OECD review of the Irish Fiscal Advisory Council 2026

1. Progress since the 2021 OECD Review

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 statutory 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 public finances and the economy. Since the 2021 Review, its mandate has been expanded to include 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 government is complying with legislated fiscal rules. The primary statutory rule outlined in the Fiscal Responsibility Act 2012 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.

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 number 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 Expenditure, 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 governance 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 Amendment 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 Assessment 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 long-term 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 review how the Council can continue to meet OECD Principles for Independent Fiscal Institutions (IFIs) and EU minimum standards in a changing fiscal and institutional context.

The 2021 OECD Review (2021 Review) found that the Council made a significant contribution to fiscal oversight in Ireland, supported by analysis tailored to the Irish economy and strong public 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.

• 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 strengthen 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.

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 medium- and 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 analysis.

Third, core structural constraints relating to access to information and operational independence remain largely unresolved. Continued reliance on government departments for both resources and data limits the Council’s ability to plan and prioritise its work and fully exercise its mandate.

Given the Council’s small size, these constraints also require careful prioritisation of analytical work, with trade-offs between short term monitoring and deeper medium- and long-term analysis.

These are reflected in more detail below.

1.3.1. Progress on governance, leadership and funding arrangements

Since the 2021 Review, important progress has been made in aligning the Council’s governance arrangements with its operational needs. The Chair role is now defined at up to 96 days per year, with a minimum commitment of 60 days, better reflecting the demands of the position. In addition, external audit processes have been recalibrated in consultation with the C&AG to better reflect the scale and complexity of the Council, significantly reducing the administrative burden on the Secretariat.

At the same time, some governance and leadership recommendations remain unmet. A key ongoing issue is that the Chair continues to carry a significant administrative load stemming from their role as accountable officer, including responsibility for approving expenditures, procurement decisions, software choices and other operational matters. This absorbs time that could otherwise be devoted to the Council’s analytical and oversight functions. The Department of Finance did not support transferring the accountable officer role to the Head of Secretariat, citing consistency with practice across comparable bodies, and legislative changes to strengthen the Deputy Chair role were also not pursued. While these arrangements are now more manageable than in 2021, there would be merit in reviewing how responsibilities are distributed between the Chair and the Secretariat to ensure that administrative demands do not unduly constrain strategic leadership.

There is also a proposed reform to the Council’s funding arrangements. The current approach to funding the Council, funding indexed to price inflation, does not reflect key cost drivers such as public sector pay. Draft legislation proposes to link budget growth to underlying expenditure drivers and to raise the ceiling. If enacted, this would materially improve the stability and adequacy of the Council’s resources compared to the framework in place at the time of the 2021 Review.

However, delays in enacting the legislation mean that no material progress can yet be claimed in this area. Although the reform has been on the government’s legislative agenda since spring 2023, it has yet to be adopted. At present, it is proposed that these changes are made through The Finance (Tax Appeals and Fiscal Responsibility) Bill 2025. Until there is further progress with this legislation, the Council continues to operate under the budget arrangements set at its creation despite being tasked with the addition of two new functions and an expected third to come (see Box 1 presented earlier).

1.3.2. Mixed progress in strengthening medium- and long-term analysis

The 2021 Review highlighted the importance of establishing a structured and sustained programme of medium- and long-term fiscal analysis. Progress has been uneven.

The Council has expanded analytical work in several areas, including risks related to corporation tax and climate change, and continues to contribute to debate through its annual Path for Public Finances conference. Yet, it has not established a regular cycle of long-term sustainability reporting. The next Long Term Sustainability Report is expected in 2026, five years after the previous edition.

While these outputs are valuable, they fall short of best practice among comparable institutions (see the example of Austria in Box 2) and limit the Council’s ability to consistently assess fiscal sustainability risks.

Capacity constraints have been the primary factor. Budget limitations have affected staffing levels and restricted investment in analytical tools, reducing the Council’s ability to dedicate resources to long term analysis without displacing core statutory work.

Progress in this area will depend on more stable resourcing and greater flexibility in staffing. If reforms to the budget framework are implemented and operational autonomy strengthened, the Council would be better positioned to recruit and retain the expertise required and invest in appropriate analytical tools. This would enable it to establish a regular and predictable cycle of long-term analysis, aligned with international best practice.

Many OECD countries operate national fiscal frameworks anchored by clear domestic rules that complement EU requirements. These typically combine a long‑term fiscal anchor, such as a debt objective, with an operational rule to guide near‑term policy decisions. Such arrangements support effective fiscal management by linking medium‑term sustainability objectives to annual budgetary outcomes. Multiannual expenditure frameworks are a common approach. For example, in the Netherlands, the government’s coalition agreement sets four‑year expenditure ceilings across key spending areas, while in Denmark the Budget Act establishes binding four‑year ceilings for the state, municipalities and regions (Rozenov et al., 2025[1]).

In Ireland, the net expenditure ceilings set out in the Medium Term Fiscal and Structural Plan have not yet evolved into a clearly defined domestic fiscal rule. In the absence of a well‑established operational rule, the framework provides only a limited basis for guiding short‑term fiscal policy and anchoring expectations. In this context, strengthening medium‑ and long‑term fiscal analysis becomes increasingly important. Such analysis can provide an alternative basis for assessing sustainability, identifying emerging risks and informing policy decisions where formal fiscal rules are less firmly embedded.

Box 2. Long term fiscal sustainability analysis by the Austrian Fiscal Advisory Council

Austria’s Fiscal Advisory Council (Fiskalrat) provides a useful example of how a relatively small IFI can deliver regular, high-quality long-term sustainability analysis.

