Stricter budget rules may force new referendum
TAOISEACH Enda Kenny is facing the nightmare prospect of yet another EU referendum as Germany presses for even stricter budgetary rules.
The move comes as the Government deals with the latest examination of the bailout by the EU-IMF with health spending in the spotlight.
Despite protests from ministers, health spending is understood to be top of the agenda for the latest bailout review this week.
The troika singled out under-fire Health Minister Dr James Reilly and demanded he strengthen financial management of his department.
A European Commission source said the current review "will focus on strengthening budgetary management in the health sector to ensure that it can deliver desired objectives within budget".
Finance Minister Michael Noonan and Public Spending Minister Brendan Howlin met with the representatives of the IMF, European Commission and the European Central Bank on the first day of the eighth review.
Mr Howlin again denied the IMF has already complained about the overrun in health spending.
"We need to report fact -- not perception," he said.
Taoiseach Enda Kenny heads to an EU leaders summit in Brussels tomorrow and will travel to Bucharest this evening for a meeting of Fine Gael's EU grouping, the European People's Party.
Ahead of the summit, German Finance Minister Wolfgang Schaeuble said he wants legal changes to European Union treaties as early as next year to strengthen the euro area's ability to enforce budgetary discipline.
The call would almost certainly cause a referendum in Ireland.
Mr Schaeuble said the proposals, which he discussed with German Chancellor Angela Merkel, would give the EU's monetary affairs commissioner powers to reject national budgets and keep European Parliament members from non-euro states such as the UK from blocking decisions that only affect the euro region.
The Government was aware yesterday of Mr Schaeuble's comments but didn't respond. But a source said Europe needed to implement the mechanisms currently available, before moving on to any new measures.