Noonan: Adjustment will be over €7.5bn

Monday 18 October 2010 22.59
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Michael Noonan - Given data concerning the State's finances
Michael Noonan - Given data concerning the State's finances
Department of Finance - Opposition briefings today
Department of Finance - Opposition briefings today
Joan Burton - Figures were 'very challenging'
Joan Burton - Figures were 'very challenging'

Fine Gael Finance Spokesman Michael Noonan has said the adjustment required in the Government's four-year plan will be 'significantly higher' than the €7.5bn figure previously mentioned.

Mr Noonan made the comment after a briefing from the Department of Finance on the challenges facing the Exchequer.

Mr Noonan, Labour's Joan Burton and Sinn Féin's Arthur Morgan were given confidential data concerning the state of the economy and the expected cost of servicing the national debt.

The briefings were ahead of a meeting between Taoiseach Brian Cowen and the Opposition party leaders later this week where plans for a four-year budget strategy will be discussed.

Sinn Féin will not be part of that meeting as they still do not accept the need to reduce the budget deficit to 3% of GDP by 2014.

Ms Burton said following her morning briefing that the figures presented were 'very challenging'.

She said the process would continue right up to the day of the Budget, because the Government would not have final figures until shortly before that date.

Ms Burton said the Labour Party would produce a credible plan, which would not concentrate all the pain on the lower and mid paid.

Speaking later on RTÉ's Six-One News, Mr Noonan said the gap in the public finances cannot be bridged without spending cuts and tax increases 'which will be quite severe'.

He said 'every man woman and child' in Ireland is going to be affected by the decisions in the Budget and 'there are no soft options'.

The Taoiseach Brian Cowen has indicated that the Government and Opposition parties should meet in the near future to identify what agreement there was on the budgetary measures needed to bring the public finances under control.

Elsewhere, the cost of borrowing for Ireland has continued to fall today.

It dropped to almost 6% having been close to 7% in recent weeks.

The development follows the Government's announcement that it would pour €45bn to €50bn to recapitalise Irish banks.

The markets have also been reassured by plans by the Government to announce a four-year plan to address the deficit, which is now in the region of €20bn.