Established in 2013, the Fiskalrat operates with a small secretariat of around six staff members who support its analytical work. Although it does not perform the endorsement function carried out by many of its European peers, it has established a consistent, predictable and well regarded cycle of long term fiscal reporting.

The Fiskalrat’s statutory mandate requires it to publish a comprehensive fiscal sustainability report every three years, with the first report issued in 2021. This work provides the foundational basis for its assessment of risks to general government debt sustainability and supports data driven, long term fiscal planning. In its triennial reports, the Fiskalrat projects fiscal sustainability horizons out to 2070, closely modelling age-related expenditures, labour market shifts, and structural budget pressures.

To ensure these long-term projections remain relevant between major reporting cycles, the Fiskalrat regularly supplements its work with targeted working papers and brief analytical updates. This includes:

• Pension and demographic stress-testing: The Council frequently publishes dedicated working papers that deep-dive into Austria's statutory pension system, evaluating the long-term fiscal impacts of demographic aging, early retirement trends, and the sustainability of federal pension contributions.

• Healthcare and long-term care cost drivers: Recognising these as the fastest-growing expenditure categories, the Fiskalrat releases specialised analyses that isolate cost drivers in healthcare, simulating how different reform scenarios or technological advancements will pressure sub-national budgets over a multi-decade horizon.

• Climate change and green transition modelling: In recent years, the Council has expanded its working paper series to analyse the long-term fiscal risks of climate change. This includes quantifying the budgetary costs of missing carbon emission targets, the structural shift in tax revenues away from fossil fuels, and the long-term public investment required for green transitions.

Through this combination of flagship triennial reports and agile, thematic working papers, the Fiskalrat ensures that Austrian policymakers have continuous access to rigorous, forward-looking fiscal risk assessments despite the institution's lean institutional footprint.

1.3.3. Continued constraints on access to information and operational independence

Structural constraints relating to access to information and operational independence remain the most significant outstanding challenges for the Council’s effectiveness.

The Council has established effective access arrangements for its endorsement function through a Memorandum of Understanding (MoU) with the Department of Finance. At the same time, comparable arrangements have not been put in place with DPER for other aspects of its mandate, particularly in relation to detailed spending data and the assumptions underpinning budget projections. This creates gaps in coverage and results in uneven access to information across the Council’s functions.

While DPER generally shares the spending information it receives from other Departments, the Council continues to encounter limitations which restrict its analysis. This is due to delays, incomplete responses and difficulties accessing sufficiently granular information, particularly in areas such as health expenditure, pensions and other sector specific developments. These limitations affect the Council’s ability to assess fiscal developments, monitor compliance with net expenditure ceilings and evaluate whether fiscal plans are grounded in realistic assumptions.

These challenges reflect the absence of strong institutional or legal incentives for timely and comprehensive data sharing. In practice, access to information often relies on informal arrangements and goodwill, rather than legislative provisions and enforceable standards, creating uncertainty and limiting the Council’s ability to plan and deliver its work.

Addressing these issues will require more formalised and comprehensive information access arrangements. Legislation should guarantee the Council’s right to timely access to the information needed to fulfil its mandate. Arrangements should also encompass establishing a Memorandum of Understanding with DPER, publishing a clear Statement of Data Needs, and introducing structured escalation mechanisms where information provision falls short (for example, see the escalation process set out in the enabling legislation for the Portuguese Public Finance Council in Box 3). These arrangements should aim to avoid being overly burdensome on either party and be cognisant of the the level of granularity which can be provided in the context of data ownership and data protection practices.

Taken together, these arrangements would help ensure timely and consistent access to detailed bottom-up spending data and the assumptions underpinning budget projections, strengthening the Council’s ability to assess the feasibility of net expenditure ceilings. Improved access to information would also support more robust assessment of fiscal forecasts and underlying spending pressures, particularly in complex areas such as healthcare.

At the same time, operational independence remains constrained. Key decisions relating to staffing, grading and recruitment continue to require consent of the Minister for Finance, following consultation with the Minister for Public Expenditure and Reform. This limits organisational flexibility, creates uncertainty for workforce planning and constrains the Council’s ability to recruit and retain specialised expertise.

Strengthening operational independence, including by granting the Council full autonomy to determine its internal staffing structure within its approved budget, would reduce these constraints, better align the Council with OECD Principles for IFIs and strengthen its ability to deliver its mandate effectively.

Box 3. The escalation process for securing access to information at the Portuguese Public Finance Council

Portugal’s Public Finance Council (CFP) provides a relevant example of a structured escalation framework that helps ensure timely access to the information required for independent fiscal oversight. Its enabling legislation grants the Council access to all information necessary to carry out its duties as well as a set of proportionate tools that can be activated when information is not provided or when delays become unreasonable. This offers a model for how IFIs can be protected against disruptions or political interference in the flow of data.

In the first instance, institutions in breach of reporting obligations are formally notified that the CFP intends to invoke the legal mechanism of public disclosure of non-compliance, as provided for in its legislation. This tends to be very effective and is usually enough to compel public bodies to comply by providing the information requested.

The next step in the escalation process allows the CFP to publish a notice on its website identifying the information that has not been supplied and the public bodies involved. This mechanism provides transparency to stakeholders and signals concerns about delays or non-compliance while still keeping the response at a relatively low level of formality.

If issues persist, the CFP can escalate further by formally notifying a set of high-level institutions. These include the President of the Court of Audit, the Governor of the Bank of Portugal, the Parliament and, as a last resort, the President of the Republic. The availability of these higher-level interventions reinforces the expectation that public bodies must provide timely and complete information and helps mitigate the risk of political interference affecting the Council’s analytical work.