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Saturday 3 December 2016

Lenihan rules out prospect of early emergency budget

Patricia McDonagh

Published 25/06/2010 | 05:00

FINANCE Minister Brian Lenihan has ruled out the possibility of an early emergency budget this year.

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Mr Lenihan said yesterday that the Budget would be held in early December, but he insisted no decision had been made on the precise date.

The Government has committed itself to €3bn in cuts this year, with €1bn to come from capital spending and €2bn in current spending.

However, speculation has been mounting that the Government may put forward an early budget before this to remedy the current black hole in the public purse.

But Mr Lenihan yesterday moved to dismiss suggestions that emergency cost-cutting was required when asked by Labour leader Eamon Gilmore to name the date of the Budget.

"Considerable scepticism has been expressed about whether there would be an additional budget this year.

"There will be no additional budget this year; the Budget will be in December . . . as is the usual practice, but no precise date has been fixed," he said.

Bubble

Mr Lenihan also sought to defuse reports that the Finance Department had warned the Government of the dangers of a property bubble in 2005.

According to briefing material prepared for the department's secretary general, Kevin Cardiff, the department warned over several years that the "over-emphasis on construction left the economy vulnerable to macroeconomic shocks".

The contents of the documents were released under the Freedom of Information Act in the same week Mr Lenihan announced an external review of the department's management of the financial crisis.

But Mr Lenihan insisted that there was nothing new in it.

"Indeed, the Taoiseach's Budget in December 2005 (when he was finance minister) warned of the high proportion of economic activity and employment accounted for by construction and implied economic vulnerability to shock.

"Those were the words of the Taoiseach in December 2005. I am suggesting there is nothing new in the report," he said.

Irish Independent

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