport energy intensity: final energy consumption of transport (in kgoe) divided by gross value added of industry (in EUR) 
Transport carbon intensity:  greenhouse gas emissions in transport divided by gross value added of the transport sector
Passenger transport growth : measured in %-change in passenger kilometres
Energy import dependency: net energy imports divided by gross inland energy consumption incl. of international bunkers
Diversification of oil import sources: Herfindahl index (HHI), calculated as the sum of the squared market shares of countries of origin 

Diversification of the energy mix: Herfindahl Index over natural gas, total petrol products, nuclear heat, renewable energies and solid fuels

Share of renewable energy in energy mix: percentage-share in  gross inland energy consumption, expressed in tonne oil equivalents