OCDE - OECD review of the Irish Fiscal Advisory Council 2026 de 2026

OECD Papers on Budgeting OECD review of the Irish Fiscal Advisory Council 2026

Volume 2026/062  OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

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OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

This second OECD review assesses the Irish Fiscal Advisory Council and progress made since the 2021 OECD review. It examines how the Council continues to perform against international standards, and considers how it can remain effective in light of evolving fiscal and institutional challenges.

Keywords: Independent fiscal institution (IFI); Ireland; fiscal council; oversight; fiscal governance; publi c financial accountability

JEL codes: H11; H6; H60; H61; H68; H83

This paper is part of the series “OECD Papers on Budgeting”, https://doi.org/10.1787/cc8869fa-en. Contact Scherie NICOL ( scherie.nicol@oecd.org).

Abstract4  OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

This OECD Review was prepared by the Public Governance Directorate (GOV) of the OECD unde r the leadership of Elsa Pilichowski, Director for Public Governance, and overall s upervision of Jón Blöndal, Head of Public Management and Budgeting Division (PMB). The Review was authored by Scherie Nicol

This OECD Review was prepared by the Public Governance Directorate (GOV) of the OECD unde r the leadership of Elsa Pilichowski, Director for Public Governance, and overall s upervision of Jón Blöndal, Head of Public Management and Budgeting Division (PMB). The Review was authored by Scherie Nicol (Lead – Independent Fiscal Institutions) and Kaitlyn Vanderwees (Policy Analyst), both of PMB, as well as international peer Lucia Rodriguez Muñoz (Member of the European Fiscal Board and Member of the Governing Council and Executive Commission at Bank of Spain). The OECD appreciate the views and support of the Irish Fiscal Advisory Council throughout the Review process, including Seamus Coffey (Chair of the Council) and Niall Conroy (Actin g Chief Economist and Head of the Secretariat) as well as the views of external stakeholders in Ireland who provided input. The OECD is also grateful for the valuable feedback received on the draft report , including from Janos Bertok, Deputy Director for Public Governance at the OECD as well as Muge Adalet McGowan and Patrizio Sicari from the Ireland Country Desk in the OECD’s Economics Department . The draft report also benefited from feedback from the OECD’s Committee of Senior Budget Officials and the Worki ng Party on Parliamentary Budget Officials and Independent Fiscal Institutions. Corey Stenhouse provided logistical support, and Meral Gedik provided publication support.

Acknowledgements 5

OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

Table of contents Disclaimers 2 Abstract 3 Acknowledgements 4 Abbreviations and acronyms 6 Executive summary 7 1 Progress since the 2021 OECD Review 9 1.1. About the Council 9 1.2. Context of current review 10 1.3. Progress in relation to recommendations in the 2021 Review 11 2 The evolving domestic and international context 17 2.1. Domestic fiscal context 17

1.1. About the Council 9 1.2. Context of current review 10 1.3. Progress in relation to recommendations in the 2021 Review 11 2 The evolving domestic and international context 17 2.1. Domestic fiscal context 17 2.2. EU fiscal reforms and their implications for Ireland 18 2.3. Implications of evolving domestic and international context for the Council’s role 19 3 Impact of the Council 24 3.1. Overall impact and visibility 24 3.2. Influence on fiscal policy and public debate 27 3.3. Strengthening impact: future direction 30 4 Conclusion 33 Annex A. Stakeholders consulted 34 References 35

FIGURES Figure 1. The core components of the Council’s mandate in 2026 9 Figure 2. Legislative role in approving medium-term budget proposal 20 Figure 3. The Council ranks sixth on the OECD Fiscal Advocacy Index 25 Figure 4. The Council has high media coverage 26 Figure 5. Sentiment analysis of media articles mentioning the Council 27

TABLES Table 1. Implementation of recommendations from the 2021 OECD Review 12

BOXES Box 1. Growing functions of the Irish Fiscal Advisory Council 10 Box 2. Long term fiscal sustainability analysis by the Austrian Fiscal Advisory Council 14 Box 3. The escalation process for securing access to information at the Portuguese Public Finance Council 16 Box 4. How the Slovak Council for Budget Responsibility monitors compliance with expenditure ceilings 21 Box 5. AIReF’s opinion on proposed reforms to the national fiscal framework 22 Box 6. How the Council promotes learning through its Path for the Public Finances Conference 29 Box 7. Layering analytical content: international and domestic examples 316  OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

