Following some interested, interesting, and inquiring tweets from Markham Nolan, Dr Kane clarified where the new exchequer numbers come from, and has given me permission to post his remarks here. Have a read, and get smarter:
***
Here's the low-down. Some basic cash accounting distinctions: some items are deficit-determining, some are deficit financing---also called 'above and below the line'.
Where you draw the line in any given case can be a matter of judgement/theory, but in the case of Irish exchequer accounts it's fairly straightforward.
To determine the deficit:
It's the difference between:
all expenditure voted+non-voted (other than repayment of debt) = to Nov 2008 €48.8bn and all revenue (tax and non-tax) (other than gross borrowing) = €40.9 bn
i.e. a deficit of € 7.9 bn in the year to November (put a minus sign if it helps, but it's usually clear from the context)
To finance this deficit (which appears in the accounts as 'sources and applications of funds)
The govt has gross borrowings of €28.1 bn (see detail on 2nd page of exchequer statement) but some €20.2 bn of that has gone to increasing money balances sitting in the govt's bank accounts, i.e. so that deficit financing is the again exactly the difference between the two aggregates: €7.9bn
The terminology I've used here is not quite precise (e.g. you'll see that some of the gross borrowings are in fact netted against relatively minor repayments of previous borrowings) but you get the basic idea from the above.
Looking at some www.ntma.ie stuff, would suggest that the debt managers have gone out of their way to (gross) borrow well in advance, perhaps not anticipating exactly what the outturn in borrowing will be, but at least making an attempt to secure funding for the next year or two (there are of course scheduled repayments of debt down the line).
That much is basic cash accounting. For the more interesting analytical stuff, there this book and some paper by the same authors.
And I think I have some related stuff at:
http://www.aidankane.net/
AK