Quinn seeking cuts of £200m in estimates as spending rises

THE Minister for Finance Mr Quinn, is seeking cuts of £200 million in the estimates submitted by his Cabinet colleagues for 1997.

Efforts by the Government to control public spending are failing to meet established targets and it would now seem that the increase in current spending during 1997 will amount to 4 per cent, rather than 2 per cent, in real terms.

A Cabinet subcommittee will meet later this week to consider what elements of spending can be reduced across the board so as not to jeopardise tax concessions, designed to underpin a new national wage agreement, in next January's Budget.

Spending within the Department of Health has grown considerably because of high level of awards granted by the Hepatitis C Tribunal. Home care services and expenditure on drugs for medical card holders have also contributed to the "significant overrun", according to reliable sources.

The Department of Justice has also breached the spending guidelines through the funding of additional prison spaces and the provision of additional anti crime resources. There have also been spending problems within the Departments of Agriculture and the Social Welfare.

Some of the cost saving proposals put forward by the Department of Finance would involve the elimination of a number of programmes and are said to be politically unacceptable, especially as the parties prepare to face into a general election year. In that regard, payment of the double week, Christmas bonus for social welfare recipients - at a cost of £38 million - is once again questioned. But there is no question of the scheme being dropped.

The Government is already under extreme pressure because of the rejection by nurses of a £50 million pay offer and the partial acceptance by teachers of a £70 million deal. Public service pay will rise by 5 per cent next year, without taking into account increases in any new national wage agreement, and money will also have to be found for tax reductions.

Under the Programme for Government, current spending for 1997 was not to exceed that of 1996 by more than 2 per cent in real terms. It now seems the figure will amount to at least 4 per cent. The only bright spot is that Government borrowing will be considerable lower than estimated.