Budget will take Ireland out of disastrous phase, says Noonan

Scrapping of telephone allowance for pensioners, rise in prescription charges, cut in jobseeker payments

Man of the moment:  Minister for Finance Michael Noonan addressing the second day of the Fine Gael National Conference in Limerick at the weekend. Photograph: Alan Betson / The Irish Times

Man of the moment: Minister for Finance Michael Noonan addressing the second day of the Fine Gael National Conference in Limerick at the weekend. Photograph: Alan Betson / The Irish Times


The Cabinet has arrived at Government buildings ahead of a final meeting at midday in advance of the unveiling of Budget 2014 this afternoon.

Speaking to reporters on his way in Minister for Finance Michael Noonan

told reporters the budget, which will deliver €2.5 billion in cuts and taxes, would be “tough” but it would be fair and it was aimed to take Ireland out of a “disastrous phase”.

“We want to position the country to exit the bailout so we can put this phase of Irish history behind us and build the economy and build the country going forward for everybody’s future,” Mr Noonan said.

“We are always very conscious of looking at the impact on individual families,” he added. He said the Government would try to “leave people with the bulk of their take home pay”.

However, The Irish Times understands a raft of tough measures, including the end of the monthly telephone allowance for pensioners, a rise in prescription charges, a rise to 41 per cent in Dirt tax and the scrapping of mortgage interest supplement payments, will be included in the budget to be announced in the Dáil at 2.30pm.

In late negotiations yesterday, culminating with a late-afternoon meeting of the four-Minister Economic Management Council, agreement was finalised on dozens of measures that will realise €900 million in additional revenue in 2014 and more than €1.6 billion in cuts.

Some of the major adjustments were made public over the weekend.

They included the decision to reduce jobseeker’s payments to €100 for new entrants under 25 (the current cut-off age is 22), with those aged 25 getting €144. The age requirement for the full rate of €188 has been increased to 26.

A new bank levy worth €200 million to the exchequer will be announced.

It was also confirmed that that free GP care will be available to all children aged five and under, at a cost of €40 million.

The pupil-teacher ratio which looked likely to be adjusted upwards will not be changed.

Other major changes confirmed to The Irish Times yesterday include:
The scrapping of the €9.50 monthly telephone allowance to pensioners;

Dirt tax on savings interest to be increased from 33 per cent to 41 per cent, yielding €100 million to the State;

An increase in prescription charges from €1.50 to €2.50, the second successive rise in this charge;

The discontinuation of the mortgage interest supplement for new entrants from January with a phasing out of the scheme over four years (current cost is €77 million per annum).

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