Opposition changes to plan should not add to uncertainty, warns Cowen

IF OPPOSITION parties want to make changes to the Government’s four-year budgetary plan they should “make sure they add up”, Taoiseach Brian Cowen has warned.

They should also make sure “it doesn’t create more uncertainty at a time when this country critically needs some certainty”, he added.

Opening the debate on the Government’s €15 billion four-year National Recovery Plan, Mr Cowen told the House that “what has been set out here is a realistic appraisal of what is possible, necessary and doable.

“If people say they want to make changes, they should make sure they add up. Make sure they add up – and that they do not create more uncertainty at a time when this country critically needs some certainty.”

He said it was critical for the country that “this House will rise to the challenge on December 7th next and implement the budget”, which he described as the first instalment of the four-year plan.

In that way “our people can know that we are going to go forward in 2011 with the sort of support that we need, the sort of facilities in place that are required, and then that we have a plan in which we can go forward”.

The Taoiseach added that “after all of that in 2011 we can go to the people and ask them to decide who they think should govern them on the basis of who has the most coherent policies that has the best prospect of success”.

The plan includes measures designed to reduce public spending by €10 billion, and raise an extra €5 billion in taxes by 2014. Mr Cowen said public sector pay and pensions, social welfare and programme costs each represented about one-third of total expenditure. “We have outlined how we will reduce it by €7 billion on the current side over the next four years. Some €1.2 billion will come from payroll and pension costs, €3 billion from programmes, and €2.7 billion from social welfare.”

The Taoiseach told the House the taxation system needed reform to bring in taxes of the level of 2006. “We have to reduce spends to what we had in 2007.” But this did not mean people “have to go back to a lifestyle of 25 to 30 years ago. Clearly the standard of living then was very different from this generation’s experience.”

Mr Cowen said publishing the level of adjustments over the next four years would bring certainty and stability. He said the plan would provide a pathway to economic recovery for the country.

Minister for Communications, Energy and Natural Resources Eamon Ryan appealed for “as much consensus as possible” in the Dáil. He accepted that “legitimate rage” was expressed by those asking why the taxpayer rather than the private sector should pay for everything. But he said the “private sector has taken a hit”.

About €40 billion of private-sector capital was wiped out as the banks’ value was lost, he noted. “This has affected many Irish pensioners and savers, who believed they had most secure and solid investments. For many, this was a really hard loss. It was a private-sector loss.” Mr Ryan said, “the Green Party is of the view that in the aftermath of the key tasks which we must complete, we should face the people and present our alternative strategies”.

The debate on the four-year plan continues next week.