The Taoiseach has ruled out the withdrawal and complete recasting of the Coalition Government's December Budget, as suggested by the Fine Gael leader, Mr John Bruton. Responding to criticisms that the Government and the Central Bank were now on a collision course because of the Budget's inflationary nature, Mr Ahern said he shared some of the Bank's concerns over price stability.

He did not agree with the Central Bank that they should not cut taxes when there was a large surplus. The workforce would not accept a situation where it was not going to get tax cuts and it was not going to get pay increases.