TAOISEACH BRIAN Cowen has confirmed that end-of-year returns to be published today will show a tax revenue shortfall of approximately €8 billion.
In last October's Budget, the shortfall was forecast to be €6.5 billion. However, a decline in revenue buoyancy in November and December has led to a further increase of €1.5 billion to €8bn.
At a press conference this afternoon in Dublin officials from the Department of Finance will publish exchequer returns setting out the position in terms of revenue, borrowing and expenditure for the last year to December 31st. The latest figure of €8 billion compares with the 2007 shortfall of €1.826 billion.
No official start date has been announced as yet for this month's social partnership talks on the economic situation.
Labour deputy leader Joan Burton has called for the Dáil to be brought back early for a special two-day session on the banks and the economy. Deputies will convene on January 20th to mark the 90th anniversary of the first Dáil in 1919 and Ms Burton wants this extended by a further two days instead of adjourning until January 27th.
The forthcoming talks with the social partners are officially focused on the Government's economic recovery programme but the Taoiseach indicated strongly yesterday that all items would be on the agenda including the national pay deal.
Speaking on RTÉ Radio's This Week, Mr Cowen said: "We have seen a significant deterioration over the last three months and that's reflected in the international situation generally so the shortfall is in the order of €8 billion.
"We've indicated in the end-of-November figures that that was projected to be the outcome. We had thought before that maybe €6.5 billion would have been the gap."
On the end-of-year figures coming out today, he said: "We have seen a significant deterioration over the last three months and that's reflected in the international situation generally so the shortfall is in the order of €8 billion. We've indicated in the end-of-November figures that that was projected to be the outcome. We had thought before that maybe €6.5 billion would have been the gap. But the gap is, as I've said, of the order of €8 billion."
When it was put to him that he should tell the social partners that the pay agreement should not be implemented or should be deferred, he replied: "I've said we'll put all items on the table - that includes all items of expenditure, that full €55 billion that we're spending which is, as I've said, in excess by, next year, €15 billion or €16 billion of what we would take in, and that's based on present predictions. It is not a sustainable position for us."
He pointed out there was a public service pay-pause until October: "I don't think it helps for me to be pre-emptive at this stage of the discussion before we get into those details but it has always been available to the social partnership to review and look at all aspects of the agreements that we have." Asked if tax increases were an option, Mr Cowen said: "We're not talking about looking at that as the immediate priority."