Push for all-party pact on €7bn cuts
Drive follows warning from ECB on four-year Budget plan
Published 08/10/2010 | 05:00
Dramatic behind-the-scenes efforts to arrange cross-party talks between the Government and opposition on the four-year €7bn super Budget were under way last night.
The plan is to get the leaders of Fianna Fail, Fine Gael, Labour, the Green Party and Sinn Fein to sit down and discuss their views on the options available to the Government.
The development came as the European Central Bank (ECB) became the latest international body to state the importance of adhering to deadlines and commitments on the public finances given by the Government.
And it follows the warning by ratings agency Fitch on Wednesday that we could face another crippling downgrade unless "broad-based political support'' was achieved on fixing the deficit.
Europe's top central banker yesterday said that the four-year budget plan must be "highly credible" to ward off spiralling borrowing costs and sluggish growth. Speaking after meeting with the bloc's 27 central bank governors -- including Professor Patrick Honohan -- Jean-Claude Trichet said that Ireland's goal was "absolutely clear".
"It is extremely important that the Irish Government takes all the appropriate decisions that would permit. . . a highly credible path towards the sustainability of public finances."
He said it was essential that the Government met a 2014 deadline to close the €19bn gap in the public finances. "Your goal is absolutely clear," he said.
The Green Party is trying to get agreement between government and opposition parties to discover what each party agrees and doesn't agree on.
Communications Minister Eamon Ryan has made initial contact with his Fianna Fail cabinet colleagues and wants to extend the invitation to all parties. But it is not yet clear if Taoiseach Brian Cowen is on board or if the opposition parties will agree to the talks.
The move stops short of the national government called for by Environment Minister John Gormley. The Green Party leader was forced into an embarrassing climbdown last night after getting no support for his calls.
But it goes far beyond the offer of the Department of Finance providing economic information to the opposition parties.
Mr Ryan said that just giving information was "not enough" and all parties needed to "share thoughts and ideas honestly, frankly and openly".
"We need to set up a meeting with all political parties to discuss the process without any preconceived notions or expectations. The political process should get together, find out what we agree and don't agree," he told the Irish Independent.
The talks would be somewhat comparable to the social partnership pay talks between the Government and trade unions. If agreement is reached, they could begin as early as next week.
Mr Ryan said the point of the talks would be to have a "better quality of debate and political stability".
ECB President Jean-Claude Trichet stressed the importance of the Government taking steps to fix the public finances.
"It is extremely important that the Irish Government takes all the appropriate decisions that would permit that highly credible path towards sustainability of the public finances," he said.
Mr Gormley said "the option of national government" had to be looked at and said the crisis facing the country was now too serious for party politics.
Taoiseach Brian Cowen refused to answer questions on the issue at a function in Dublin Castle last night as Mr Gormley changed his stance.
However, later Mr Cowen's spokesman insisted that the Taoiseach had rejected the suggestion that Mr Gormley had called for a national government.
Fine Gael dismissed the national government idea and said it was time for an election.
The party's finance spokesman Michael Noonan said Fine Gael could not agree with the Government when no details of what would be cut and taxed had been put forward. Mr Noonan then claimed he had a "very precise idea" of where he would cut and tax to save billions -- but said he was "simply" not telling.
Mr Gormley had said the economic crisis had gone beyond party politics.
"It's about the future of this country and that is why we need a great deal of national consensus on these issues at this stage and, if necessary, going forward, we have to look at the option of national government," Mr Gormley told Today FM.
But he softened his stance on the issue last night, and said it's "too early" to talk about national government. "I am of course open and I always have been," he told RTE.