THE CABINET is to hold two meetings today and three further meetings before the end of the week in a bid to put a shape on next month’s budget, which needs to raise up to €6 billion in tax increases and spending savings.
Ministers will decide finally on the agenda for this week when they meet this morning in Government Buildings, but they are to meet again this afternoon and, probably, on Thursday, Friday and Sunday.
Final decisions will not be made until April 1st or April 2nd, after the exchequer returns for the first three months are known and in time for printers to prepare for the publication of the budget on April 7th.
Savings in the social welfare budget – which is escalating in size because of the rapid growth in unemployment – of up to €1 billion are now expected, possibly from changes to children’s benefits and further reductions in the childcare allowance.
Fianna Fáil TDs will tonight be briefed on “the economic outlook” by Minister for Finance Brian Lenihan’s new special adviser, University College Galway academic Dr Alan Ahearne.
The party’s TDs have already strongly urged Mr Lenihan not to repeat the mistakes made in last October’s Budget, when he attempted to wrest medical cards from higher-income old-age pensioners, which led to a national revolt.
Last week Mr Lenihan was strongly pressured by parliamentary party colleagues to leave the carers’ allowance alone, although one TD is understood to have suggested that all benefits – bar those given to OAPs – should be cut by 5 per cent.
There was still some irritation evident yesterday towards Minister for Agriculture Brendan Smith, who blundered when he said on RTÉ's Week In Politicsprogramme that the Government would have to seek between €5 billion and €6 billion in cuts.
Green Party leader John Gormley said it would be wrong to speculate on the overall savings being sought by the Government in the budget.
Mr Gormley said that Mr Smith had later clarified that no figures had been agreed by Government at this stage.
Speaking at the launch of Senator Deirdre de Búrca’s campaign for the European Parliament, Mr Gormley said: “I have made it very clear that it is wrong at this stage to speculate. As soon as you give a figure people are out with their calculators and looking at the implications for those costings.”
Mr Gormley repeated that the country was at a crossroads and faced grave economic realities. However, he insisted the Government would be prepared to take unpopular decisions for the common good.
He added that the Government would adhere to the commitment given to the European Commission that the State’s borrowing requirement would not exceed 9.5 per cent of the General Government Balance.
“We are sticking to the 9.5 per cent. There’s no question about that. We have already reneged in relation to the 3.5 per cent. We have to make courageous decisions in relation to expenditure cuts even if it is unpalatable and is not politically popular. We will deal with taxation measures as well.”
However, his colleague, Minister for Communications and Energy Eamon Ryan argued that people should not become obsessed with one figure. “The key thing is that over the next four years we get this country through a very difficult economic situation,” he said.
“There are factors in our favour. The fact that interest rates are coming down . . . The fact that oil prices are down is putting money into the country. The fact that we are spending less may be difficult for tax revenues but the fact is we are keeping money in the country.”