Cowen 'sleepwalking' on economy - Bruton

Fine Gael has attacked the Government’s fiscal management after Exchequer returns published yesterday show tax receipts in the first five months of the year are almost €1.2 billion or 6.4 per cent below budgeted levels.

The figures showed tax revenues 10 per cent, or €430 million, short of official expectations in May as the deterioration in the public finances worsened.

Fine Gael's finance spokesman Richard Bruton accused the Government of failing to protect the economy from deteriorating financial conditions and "blowing" €4 billion over the past two years.

"It's not all their fault, but there's no doubt that they sabotaged the economy's capacity to deal with tougher times by the way in which they spent way beyond the growth in the economy," he claimed this morning,.

"Effectively, they ramped up spending that yielded poor value on the back of property receipts that were plainly unsustainable," Mr Bruton told RTE's Morning Ireland.

"Now that we find times are tougher, they're saying that they can't fund vital infrastructure."

Mr Bruton said the Government had increased spending by 65 per cent more than the growth of the economy over the past two years.

In order to cut costs, he said Minister for Finance Brian Lenihan must "rationalise the quangoes and bureaucracies that have been created by lazy thinking".

He said Mr Lenihan must "get to grips with a lot of the sloppy decisions that have been made" and identify where savings can be made.

Mr Bruton said the Oireachtas Public Accounts Committee has urged the Government to begin forming its next Budget now. Otherwise, he said, the Government "is sleepwalking into this difficulty".

Taoiseach Brian Cowen has warned that elements of the National Development Plan will need to be prioritised in the wake of falling tax receipts. He told the Dáil last week that assumptions which are set out in the plan are predicated on growth of more than 4.5 per cent per annum.

"It is important that we prioritise investment to those areas which will improve competitiveness, and ensure we continue to see investments coming to the country to create jobs and maintain and grow wealth for the country in order that we can develop public services," Mr Cowen said.

Mr Bruton accused Mr Cowen of "eating his own words" on the NDP.

"This is the Taoiseach who lectured everyone about the NDP being the priority, that it would be delivered in full, on time and on budget," he said. "If he had not spent the money that he has spent in the last two years on day-to-day spending trying to win the election, we would have €4 billion extra available to spend on capital projects. He blew that money."

However, he agreed that the Government needs to focus on infrastructural projects to improve Ireland's competitiveness.