Anger over Noonan's budget warning

Wed, May 2, 2012, 01:00

CONTROVERSY HAS erupted over the warning from Minister for Finance Michael Noonan that rejection of the fiscal treaty would mean a much tougher budget next year.

Opponents of the treaty accused Mr Noonan of an “outrageous” threat to the electorate, while his Fianna Fáil allies in the Yes campaign described the remarks as “unhelpful”.

Taoiseach Enda Kenny strongly defended Mr Noonan, saying that Fine Gael would not involve itself in scare tactics.

“Minister Noonan, above anybody else, has had the unprecedentedly difficult challenge of facing an economic mess that no other Minister before him ever faced,” he told journalists at the launch of the Fine Gael Yes campaign yesterday.

On his way into the weekly Cabinet meeting earlier, Mr Noonan dismissed claims that the country would still be able to access funding if the electorate voted No.

“It’s very clear on this treaty that only those countries that ratify it will have access to European Stability Mechanism (ESM) funding and there are no other funds,” he said.

“If there’s a No vote, the budget I’ll be planning for later in the year will be dramatically more difficult than if there’s a Yes vote.

“If people think that by voting No they’ll avoid further tax cuts and increases, actually a No vote will do the opposite,” he added.

Fianna Fáil, which is backing the Yes campaign, described Mr Noonan’s comments as “unhelpful” and said they would only serve to alienate potential Yes voters. The party’s Finance spokesman, Michael McGrath, said Mr Noonan and his colleagues would be far better employed selling the merits of the treaty to people rather than playing on their fears.

“The Irish people know that the budget deficit has to be closed and have shown a willingness over recent years to make sacrifices to achieve that goal. There is nothing positive to be gained in trying to frighten people into a Yes vote,” said Mr McGrath.

He said Fianna Fáil was committed to running a positive campaign which, while recognising the limits of the treaty, recommended its acceptance as the best way forward for Ireland.

“The Government needs to quickly learn the lessons from the failed Oireachtas inquiries referendum campaign. Meanwhile, we in Fianna Fáil will do everything we can to convince the people of the positive reasons for voting Yes rather than trying to frighten them into doing so,” said Mr McGrath.

Sinn Féin deputy leader Mary McDonald accused Mr Noonan of issuing “outrageous” threats to the public to secure a Yes vote.

“People should not be bullied by the Government. They should assess the austerity treaty on its content and implications for Ireland and on May 31st vote accordingly,” she said.

“The Government said it wants an open and honest debate. It is high time that they started to practice what they preach,” she added.

The Socialist Party described Mr Noonan’s comments as an attempt to put a gun to the heads of the public and force them to vote Yes.

Speaking at the launch of the party’s referendum poster campaign, Dublin MEP Paul Murphy said a Yes vote would lead to more austerity.

His colleague Joe Higgins accused the Government of using the “argument of fear” to scare voters and said that instead of offering more stability, the fiscal treaty would bring about more instability both here and across Europe.

Mr Noonan’s comments on the treaty came as the Government dismissed suggestions that senior Ministers were sending out “mixed messages” about the State’s funding choices in the event of a No vote in the referendum.

Tánaiste Eamon Gilmore said rejecting the treaty, which proposes tough new budgetary discipline on each euro zone state, would plunge Ireland into unknown territory and there was no guarantee the International Monetary Fund would provide funding.