Kenny warns of ‘tough Budget’ regardless of adjustment size

Regardless of the size of the adjustment, next month’s Budget is “going to be tough,” Taoiseach Enda Kenny warned today.

Speaking from his party's Autumn meeting in Co Laois, Mr Kenny said the objective was "to restore our economy to good health".

“If it’s a difference of €3.1 billion or €2.8 billion, the fact of the matter is, it’s never easy when you get to the last sections of what it is you have to do.”

Divisions over the scale of the adjustment have led to tensions within the Coalition, with Labour pressing for a more modest target than the original €3.1 billion.

Mr Kenny said he would call a special Cabinet meeting to thrash out details of the Budget when the Government gets hold of official data on the national accounts.

“What we do want to do is to have all of the data so that the collective responsibility of the Government can kick in here, and do this in as fair a way as possible.”

The Fine Gael leader said the Government had restored the country's integrity and international reputation, and the Budget was about "keeping on that path and maintaining that momentum".

“This has not been easy for people but we’re headed in the right direction.”

The Government is committed to ensuring Budget 2014 delivers a general government deficit of no greater than 5.1 per cent of GDP next year.

Mr Kenny insisted spending cuts and tax hikes for 2014 would be the last of the harsh austerity measures so far imposed during the lifetime of the Coalition. “This is the last of the really tough ones,” he told RTÉ Radio.

Mr Kenny confirmed there would be a Cabinet reshuffle before the next general election without going into the specifics.

"It's like the All-Ireland finals these days, when the man appears on the sideline with a placard, it's time for his replacement," he said. "It's a matter we will consider in due course."

Fine Gael deputy leader James Reilly later welcomed the news. “I think any good Taoiseach will want to keep his team on its toes at all times,” Dr Reilly said. “I think he has proven himself to be an excellent Taoiseach. This Government has performed more in terms of reform than any Government in a long, long time. “And I believe by the time our term is up, we will be seen to have delivered the greatest amount of reforms since the foundation of this state.”

Minister for Environment Phil Hogan said it is up to the Taoiseach to make appointments and he had indicated there would be a review of “personnel” around the halfway point of the Government’s term.

Meanwhile, Minister for Jobs Richard Bruton said it was Mr Kenny’s “prerogative” to reshuffle Cabinet.

The Taoiseach also confirmed the Government would consider details of a planned banking inquiry within “the next couple of weeks”. But he said he wanted to make sure it would have no impact on court cases regarding bankers that were involved in some dealings in the run-up to the country’s financial collapse.

Speaking at a dinner last night, Mr Kenny has said the Government will run its course and said the next election would be in March 2016.

He said: “In March 2016, the people can judge us as to whether or not we have delivered on the mandate given to us . . .It’s only 132 weeks away, or whatever it is.”

Mr Kenny said next month’s budget must send a signal of stability to the international community as Ireland exits the bailout in December. He also dismissed talk of tension within the Coalition over the budget as “speculation”.

He was speaking after Minister for Finance Michael Noonan warned that a "tough" budget was in prospect and cautioned against slacking off on the effort to assert control over the national finances.