Minister for Finance Brian Lenihan has said the cost of servicing the State’s debt will rise to €3.9 billion in 2009 and €5.8 billion in 2010, from €2.1 billion in 2008.

He said in response to a Dáil question from the Labour Party that the State’s debt-servicing costs would rise to 2.3 per cent in 2009 and 3.5 per cent in 2010, from 1.1 per cent of GDP in both 2007 and 2008.

The Government estimates that an increase of 10 basis points, or 0.1 percentage points, in the spread, or difference, over benchmark German debt costs raises the cost of funding the State’s overall borrowing requirement for 2009 by about €29 million.