AIReF Independent Authority for Fiscal Responsibility (Spain) C&AG Comptroller and Auditor General

OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

AIReF Independent Authority for Fiscal Responsibility (Spain) C&AG Comptroller and Auditor General CBR Council for Budget Responsibility (Slovak Republic) CFP Public Finance Council (Portugal) DGDP Debt-to-Gross Domestic Product ratio DG ECFIN Directorate General for Economic and Financial Affairs DPER Department of Public Expenditure, Infrastructure, Public Service Reform and Digitalisation DoF Department of Finance EC European Commission ESRI Economic and Social Research Institute EU European Union FRA Fiscal Responsibility Act GDP Gross Domestic Product GNI Gross National Income IBO Independent Budget Office (New York) IFI Independent Fiscal Institution IMF International Monetary Fund MoU Memorandum of Understanding OECD Organisation for Economic Co‑operation and Development PBO Parliamentary Budget Office SGP Stability and Growth Pact SMEs Small and Medium-Sized Enterprises The Council Irish Fiscal Advisory Council 2021 Review 2021 OECD Review Abbreviations and acronyms 7

OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

The Irish Fiscal Advisory Council was established in 2011 and placed on a s tatutory footing through the Fiscal Responsibility Act 2012. This OECD Review assesses progress since the previous 2021 Review , identifying emerging challenges and setting out actions to ensure that the Coun cil remains effective in a changing national and European fiscal context. Ireland’s fiscal position has further improved since 2021, underpinned by robust economic growth, sustained budget surpluses and a declining debtto-GDP ratio. Exceptional corporation tax receipts have enabled the establishment of the Future Ireland Fund and the Infrastructure, Climate and Natu re Fund to help address long-term fiscal pressures. However, public expenditure continues to increase, particularly in healthcare, and around 85% of these windfall revenues is being absorbed each year , with the remainder

enabled the establishment of the Future Ireland Fund and the Infrastructure, Climate and Natu re Fund to help address long-term fiscal pressures. However, public expenditure continues to increase, particularly in healthcare, and around 85% of these windfall revenues is being absorbed each year , with the remainder going to the Funds. As these receipts are highly volatile and concentrated among a small number of firms, any downturn would have a disproportionate impact on public finances and would con stitute a significant fiscal risk. Strong revenues also weaken immediate pressures for fiscal restraint, increasing the likelihood that underlying vulnerabilities build during periods of economic strength. Ireland has yet to transpose the new European Union (EU) Economic Governance Framework into national law. Even so, s takeholders note that Ireland’s low debt ratio and multinational -driven tax base limit the framework’s relevance compared with many peers. In particular, strong headline debt and deficit indicators do not trigger fiscal adjustments, even though surpluses are largely driven by wind fall corporate tax receipts. Moreover, debt measured against GDP may understate underlying vulnerabiliti es, as modified Gross National Income (GNI) provides a more relevant benchmark for the domestic economy. This highlights the need for a national fiscal framework better aligned with domestic r isks. In the absence of a clearly defined national fiscal rule, there is no agreed benchmark against which to assess fiscal policy, weakening accountability and oversight. At present, the Medium-Term Fiscal and Structural Plan provides the sole fiscal anchor through net expenditure ceilings. However, awareness of th ese ceilings remains limited, and as long as EU thresholds are met, non-compliance carries no effective consequences . A strong fiscal framework depends on both effective rules and independent oversi ght. The Irish Fiscal Advisory Council is widely regarded as highly effective in fulfilling this r ole. It delivers significant impact despite its small size and ranks among the top performers in the OECD Fiscal Advocacy Index. Its influence reflects both the strength of its analysis and its ability to communicate compl ex issues in a clear and accessible way. In recent years, the Council has expanded its use of timely and layered analytical outputs,

despite its small size and ranks among the top performers in the OECD Fiscal Advocacy Index. Its influence reflects both the strength of its analysis and its ability to communicate compl ex issues in a clear and accessible way. In recent years, the Council has expanded its use of timely and layered analytical outputs, including blogs, summaries and visual formats, which has helped to broaden the reach of its work and strengthen its role in public debate. Its analysis of corporation tax sustainab ility and climate-related fiscal risks has been particularly influential in shaping policy discussions. The Council has also been strengthened in several areas since 2021. The time commitme nt and remuneration for the Chair have been increased, better reflecting the demands of the role. Funding arrangements are being improved to support greater resource stability over time. Audit requirements have become more proportionate, reducing the administrative burden on the Secretariat.

