Finance Minister Brian Lenihan has told the Dáil the Irish people will have to accept cuts in public spending and higher taxes.
In a speech during a two-day debate on the economy, he said there was a danger that the people from whom we were borrowing would stop lending money to us if we did not act soon to live within our means. Minister Lenihan said that if action were delayed, the problems would not only remain but get worse.
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The Minister also said the endorsement of EU ministers, the European Commission and the ECB was 'of key importance' for the Government's budgetary plans.
He repeated that there would have to be a 'very significant consolidation effort' in Budget 2011, adding that the size of this would be presented in the Government's four-year plan for the public finances. Minister Lenihan said this would be published and presented to the Dáil in the next couple of weeks.
He said the plan would contain details of spending and tax measures, but would also set out a strategy for encouraging growth over the medium-term.
Minister Lenihan said the plan would also contain plans for 'wide-ranging' structural reforms in areas of the economy which the Government could control - including the tax system, budgetary procedures, spending programmes and public services.
Responding, Fine Gael's finance spokesman Michael Noonan said things were bad, adding that there was no growth, no hope and no economic plan.
Deputy Noonan said the 3% deficit target could be achieved by a €9 billion adjustment. He said Fine Gael was not buying into the €15 billion figure announced by the Government.
He also said the Finance Minister's and the Government's biggest problem was that no-one believed them anymore and that credibility had been lost.
Labour's finance spokesperson labelled the current government 'pathetically stupid' and said Fianna Fáil's pervasive helplessness was killing the country. Joan Burton also said she believed only a change of government would make the bond markets feel that Ireland is 'on the up'.
Deputy Burton also likened the Finance Minister to a gardener who, despite talk of green shoots, had not done the spade work for real growth.
