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Cabinet finalises Budget plans

Cabinet - Carbon tax to be only change in taxation system
Cabinet - Carbon tax to be only change in taxation system

The Cabinet has met to finalise arrangements for tomorrow's Budget, which will aim to make savings of around €4bn.

It has been signalled there will be few changes in taxation, with the exception of the introduction of a carbon tax.

Budget 2010 comes amid threats of industrial action by public sector workers over pay cuts.

Up to 250,000 public sector workers could have their salaries cut by between 5% and 6%, with higher earners possibly facing higher cuts.

The public sector unions have warned that they will engage in a 'long and sustained' campaign of industrial action if pay cuts are introduced.

There was no indication of what form that industrial action would take or when it would begin.

Talks aimed at reaching agreement on reducing the public sector pay bill by €1.3bn next year collapsed last Friday.

Independent TD Jackie Healy-Rae has confirmed he will be supporting the Budget after reaching agreement with Government officials on projects for his constituency.

Deputy Healy-Rae said the most important of these was a new 42-bed hospital for Kenmare.

He said he knew much of what would be in the Budget and that it would be unpopular but he said he was committed to supporting the Government.

Elsewhere, Galway West TD Noel Grealish met Taoiseach Brian Cowen in Dublin today as uncertainty remains over whether he will support the Government in a vote on the Budget.

The former member of the Progressive Democrats and now Independent deputy wrote to Mr Cowen last week to seek a special deal on local projects in his constituency in return for his support.

The meeting ended just before 9pm, afterwards Mr Grealish said there would be a further meeting with the Taoiseach tomorrow.