Executive summary8  OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

Despite these strengths, structural constraints continue to limit the Council’s effecti veness. Restricted access to detailed spending data, limited autonomy over staffing, and the absence of a clearly defined role in relation to assessing net expenditure growth constrain its ability to assess fiscal developments and fully perform its functions. Addressing these constraints will be important to sustain its impact, particularly given Ireland’s specific fiscal context. Summary of recommendations This OECD Review recommends the following actions to help ensure that the Council remains effec tive: • Fiscal framework: Ireland lacks effective national fiscal rules, and this reduces the Council 's capacity to assess fiscal policy. Establishing a stronger role for the Houses of the Oireachtas (parliament) in reviewing and approving the expenditure ceilings set out in the Medium-Term Fiscal and Structural Plan, and inviting the Council to appear before the Committee on Budg etary Oversight to present its assessment of these ceilings, would strengthen national owners hip and accountability, enhancing the effectiveness of the expenditure ceilings as fisc al anchors and supporting more effective fiscal oversight.

and Structural Plan, and inviting the Council to appear before the Committee on Budg etary Oversight to present its assessment of these ceilings, would strengthen national owners hip and accountability, enhancing the effectiveness of the expenditure ceilings as fisc al anchors and supporting more effective fiscal oversight. • Access to information: Persistent gaps and delays in spending data limit the Council’s ability to assess fiscal developments and risks. Legislation should guarantee the Council’s right to timely access to the information needed to fulfil its mandate. In addition, establishing a formal data access framework, including a memorandum of understanding with the Department of Public Expenditure, Infrastructure, Public Service Reform and Digitalisation, a published statement of d ata needs and clear escalation mechanisms, would strengthen analytical capacity. • Operational independence: Constraints on staffing and organisational flexibility limit the Council’s ability to align resources with its mandate. These constraints are exacerbated by delays in adopting legislation to update the budget ceiling. Advancing the legislative process a nd granting full autonomy over staffing within the approved budget would strengthen operational independ ence and support more effective delivery. • Longer-term analysis: A small secretariat and competing demands limit the Council’s capacity to undertake regular long term sustainability analysis. Dedicating stable resources to this analysis would embed it as a core function and strengthen the Council ’s ability to highlight emerging fiscal risks. • Communications: The Council has achieved strong visibility, but favourable headline fi scal indicators and a changing media landscape make it harder to attract and sustain attention on fiscal risks. More systematic use of timely, layered analytical outputs, alongside deeper engagement with parliamentarians beyond committee settings, non ‑government stakeholders and regional audiences, would help keep its analysis prominent and influential. Strong corporation tax receipts continue to create pressure for higher spending, maki ng adherence to medium-term ceilings more difficult. At the same time, pro-cyclical fiscal po licies risk exacerbating economic imbalances, while the tax base remains narrow. Sound fiscal policy choices are therefore critical. A credible and well-resourced fiscal council is an essential asset i n supporting a fiscal path that balances

medium-term ceilings more difficult. At the same time, pro-cyclical fiscal po licies risk exacerbating economic imbalances, while the tax base remains narrow. Sound fiscal policy choices are therefore critical. A credible and well-resourced fiscal council is an essential asset i n supporting a fiscal path that balances short-term pressures with long-term sustainability. Its role is particularly important during periods of strong fiscal performance, when risks can build gradually and may not be evident in headline indicators. 9

OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

1.1. About the Council The Irish Fiscal Advisory Council (the Council) was established in 2011 in response to the global financial crisis, with the aim of strengthening fiscal oversight and sustainability. It was placed on a stat utory footing under the Fiscal Responsibility Act (FRA) in 2012, aligning Ireland with European Union (EU) fiscal governance requirements. The Council provides independent assessments of the Government’s management of the publi c finances and the economy. Since the 2021 Review, its mandate has been expanded to includ e an assessment of the State’s use of national funds (see Figure 1 and Box 1). Figure 1. The core components of the Council’s mandate in 2026

Notes: Green icons correspond to original mandates, orange to mandates introduced since the establishment of the Council, and grey to forthcoming mandates.

In relation to “Budgetary Rule Compliance” the Council must monitor whether the governmen t is complying with legislated fisca l rules. The primary statutory rule outlined in the Fiscal Responsibility Act 201 2 is that the general government’s budget position must be either in balance or in surplus or moving at a satisfactory pace toward that condition.

