Fianna Fáil finance spokesman Michael McGrath has said his party is proposing an overall €2.4bn adjustment in next week's Budget.

Mr McGrath said such an adjustment would ensure the economy had the best possible prospect for recovery while adhering to deficit targets.

He said Fianna Fáil would increase the Universal Social Charge on highly-paid PAYE workers for the portion of their earnings in excess of €100,000 per annum.

He said such a move would bring them into line with those who are self-employed. He said the move would yield €70m for the Exchequer.

Mr McGrath also said that Fianna Fáil is proposing an added tax on food products with high sugar and salt contents.

The measure would aim to bring in an additional €100m.

Mr McGrath said there was a historic failure on tackling unemployment and an urgent need to rebalance policy away from passive income support towards activation measures.

He told journalists the party's proposals had not been submitted to the Troika, as the lenders had always taken the view that individual policies were a matter for the Government.

The Taoiseach has said there will be some "flexibility and adjustment" in the Budget, which recognises that many people have had "a really difficult time" over the last number of years.

Enda Kenny said the Budget will also provide some opportunity for job creation, which he said was the real key to growing the economy.

The Cabinet is to hold two special meetings before the Budget on Tuesday afternoon.

Five TDs launch joint Budget proposals

A group of five TDs have launched joint Budget proposals.

Catherine Murphy, Patrick Nulty, Tommy Broughan, Thomas Pringle and John Halligan are proposing the introduction of a wealth tax, increasing Capital Gains Tax and Acquisitions Tax to 40%, introducing a financial transaction tax and eliminating property-based tax reliefs, such as the Section 23 relief.

They are also proposing no further cuts in public expenditure and the lifting of the moratorium on public sector recruitment for frontline services.

They propose that €6 billion in the National Pension Reserve fund should be invested over the next four years to generate economic activity and employment.

Mr Nulty said there had been "a phoney war between Fine Gael and Labour" regarding the Budget adjustment, adding that austerity had been a disaster and it would be irresponsible to cut social protection further.

Ms Murphy said the five TDs had come together as they have common ground on this issue, but she said they were not forming a group like the Reform Alliance.

Elsewhere, Sinn Féin spokesperson on social protection Aengus Ó Snodaigh called on the Government to target wealth rather than cutting spending on health or social welfare.

He said: "The internal Government spat about where the axe will fall on public spending in the Budget distracts from the many other options.

"The Government parties would like people to believe that their hands are tied, but in reality there are many ways in which deficit reduction can be pursued without heaping further pain on families and strain on the economy."