Belfast Telegraph

Sunday 21 September 2014

Disagreement over scale of cuts

Michael Noonan said an independent review of the exchequer figures should take place

The Government is at odds with a leading economic think-tank over the scale of the cuts needed to restore the economy, it has been warned.

Fine Gael said the Department of Finance wanted a seven billion euro package of savings this year, while the Economic and Social Research Institute (Esri) suggested four billion euro.

The main Opposition party's finance spokesman Michael Noonan said the massive gap demanded an independent review of the exchequer figures. He said: "This is a huge divergence, and it confirms the correctness of Enda Kenny's call for independent verification of all the essential figures."

But in a statement, the Department of Finance said it has only announced potential scenarios, including three billion euro, 4.5 billion euro and seven billion euro of cuts.

Taoiseach Brian Cowen said the Government had not yet made any decisions.

"As you know, we are consulting with a whole range of international agencies and obviously the European Union as well," Mr Cowen said. "So when we finalise this in coming days and weeks we will outline the situation in full."

Meanwhile, Mr Noonan said Ireland must bring the state's budget deficit under control by 2014 despite fears from the Esri that the plan could stifle the beleaguered economy. Mr Noonan said the country had no wriggle room over the EU-agreed target, which the think-tank described as worryingly ambitious.

The Esri said it would be preferable if the Government extended the deadline for cuts to 2016.

But Mr Noonan said: "The Esri's concern that it will be difficult to adhere to the 3% deficit to GDP target by 2014 is understandable.

"However, this is a futile debate because Ireland has no choice but to stick to this target."

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