NERI questions Government plan to pursue €3.1bn adjustment in next Budget

Monday 29 July 2013 16.59
NERI said there needs to be a balance between austerity and internal economic activity
NERI said there needs to be a balance between austerity and internal economic activity

The Nevin Economic Research Institute has said the Government should not pursue an adjustment of €3.1bn in October's Budget.

Micheál Collins, senior research officer at the Institute, a union-backed think tank, said savings of €1bn on the promissory note deal should be used to reduce the Budget to €2.1bn.

The Government's Fiscal Advisory Council, the IMF and the European bailout fund have all said an adjustment of €3.1bn is necessary.

Mr Collins said the Budget should focus on growth and recovery, and that taking more money out of the economy will dramatically reduce spending.

He also said there is a need to balance austerity with some level of internal economic activity.

Meanwhile, employers' group IBEC has repeated its call on the Government to drop any plans to increase taxes in the Budget.

Elsewhere, Minister for Transport Leo Varadkar has said he does not agree with Minister for Social Protection Joan Burton's assessment that the Economic Management Council is dominated by a small number of people.

Speaking in Galway, Mr Varadkar said he did not have any issue with how Cabinet sub-committees are organised.

He said having all Cabinet ministers on all sub-committees would be to the detriment of good governance.

Ms Burton is quoted in today's Irish Times saying the EMC did not see the "big picture of the Irish economy".

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