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The Government has said it will impose whatever cuts are necessary to reach the borrowing target agreed under the EU-IMF bailout.

Fine Gael and Labour are in agreement they will cut more in December's budget, even if it means going beyond the previous estimate of €3.6bn.

The IMF's Ajai Chopra said he endorsed the budget target of reducing borrowing to 8.6pc of economic output.

Public Spending Minister Brendan Howlin said the Government would meet the target with whatever cuts were needed.

Meanwhile, Finance Minister Michael Noonan said the Government was committed to making the necessary adjustment.

Mr Noonan said if it takes more cuts to get to 8.6pc, "we'll go above €3.6bn".

"That is the Government position. We will go above €3.6bn. We are not being coy about that," he added.

"We will take all the necessary measures to reach 8.6pc. At present, it doesn't look as it will be a huge amount higher," he said.

The Government is to announce the package of spending cuts and tax hikes in the first week of November.

Mr Noonan insisted there was no difference between the coalition parties on the budgetary target.

Mr Chopra backed the Government's position, saying: "We have endorsed the target of 8.6pc as the deficit target next year."

He said the Government needs to generate growth as well.