Coalition seeks bailout changes
Taoiseach to challenge IMF-EU on tax increases and sell-off of state assets
THE Government will seek to negotiate budgetary changes and hang on to the proceeds of state asset sales when the IMF-EU bailout team begin their latest review today.
Taoiseach Enda Kenny has signalled the Coalition will look for permission to stick to its promise to not increase income taxes or cut social welfare rates in this Budget.
Government sources said these topics will be on the table in the review.
The target of €3.6bn to €4bn worth of spending cuts and tax hikes will remain.
Ten days of talks with the bailout team will begin today with many of the Government's measures so far expected to be approved.
The recapitalisation of the banks is complete and access to private funds is already being achieved by Bank of Ireland.
The public finances are largely on track with the tax take and spending mostly in line with the targets set out at the start of the year.
The Comprehensive Review of Expenditure is ongoing and will play into the preparations for December's Budget.
The Government will also point to progress on reform of the legal profession, with legislation already published.
The Coalition will discuss the use of the proceeds of state assets, with the Government wanting to reinvest these funds.
Fine Gael and the Labour Party have already agreed to the part-privatisation of the ESB.
Coalition sources said last night the IMF-EU view is that the proceeds of such sales should be used for debt reduction, while the focus of the Government is on job creation and economic development.
The review overlaps with intensifying talks at EU level to address the eurozone crisis.
Taoiseach Enda Kenny yesterday rejected German Chancellor Angela Merkel's latest call for changes to the Lisbon Treaty.
Mr Kenny said that the current crisis should be tackled in the short term by using instruments already in place.
On the presidential campaign trail in Galway yesterday, Mr Kenny pointed out that he had yet to receive details of the meeting between the German leader and French President Nicolas Sarkozy.
"The EFSF (European Financial Stability Facility) change, for instance, is a change to the Lisbon Treaty, but it doesn't require a referendum and we support that, because my view is that we have a crisis now and this crisis must be dealt with in the short term and that means that you use all of the instruments, all of the facilities that were agreed upon and signed off on July 21 under the EFSF programme to deal with the current crisis.
"Personally, I do not have a very strong inclination to be talking about referendum treaty changes when you can neither guarantee the outcome, nor the timescale, for any of the countries in Europe.
"We have the Lisbon Treaty -- these things should be explored to the limit," he said.
Tanaiste Eamon Gilmore also rejected calls for changes to the Lisbon Treaty. Mr Gilmore said there was a need to implement the moves agreed at last July's emergency summit on a second bailout for Greece.
"The big problem we've had in the summer is that the decisions made on July 21 were not implemented quickly enough. So I think before we get into the business of changes to the treaty, let's do the things that are possible to do under the existing treaty framework," he said.
Mr Gilmore declined to respond to presidential candidate Dana Rosemary Scallon who criticised him for declaring his opposition to a second Lisbon Treaty referendum in public while telling the US ambassador to Ireland that he was privately in favour of it.
Ms Scallon said politicians needed to be honest.
Mr Gilmore said the only candidate that he would talk about was Labour's Michael D Higgins.