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FINANCE

EMPLOYERS' group IBEC has warned the Government against reducing the deficit by more than €3.6bn in the Budget.

The group told Finance Minister Michael Noonan, above, and Public Expenditure Minister Brendan Howlin at a meeting that €3.6bn would be enough to meet the 8.6pc of GDP target set out under the EU/IMF programme.

IBEC director general Danny McCoy said a larger adjustment risked further damaging the domestic economy. It also urged the Government to focus on spending cuts rather than tax rises.

The group expects GDP to grow by 1.4pc this year and 2.4pc next year. It forecast the economy would still grow in the second half of this year, with strong exports offsetting the effects of weaker global conditions.

Meanwhile, Professor John Fitzgerald of the Economic and Social Research Institute (ESRI) advocated using the proceeds of sales of State assets for paying down State debt rather than investing it in job creation.


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