Belfast Telegraph

Noonan plays down Budget fears

Finance Minister Michael Noonan has moved to ease fears over another harsh Budget, claiming it will be "two thirds" as difficult as last year.

However he hinted tough measures still lie ahead, stating the Government is faced with tough policy decisions over the coming months.

The minister said a three-year plan to restore the country's economy will be published in October, giving people a better idea of what to expect from December's Budget.

Mr Noonan said: "The 2012 Budget will be about two thirds as difficult as the 2011 Budget, but of course a lot of the reasonably easy options have been taken already, so we're down to rather difficult policy decisions."

As Fine Gael's two-day "think in" came to a close in Galway, Mr Noonan signalled all will be revealed when the Government publishes its budgetary strategy next month. He added: "Anybody with a reasonably good knowledge of what's going on will have a very good idea of what's up ahead after that comes up."

Taoiseach Enda Kenny would not be drawn on previous promises of no new taxes or cuts to social welfare, but reiterated the Government would have to find up to four billion euro in the Budget to meet IMF/EU targets.

"But it's impossible to put an accurate figure on it as we're speaking here, because obviously you don't have all the tax returns in for the end of the year and you can't determine what the precise level of growth will actually be for the economy," he said.

The IMF said the Government is on track to meet its targets this year as it continues to implement its bailout programme, but it downgraded economic growth projections from 0.6% to 0.4% for this year. The Government is expected to revise its growth projection of 0.8% when it publishes its three-year plan.

In its latest report on Ireland's progress, the IMF said the cut in the country's interest rate will help it repay its debts, but stressed more was needed to restore the confidence of international money markets.

Fianna Fail said Mr Kenny's refusal to rule out tax increases and social welfare cuts from the Budget will spark alarm among the public. Michael McGrath, finance spokesman, said: "These were promises first made at election time, were then included in the Programme for Government and were reaffirmed by the Taoiseach and Tanaiste on the Government's 100th day in office. However, the Taoiseach was less than clear on the status of those promises."


From Belfast Telegraph