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THE EUROPEAN Commission is preparing to extend by one year the Government’s deadline to restore stability to the public finances, a move that raises the prospect of swingeing cutbacks and taxation measures continuing into the middle of the next decade.

Although trade union leaders have called on the Government to ease spending cutbacks by extending the duration of its recovery programme beyond the current target of 2013, the commission will not give the Government any additional headroom as it seeks to impose €4 billion in cutbacks in the budget next month.