The Chairman of the Fiscal Advisory Council has said the amount of money available to the next government to pay for tax cuts and spending rises could be little more than €3 billion. 

Professor John McHale's estimation is significantly less than the Department of Finance's figure of more than €8.5 billion of so-called "fiscal space".

Fiscal space is a measure of the maximum room for tax cuts and spending rises under Europe's fiscal rules. 

Professor McHale said that the Government should be careful about what they promised ahead of the general election. 

He said that while he can understand that winning is what an election is about, there is a fiscal cost and this could hurt the economy long term.

He said the economy does not need any incentives that would lead to an overheating situation developing

But Taoiseach Enda Kenny said Fine Gael and Labour were not "going overboard in terms of election auctioneering."

Mr Kenny said that parameters had been set out and European controls still applied. Ireland "will be on the safe side" of those controls, he said.

he Taoiseach added that details would be "spelled out" by the Minister for Finance in a long term economic plan.

Mr Kenny added that Mr Noonan's proposed stability fund would deal with the many challenges outside of Ireland that may have to be dealt with, and described it as "prudent financing."