1 Progress since the 2021 OECD Review10  OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

The Council is composed of five part-time members, supported by a full-time Secretariat. The Secretariat

1 Progress since the 2021 OECD Review10  OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

The Council is composed of five part-time members, supported by a full-time Secretariat. The Secretariat is led by a Chief Economist and comprises four analytical staff and one administrative staff member (unchanged since the 2021 Review). The Secretariat remains small by international standards, particularly given the expansion of the Council's mandate since 2021. While stakeholders consistently highlighted the effectiveness of the current team, the concentration of expertise in a small num ber of staff inevitably creates capacity and continuity risks and limits the flexibility to develop new areas of analytical work. Staffing levels remain below the complement authorised by the Department of Public E xpenditure, Infrastructure, Public Service Reform and Digitalisation (DPER), reflecting the budget constraints identified in the previous review. Box 1. Growing functions of the Irish Fiscal Advisory Council The Council’s mandate has expanded over time, reflecting evolving fiscal gover nance requirements. Two legislative changes have added new functions since its establishment, with a third pending. This expansion has not been accompanied by a commensurate increase in budget or staffing. The additional responsibilities are: • Endorsement of macroeconomic forecasts : To comply with new EU requirements, the Council’s mandate was expanded in 2013 through the Ministers and Secretaries Amen dment Act, providing a formal role in endorsing official macroeconomic forecasts. • Assessment of the State’s economic and fiscal position: Under the Future Ireland Fund and Infrastructure, Climate and Nature Fund Act 2024 , the Council evaluates the State’s economic and fiscal position to inform recommendations on whether contributions to the Future Ireland Fund and the Infrastructure, Climate and Nature Fund should be adjusted or suspended. The new EU Directive (2024/1265) will further expand the Council’s responsibilities to include assessing the coherence and effectiveness of national fiscal frameworks. Transposition into Irish law is still pending, with legislation expected shortly. The Council publishes a range of outputs each year, including Fiscal Assess ment Reports, a Pre-Budget

The new EU Directive (2024/1265) will further expand the Council’s responsibilities to include assessing the coherence and effectiveness of national fiscal frameworks. Transposition into Irish law is still pending, with legislation expected shortly. The Council publishes a range of outputs each year, including Fiscal Assess ment Reports, a Pre-Budget Statement, a Budget Day Flash Release and its Endorsements of Official Economic Forecasts. It also produces less frequent outputs, including research on long term fiscal sustainability and risks, as well as working papers, analytical notes and blogs. In addition, it has developed a number of datasets to support research. The Council continues to host its annual conference, Path for the Public Finances, which focuses on longterm public finance challenges in Ireland, with each conference centred on a specific theme. It also contributes regularly to national and international conferences. 1.2. Context of current review In 2025, the Chair of the Council requested an OECD external review. The Council has regularly undergone external evaluation, including a peer review in 2015 and an OECD review in 2021, in line with international good practice. This review aims to assess progress against earlier recommendations and to rev iew how the Council can continue to meet OECD Principles for Independent Fiscal Institut ions (IFIs) and EU minimum standards in a changing fiscal and institutional context. 11

OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

The 2021 OECD Review (2021 Review) found that the Council made a significant contr ibution to fiscal oversight in Ireland, supported by analysis tailored to the Irish economy and strong pu blic engagement. Despite its small size, it established a reputation for independence, technical credibility and transparency, and helped raise awareness of key fiscal issues among policymakers and the public. At the same time, the 2021 Review identified several challenges: • Budget: Growing funding in line with price inflation did not reflect the Council’s main cost drivers, particularly public sector pay, and combined with an expanded mandate placed pressure on staffing and delivery capacity.

At the same time, the 2021 Review identified several challenges: • Budget: Growing funding in line with price inflation did not reflect the Council’s main cost drivers, particularly public sector pay, and combined with an expanded mandate placed pressure on staffing and delivery capacity. • Leadership: The time formally allocated to the Chair role was insufficient, while gaps in leadership appointment and transition arrangements created risks for continuity. • Governance requirements : Oversight requirements, particularly external audits, imposed a disproportionate administrative burden relative to the Council’s size. • Access to information : While macroeconomic data were available, access to broader budget information was often delayed or incomplete, limiting effective and systematic scrutiny. • Staffing: Constraints on budget flexibility and staff grading hindered recruitment and retention. • Medium to longer-term fiscal issues: Ireland’s budget process emphasised annual planning, and stakeholders called for the Council to strengthen its role in highlighting medium and long-term fiscal risks. The 2021 Review set out recommendations to address these challenges and stren gthen alignment with OECD Principles for IFIs. Five years on, this review assesses progress, identifies remaining constraints, and considers how the Council’s role should evolve in a changing fiscal context. 1.3. Progress in relation to recommendations in the 2021 Review A summary of progress against the 2021 recommendations is provided in Table 1.12  OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

