Meeting in Farmleigh House last week, cabinet ministers restated their commitments to take €3bn in cuts and taxes from the 2011 budget. By the end of 2014, the government said it has pledged to lop €7.5bn off the budget deficit.

It is easy to lose sight of the goal the austerity budgets, first introduced in late 2008, are attempting to reach: deflate the ballooning annual budget deficit that will amount to almost 12% of GDP, or €19.5bn, to under 3% by the end of 2014. It is the target that the government is obliged to meet under the EU's stability and growth pact.

It is all the more surprising, then, that according to recent reports, few leading forecasters believe the 2014 deadline will be reached. The IMF was the most pessimistic, predicting that the annual deficit by the end of 2014 would be as high as 5.9% of GDP based on the growth forecasts that are less optimistic than those of the government.

Each year, the Department of Finance has to prepare forecasts to comply with the terms of the pact. In recognition of the severity of the banking collapse, Ireland and Britain won a year's extension, bringing the deadline out to 2014.

"Since mid-2008, the government has implemented a series of difficult but necessary budgetary adjustments which have been welcomed by the EU Commission and other international bodies and by investors," the department said in the budget documents last December. "The government is committed to continuing to meet its obligations under the stability and growth pact. The government has sought to balance the need to stabilise the public finances and the need to position the economy to take advantage of international recovery."

According to the department's forecasts, a budget deficit of 10% next year would glide down in successive years to 7.2% and 4.9%, and then edge inside the 3% goal by the end of 2014.

Seven months later the IMF, in its annual report on Ireland, said the budget deficit projected this year, at 11.9% of GDP, would remain stubbornly high at 11.1% next year. By 2012, as growth returns for a second year, the deficit falls to 8.6% and dips to 7.3% in 2013 as the deadline approaches. By the end of 2014, however, the deficit is still towering at a remarkable 5.9%. No wonder the Washington forecasters warned that the government would need to prepare for even more cuts if the target were to be reached.

Washington's report card read: "The staff supports the appropriately ambitious consolidation plan through 2014 but cautioned that the required adjustment may be larger than projected by the authorities," because growth forecasts were lower than those the government were projecting.

Presenting its growth forecasts to 2015, the Economic and Social Research Institute said the IMF was being too downbeat about the prospects for economic growth in the coming years to reduce the deficits faster.

The Irish economy in the past responded to the world economy and would again benefit disproportionately when world growth resumed at a healthy clip. The ESRI sees the budget deficit slumping to well below 3% if GDP were to rise by an average 4.6% through 2015. Even a lower-growth outlook would see the budget deficit returning below the 3% target within the forecasting period.

But bring the forecasting period forward by a year and only the ESRI's high-growth outlook predicts that the 3% target would be met for the EC's deadline in 2014. If the economy expands at a lower rate, the deficit, even with the €7.5bn in additional cuts, will be at an alarming 4.7% of GDP by the end of 2014.

"Under the low-growth scenario, you have to do more than €7.5bn in cuts, no doubt about it," ESRI director John FitzGerald said.

The conclusion must be that the government is looking for the first €3bn of the €7.5bn in cuts because it has no choice. Last week it borrowed money for ten years at the very high annual interest rate of 5.5%, the clearest signal that international markets believe Ireland remains in danger of being swamped by its banking debts.

UCD professor Karl Whelan said there was "nothing sacred" about the 3% target.

"I would hope that when the pact is redrawn in the coming years that it puts much less emphasis on some magic number," he said, adding that Ireland's elevated debt levels, including the liabilities from the banks, were "already pretty scary" and the sovereign debt markets would unfavourably read any slippage in the commitment to keep cutting.

Ireland has no longer any headroom. Government ministers will continue to pledge that the cuts will be made over the coming months.

The IMF verdict on Ireland's debt

"To counter the deteriorating fiscal position, the authorities moved early to make substantial, balanced and lasting consolidation efforts... The consolidation plan, outlined in the December 2009 Stability Programme Update, aims to reduce the deficit to below 3% of GDP by 2014. The plan envisages fiscal adjustment of 4.5% of GDP over 2011-2014, of which about 1% of GDP represents reductions in capital expenditures.

"The staff's macroeconomic projections imply that the required medium-term adjustment could be larger than projected by the authorities. Starting from a higher projected deficit in 2010 and based on less optimistic macroeconomic projections, staff estimates that the adjustment need over 2011-2014 would be 6.5% of GDP, two percentage points of GDP higher than the authorities do."