Political row over budget figures

FF claim confusion over €2.5 billion savings

Michael McGrath

Michael McGrath


A political row has developed as to whether the budget adjustment adds up to €2.5 billion, or to €3.1 billion as originally envisaged under the EU-IMF bailout terms.

Fianna Fáil spokesman Michael McGrath called on Minister for Finance Michael Noonan to clarify the exact extent of the budget adjustment being brought in by Budget 2014.

Mr McGrath said that there was a reference within the budgetary small print on Tuesday to additional savings, bringing the total adjustment to €3.1 billion rather than the €2.5 billion widely reported as the target.

He pointed to a footnote on page C14 of the budget official budget documentation which read: “€0.6 billion of the budgetary adjustment comes from additional resources and savings elsewhere. Adding all of these to the €1.85 billion in new policy measures outlined above gives a total adjustment package of €3.1 billion in 2014.”

Mr McGrath said that much of the media comment and analysis in advance of the budget centred on an alleged struggle between Fine Gael and Labour Ministers about the size of the adjustment.

“The emergence of this note within the small print of the budget should be seen in that context and raises an important question,” said Mr McGrath.

“Specifically, I would like the Minister for Finance to explain what the reference to ‘additional savings and resources’ of some €600 million means, and to confirm whether the note’s reference to a total adjustment package of €3.1 billion in 2014 is accurate.

Much-publicised claims
“The Minister should give this reassurance as soon as possible to avoid any sense emerging that people have been misled with much-publicised claims that the adjustment was reduced to €2.5 billion.”

Minister of State for Finance Brian Hayes rejected the claim there was any confusion or conflict between the figures announced on budget day and the small print in the documentation. He said Mr Noonan had made it clear in the very first page of his budget speech that the tax and spending changes for next year would generate €2.5 billion with another €600 million coming from savings carried over from last year, bringing the total to €3.1 billion.

‘No mystery’“There is no mystery about this and there is no need to look in the footnotes to understand exactly what the budget contains,” Mr Hayes said.

He added that the really important target for next year was the reduction in the deficit to 5.1 per cent of gross domestic product and the budget would actually achieve a reduction to 4.8 per cent.

Meanwhile former Fine Gael minister Lucinda Creighton has taken issue with changes in tax relief for health insurance.

“Minister Noonan told the Dáil on Tuesday that the changes in tax relief would only affect ‘gold-plated’ insurance policies. This is patently untrue and Minister Reilly has acknowledged this today, admitting that up to 900,000 people, and possibly more, will be affected by the change,” she said after the Minister had answered questions yesterday at the Oireachtas health committee.

“It is incredible that Minister Reilly did nothing to stop another Government Minister introducing a measure which makes health insurance unaffordable for thousands of families,” Ms Creighton said.

She added: “Minister Reilly seems to have completely lost control over his health budget, and has allowed finance to run amuck over his main policy priority of universal health insurance, to the detriment of thousands of families around the country.”