CIF concerned about rise in level of current spending

The Construction Industry Federation (CIF) continues to be concerned about the rate of increase in public current expenditure. Noting that the programme for government agreed a 4 per cent nominal growth limit in current expenditure, the CIF, in a budget submission, said the aim should be to ensure that this target is met in 1998.

The main objective of Government budgetary policy should be to implement the Partnership 2000 commitment to a £1 billion reduction package comprising significant real reduction in income tax, employers' PRSI and corporation tax, according to the submission. There should also be an improvement in the "fiscal environment" for employers to stimulate investment and increase competitiveness and the Government should ensure a level of public investment in infrastructure through the public capital programme sufficient to underpin high economic growth in the medium term. In addition, the construction industry wants the provision for possible reductions in structural and cohesion funds post 1999.

The CIF cites its priorities for 1998:

A continuity of tax policy affecting the sector incorporating no changes in VAT and further progress in reducing corporation tax and PRSI.

A strong public capital programme incorporating a policy initiative to accelerate key infrastructural projects.

The introduction of the urban renewal scheme from August 1st, 1998, based on practical guidelines for its operation.

More efficient and effective planning and development systems.

The establishment of a task force on manpower training for the construction industry.

On the construction industry, the submission notes that a continuing recovery in private non-residential investment and further real growth in the 1998 public capital programme will be the primary factors contributing to construction growth in 1998. "The Government can contribute directly to the performance of the industry in 1998 by adopting a stable budgetary stance on taxation issues affecting construction investment and by providing a strong public capital programme," according to the CIF.