Ireland's budget deficit increased to 13.1% of GDP in 2011, due to the recapitalisation of the banks.

Figures from the EU statistical agency Eurostat show that without the extra capital committed to the banks the deficit would have been 9.4% - below the EU/IMF target of 10.6% - but still the highest deficit in the European Union.

Today’s figures are the first official EU figures on debt and deficits of all the member states.

Eurostat has also entered reservations on the Irish returns because of continuing uncertainty over the future of Irish Life and Permanent, and over Irish Life’s shares in the special purpose vehicle that owns NAMA.

The Department of Finance says Irish Life has agreed the sale of its stake in the NAMA SPV to un-named private investors. 

This should allow NAMA's debts to remain off the State’s balance sheet.