KEY ELEMENTS of the budget were hastily revised or dropped over the weekend ahead of its first instalment, which will be delivered by Minister for Public Expenditure Brendan Howlin today.
It is understood that moves on teacher-pupil ratios in schools, child benefit and sick pay that had been leaked to the media in previous weeks were amended.
The Government will today and tomorrow outline spending cuts and tax rises amounting to €3.8 billion as part of what is expected to be one of the toughest budgets ever announced in Ireland as it tries to bridge an €18 billion hole in the public finances.
Some of the more severe threatened cuts, such as a blanket reduction of €10 a child in child benefit payments and an annual €50 medical card fee, are not now expected to materialise following last-minute negotiations between representatives of the Coalition partners, Fine Gael and Labour.
A plan to increase the pupil-teacher ratio in schools from next September has been deferred for consideration in 2013, it is understood. A move to oblige employers to pay the first four weeks of their staff’s sick pay has been “taken off the table” and is unlikely to go ahead at present.
Reductions in child benefit are now likely to apply to the amounts paid out for third and subsequent children. The changes follow a meeting of the Government’s high-level economic management committee on Friday. Highly placed sources said these mainly involved a revision of cuts which had been agreed between Mr Howlin’s Department of Public Expenditure and Reform and traditionally high-spending departments such as education, social protection and health.
Significant reductions in spending proposed to meet the adjustments demanded by the International Monetary Fund, European Union and European Central Bank as part of Ireland’s bailout will be outlined in the Dáil at 2.30pm by Mr Howlin. He will also reveal details of the Government’s comprehensive spending review, while Minister for Social Protection Joan Burton will brief the media on the impact on her department’s budget afterwards.
Minister for Finance Michael Noonan will deliver the traditional budget day speech tomorrow. Mr Noonan will set out the increased taxation measures the Government intends to impose.
In his Mayo constituency over the weekend, Mr Kenny referred to the severity of the crisis while attempting to strike an optimistic note.
“Clearly we’re €18 billion or so out of line. That problem will not go away, it won’t fix itself and it won’t be fixed by anybody from outside.
“We’re the only ones who can deal with that and that’s why the next number of budgets, during the course of this Programme for Government, which Fine Gael and Labour have agreed to, will be challenging, will be difficult but we will emerge from this as a stronger country with a very bright future.”