BIS central bankers’ speeches  3  to about 25 per cent in 2007.8 Particularly unfortunate was the decision to permit strong increases in current spending which were dependent on windfall revenues, rather than other, more permanent, sources of revenues. Consequently, when tax revenues collapsed as the boom turned to bust with a vengeance, a large gap between Government expenditure and revenue rapidly developed.
3. Policy responses  Following the burst of the bubble, the Irish Government has taken a number of actions to stabilise the banking system and strengthen public finances in order to support recovery. Let me focus on some of the most important.