Table 1. Implementation of recommendations from the 2021 OECD Review

Three broad observations emerge from implementation since 2021. First, important progress has been made in improving governance and leadership. Adjustments to the Chair’s time allocation and to external audit processes have reduced operational pressures . Proposed reforms to funding arrangements would further strengthen resource stability, but delays in implementation have limited their practical impact to date. Second, progress in strengthening mediumand long-term fiscal analysis has been partial and constrained by resources. While analytical work has expanded in some areas, the Council has not yet been able to establish a regular and predictable cycle of long-term sustainability analy sis.

have limited their practical impact to date. Second, progress in strengthening mediumand long-term fiscal analysis has been partial and constrained by resources. While analytical work has expanded in some areas, the Council has not yet been able to establish a regular and predictable cycle of long-term sustainability analy sis. Implementation AssessmentKey actor(s)Recommendation Remains unresolved despite the Council having an expanded mandate. Proposed legislation to address this issue is under way. The Finance (Tax Appeals and Fiscal Responsibility) Bill 2025 is currently undergoing pre-legislative scrutiny and would both raise the Council’s budget ceiling and adjust its annual resource allocation. However, progress has been delayed, slowing implementation of these reforms. Department of Finance (DoF), the Council The Council’s budget ceiling should be indexed to key items that make up the Council’s expenditure. Periodic review of the budget ceiling and indexing mechanism should be built in to ensure continued adequacy. 1 Officials at the Department of Finance advised that other agencies and bodies similar to the Fiscal Council would ordinarily have the Chairperson as the Accountable Officer. However, for the Council, this was deemed a standard provision that cannot be changed. DoF, the Council The role of accountable officer could be transferred to the Head of the Secretariat. 2a The Chair role has been advertised and filled on the basis of a commitment of up to 96 days per annum (minimum of 60 days). The CouncilThe Chair’s role should be advertised as up to half-time.2b Some additional duties have been allocated to the Deputy Chair role. The Department of Finance does not view legislative change as being necessary. DoF, the Council The Deputy Chair role should be formalised in legislation with greater responsibilities. 2c The external audit is now more proportionate to the size of the Council. C&AG, the Council The Council should undergo proportional governance and audit given its size. 3a No progress has been made on this. This is linked to the fact that

responsibilities. 2c The external audit is now more proportionate to the size of the Council. C&AG, the Council The Council should undergo proportional governance and audit given its size. 3a No progress has been made on this. This is linked to the fact that the Council does not have full autonomy on staff grades and how to use its budget. DoF, the Council One of the Economists could be given a Deputy Head of Secretariat role to build greater succession planning and alleviate risks related to any change in leadership. 3b The Council still does not have a statutory right of access to information. Discussions around an extended MoU have been had, but the Council has not been able to make meaningful progress on this. A draft Statement of Data Needs has been written, but is yet to be published. DoF, DPER, the Council The Council should set out a statement of data needs and extend its MoU to cover all of its functions. It should also have a statutory right of access to information. 4 The Council still does not have full autonomy over grading structure. Hiring requires the prior consent of the government. DoF, the Council The Council’s leadership should be given full autonomy to hire and dismiss staff and allow flexibility in staff grading structure. 5a The Council has taken steps to gender proof job advertisements. Members of staff actively engage with the Irish Society for Women in Economics. The Council The Council needs to pay special attention to ensuring gender equality in its staffing. 5b Progress has been made on a new long term sustainability report, which is planned to be published in 2026. The Council has strengthened other aspects of its budgetary analysis, including the impact of Climate Change on the public finances. The Council The Council should further strengthen its annual budgetary analysis, highlighting mediumand longer-term fiscal issues. 6

Note: Progress levels made on the recommendations are indicated by the following icons:

strengthened other aspects of its budgetary analysis, including the impact of Climate Change on the public finances. The Council The Council should further strengthen its annual budgetary analysis, highlighting mediumand longer-term fiscal issues. 6

Note: Progress levels made on the recommendations are indicated by the following icons: Full alignment Near alignment Mid alignment Partial alignment No alignment 13

OECD REVIEW OF THE IRISH FISCAL ADVISORY COUNCIL 2026 © OECD 2026

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