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Sunday 11 December 2016

FG and Labour tight-lipped on how they would slash deficit

Fiach Kelly Political Correspondent

Published 01/10/2010 | 05:00

FINE GAEL and Labour last night refused to say where they would make the billions of savings and cuts needed to bring the deficit down to levels demanded by the EU.

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Finance Minister Brian Lenihan will next month publish a four-year plan aimed at bringing the deficit down to 3pc of GDP by 2014, showing roughly where the Government will cut costs and raise taxes.

The move will show the Coalition's hand, and force the main opposition parties -- who say they are committed to bringing the deficit down to 3pc -- to also provide a plan to tackle the crisis. Sinn Fein is the exception, as it does not accept that the deficit has to be reduced by 3pc over a four-year timeframe.

Both Fine Gael and Labour say they will produce alternative proposals for 2011 before the Budget on December 7, but maintain they haven't been given access to Department of Finance information yet.

Fine Gael leader Enda Kenny has said he would introduce water charges at some stage, but he does not have a policy on property tax. He has also ruled out tax hikes but has not said where his party would find the money to balance the books.

A Fine Gael spokesman said the party will soon produce a savings plan but would not say what it would contain or how many years it would cover.

He said he waited for Mr Lenihan's four-year plan "to see the full scale of the misery to be forced on the Irish public as a result of the catastrophic failure of Brian Lenihan's banking strategy".

"It is incumbent on any Government to produce detailed fiscal plans," the spokesman said.

"The Government has until December 7 to prepare its Budget, with the assistance of the Department of Finance. Fine Gael, with a tiny fraction of the equivalent resources, will be setting out our own comprehensive pre-Budget perspective ahead of December 7."

Eamon Gilmore opposes a property tax and water charges, the latter on the basis of the cost of installing meters. He has yet to outline where he will cut spending and raise taxes.

A spokesman for Mr Gilmore said the four-year plan was the Government's idea and "not an opposition plan".

"We are committing to reducing the deficit to 3pc by 2014," Mr Gilmore's spokesman added. "We will consider all of the options when we get access to the information."

Disaster

The spokesman said no decision had been made to produce an alternative four-year plan.

If Fine Gael and Labour get into power, they will not have to stick to the four-year plan. However, they will have to stick to the budgetary targets laid down by the EU.

Reacting to yesterday's announcement on the banking bailout, Fine Gael's finance spokesman Michael Noonan said Mr Lenihan's banking policy "is in tatters" and that Ireland's creditworthiness "is in ribbons".

Labour's Joan Burton said the final bailout bill of €50bn "has probably introduced levels of fear and trepidation among ordinary people".

"The blanket bailout of the banks two years ago, which the Government called 'the cheapest bailout in the world', has turned into a disaster of historic proportions," she said.

"The minister stands before us today, having brought us news of the largest bank bailout, proportionate to the nation's wealth, of any country in the world."

Irish Independent

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