Friday 24 November 2017

FG to 'take the hit' for Labour in Budget 2014

But €1bn gap emerges between backbenchers over cuts and taxes

To date Michael Noonan has not budged
To date Michael Noonan has not budged
John Drennan

John Drennan

FINE Gael is planning to "allow" Labour some Budget "successes" as concern grows within the dominant coalition party over increasing unhappiness within its partners.

Amid a growing political consensus within the coalition parties that the budgetary adjustment will be lower than €3.1bn, one Fine Gael minister said: "The scenario will be created in the Budget where we will ensure a lot of the good news will go Labour's way."

The minister said: "We understand Labour need to reconnect with the coping classes, they need successes."

He added: "If we are clever about it, Labour will be allowed a couple of successes when it comes to the coping classes. They have a difficulty and it is in our interest to keep the Coalition going."

The minister noted: "One of the good-news stories will be the extension of free GP care to the under-fives – that is entirely achievable and it could be a Labour issue."

He also added: "If it means shutting the f**k up and letting Labour take a bow we should take the hit and nurse them along."

The plans to create a more united Labour-Fine Gael front could, however, be scuppered by growing divisions between the backbenchers of both parties.

Significantly, a €1bn gap has emerged between Fine Gael and Labour backbenchers over the appropriate level of cuts and taxes in Budget 2014.

Labour's Aodhan O Riordain last week told the Sunday Independent that "it is possible we could meet the 5.1 per cent target with cuts and tax increases of €2bn".

O Riordain added that "this would depend on a lot of other factors", but other TDs within the Labour Party's 'not another cent in austerity' group have become increasingly critical of the Government's austerity plans.

Labour TD Kevin Humphreys told the Sunday Independent that "in the Programme for Government 5.1 per cent rather than €3.1bn is the signed up figure".

He added: "Cuts for cuts' sake or just as some experiment is madness – this is no time for economic experiments in austerity."

To date Michael Noonan has not budged from the €3.1bn figure, but ministers across the Cabinet are significantly softening their stance on the expected level of cuts and taxes.

Speaking to the Sunday Independent, Communications Minister Pat Rabbitte said: "There is real flexibility, though Merrion Street will be telling us we cannot be sure until the final figures come in in November."

Mr Rabbitte said a critical factor was the increased "numbers in employment – you can massage unemployment statistics, but there is a real increase of 33,000 in people who are working, that's real".

Another Fine Gael minister told the Sunday Independent: "It will be less than €3bn, perhaps not significantly less but it will be below the €3.1bn."

However, in a move likely to spark further cross-party backbench tensions, the Fine Gael 'five-a-side' group of young fiscally conservative TDs want Michael Noonan to maintain a hard-line stance.

Speaking to the Sunday Independent, Fine Gael's Eoghan Murphy said: "We don't want any deviation from the €3.1bn."

He said such a level of cuts would mean "this could potentially be the last harsh Budget''.

However, he warned: "In a scenario where we are about to leave the bailout, it is all the more critical we send the correct message over responsible budgeting. To fall short now would do a terrible disservice to what we have endured to date."

In a move that will not impress the Taoiseach, the Sunday Independent has learnt that the 'five-a-side' group is planning to have its own meeting "prior to next week's FG think-in".

The group also plans to "raise the €3.1bn issue at the think-in if we are allowed".

Sunday Independent

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