Tánaiste warns €4bn of cuts will be sought in next week's budget

THE TÁNAISTE, Mary Coughlan, yesterday reiterated the Government’s intention to make cuts of €4 billion when the budget is announced next week.

During tetchy exchanges with the Opposition, Ms Coughlan rejected claims of division between the Taoiseach and the Department of Finance, following comments in a radio interview by Minister of State Conor Lenihan.

“Unfortunately people do not seem to hear what we have been reiterating ad infinitum, which is that there will be a €4 billion adjustment in the context of the budget on Wednesday next,” Ms Coughlan said.

She told the Dáil that “all matters during the preparation of a budget are for discussion among Cabinet Ministers. They are not matters for discussion on the public airwaves.” But she wanted to “make it very clear that a basis for agreement will only exist if the scale of the reduction in the public service pay is sufficient, it is clearly seen to be permanent in character, and that any transitional arrangements do not impact negatively on services as assessed by the public service management”.

Labour leader Eamon Gilmore had said the Government’s position on talks with the trade unions was “very muddled”. It was an “extraordinary situation” that Conor Lenihan, “who was presumably acting as a proxy for his brother, was on radio contradicting the position which was set out by the Taoiseach in the House yesterday”, he said.

Fine Gael leader Enda Kenny described the Government’s approach as “one of paralysis and inaction”, and said that just six days before a “crucial” budget “we heard a Minister of State say that the Government is waiting for new ideas from the trade unions”. He said that while it was “in order for trade unions and their representatives to negotiate with the Government, it is the Government’s responsibility to make decisions. But the Government is paralysed.

“There is no confidence, no morale, and a wave of depression through the country because the Government has no fix on the future.” He asked whether the Government had set a deadline “as to when this uncertainty will conclude in the context of discussions with the trade unions”.

Ms Coughlan repeated the Taoiseach’s comments on Wednesday that the proposals “did not in their present form provide a basis for the Government to confirm that it would not consider other options to effect those necessary savings”.

She said talks with unions were continuing. “Time is very short in the context of the budget so these discussions will be crucial.”