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GUBU lives on in €3.6bn accounting error

Story by Tadhg Carey

Wednesday, 2nd November, 2011 5:00pm

We live in strange times.

Not only is the world's economic system limping badly from crisis to crisis, but there is a massive gap in political leadership.

Take Greece for example, where Prime Minister George Papandreou shocked everybody by announcing his intention to hold a referendum on the new European debt deal reached last week

The new debt deal aims to seek 50 percent losses for private holders of Greek bonds and provide the troubled eurozone member with €100 billion in additional rescue loans.

Events here at home are equally surprising, none more so than news that the State may be €3.6bn better off than previously thought.

This is one of those incidents which merits the GUBU acronym which was coined by former Taoiseach Charlie Haughey.

The story had just broken at the time of going to press, but the thought that an accounting error related to over 2 percent of Gross Domestic Product is grotesque, unbelievable, bizarre and unprecedented.

The ramifications of this are yet to be fully teased out.

But ironically, this is precisely the amount of money the Government had pledged to cut from the national budget in December in order to reduce borrowing to 8.6% of economic output.

TV3 which broke the story said that the Minister for Finance Michael Noonan will brief the government of the developments at the scheduled weekly meeting of Cabinet.

The Department of Finance said "that the medium-term fiscal statement which will be issued this Friday, will take all relevant information into account."

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