No Brussels request for four-year plan

IT IS a Government decision and not a ruling by Brussels to introduce a four-year budgetary plan to bring the deficit below 3 per cent of GDP by 2014, Minister for Finance Brian Lenihan insisted.

“There is no question of the authorities in Brussels dictating or suggesting there is a four-year plan,” he said during Dáil finance questions. He acknowledged, however, “there were intensive discussions with Brussels” but no request from the EU for such a plan. “But they are very happy to endorse” it.

Fine Gael finance spokesman Michael Noonan told the Minister “you’ve a great nerve, with a couple of months to go in the life of this administration, to commit a subsequent government to budgetary profiles for the next four years”.

Mr Noonan had asked what the new target would be in December’s budget above the original €3 billion. He said €1 billion had already been achieved through cuts in capital expenditure.

The Minister would only say that “an adjustment above €3 billion will be required next year, but it would be premature for me to go into the details about the extent of the additional consolidation required. But additional consolidation will be required.”

The €3 billion “is the indicative figure agreed with the commission and stated in the Stability and Growth Pact, but events have superseded that figure”.

He repeated that the Government was “committed” to reaching a deficit below 3 per cent of GDP by the end of 2014, and “it is important that we have a credible path to show how we propose to meet this commitment”.

“Work is under way on a four-year budgetary plan that will set out the annual measures required to restore order to the public finances and bring our deficit below 3 per cent of GDP by the end of 2014.”

Mr Noonan said if the Minister was saying he did not know what the targets were “what level of detail” did “ Brussels expect” in the four-year targets.

The Minister replied: “Brussels has not required anything in terms of this process. It is a decision of the Government to introduce a four-year plan.

“I certainly discussed the matter with the commissioner for economic and monetary affairs, Olli Rehn, in general terms, but no specific requirements were imposed on Ireland by Brussels and there is no suggestion of that.”