Capital spending cuts played down, say builders
The country's builders have accused Finance Minister Michael Noonan of underplaying planned cuts to the capital programme during a recent meeting between the two sides.
The Construction Industry Federation (CIF) has written to Mr Noonan claiming they were told at the meeting there would be a spend of €16bn in the area, between 2012 and 2015.
But last week it was revealed that the spend would be just €13.8bn, a letter from CIF director general Tom Parlon states.
"You might please clarify whether or not an additional €2.2bn is envisaged from some other source,'' states Mr Parlon. He has told Mr Noonan that 25,000 jobs are at stake due to the reduction in overall spend.
"During our meeting, I set out the likelihood that construction activity will fall from 7pc to 5pc of total economic activity in 2012 and that this would result in a further 25,000 direct job losses during the year, or close to 500 per week. The decision to cut capital investment by €750m makes these projections inevitable,'' writes Mr Parlon.
"Can I also ask you about New Era, which has been identified as a significant driver of capital investment and job creation? There is little sign of any urgency, and much less transparency, in relation to New Era,'' claimed Mr Parlon.
Today, the Government is expected to give more clarity on the capital programme, with a number of high-profile transport projects to be ditched.
The Irish Independent reported earlier this week that the Government was to slash spending on major projects, including road and rail, because it was easier to sell politically than cuts in social welfare rates.
A secret memo on the capital spending programme showed ministers planned to cut at least €1.4bn over three years.
Roads, broadband, flood defences, and science research are likely to be the hardest hit.
Significantly, Public Expenditure Minister Brendan Howlin warns colleagues it would be politically risky not to cut capital spending because otherwise they would have to take tough decisions on current spending in social welfare, public sector pensions, third-level grants and medical cards.
The memo notes that "any further concessions" on capital spending would involve "tougher decisions" on current spending, which contain a "much higher political risk".