Taoiseach Leo Varadkar has warned the next Government will have to make choices around spending as the deficit is set to reach 30 billion euro this year.
It comes as negotiators from Fine Gael, Fianna Fail and the Green Party met on Wednesday to discuss finance and the economy as part of talks on Government formation.
Speaking at a contact tracing centre in Dublin on Wednesday, Mr Varadkar said the country is in an unprecedented economic scenario due to the coronavirus pandemic – resulting in the 30 billion euro deficit.
“The country will spend 30 billion euro more than we make in taxes; that is borrowed money,” he said. “Thankfully because the country has been well managed and run for the past few years, we have the capacity to borrow but we can’t borrow indefinitely forever.
Thankfully because the country has been well managed and run for the past few years, we have the capacity to borrow but we can't borrow indefinitely foreverLeo Varadkar
“Every day we see a different group coming out suggesting that we provide a billion for this and 15 million for that and I understand that. But I need to be frank with people. It is not going to be possible for the State to compensate every business, sector and individual for all of the money that they have lost as a consequence of this pandemic.
“The amount of money coming in as revenue to the country has collapsed due to the pandemic and our bills are mounting in terms of welfare supports, wage subsidies and so on. So the economic picture is very difficult and choices will have to be made by the future Government.”
He said, however, he is optimistic the country can start the process of easing some of the coronavirus restrictions on Monday May 18 which will see construction and outdoor workers return to work.
“But I think the right choice is getting people back to work, businesses open and getting the economy growing again,” he said.
“I think we can get the economy growing again but, as always, choices will have to be made.”