Minister for Finance Michael Noonan last night sought to get Fine Gael's general election campaign back on track, following days of challenges to the party's spending plans.
Robustly defending the figures in the Fine Gael economic plan, Mr Noonan told The Irish Times the party was making fewer budgetary promises than either Sinn Féin or Fianna Fáil.
Fine Gael and Labour, however, have received a boost from the major international debt ratings agency, Fitch, which has upgraded Ireland's debt from A- to A – a move that will help to cut the cost of future borrowing by the State.
The upgrade is unusual during an election campaign, but reflects Fitch’s view of Ireland’s strong economic position and improvements in the public finances, the agency said last night.
Insisting Fine Gael’s plans are responsible, Mr Noonan said it would use €10.2 billion – the so-called fiscal space he argues is available over the next five years – to cut taxes, create jobs, improve services and put aside a reserve.
The term “fiscal space” has emerged in recent weeks as the shorthand reference for the amount of money the next government may have over its period of office to increase spending and cut taxes.
Controversy has arisen over the amount of money which may be available after the Irish Fiscal Advisory Council said it was only €3.2 billion.
Mr Noonan said Fine Gael's position was "consistent" with the €8.6 billion identified by the Department of Finance last October, along with the extra €1.5 billion allowed under loosened EU budgetary rules from 2018.
From the €10.2 billion, €4.2 billion will be spent on public services, €2.5 billion in tax cuts and, €1 billion on job creation.
The remaining €2.5 billion would be kept in a contingency reserve, he said.
“This means that Fine Gael is making fewer budgetary commitments than either Sinn Féin or Fianna Fáil,” Mr Noonan declared.
Seeking to exploit criticism of Fine Gael’s early campaign, Fianna Fáil leader Micheál Martin said the gap between the budget forecasts of the Department of Finance and the Irish Fiscal Advisory Council must be bridged.
Cooking the books
However, Sinn Féin leader
Gerry Adams
demanded that Fine Gael, Fianna Fáil and Labour should each withdraw their election manifestos, claiming they were all based on a lie. Each had been “caught out cooking the books”, he said.
Sinn Féin had exposed attempts to hoodwink voters. “There is no magical €2 billion . . . that has been claimed by Minister Noonan, Minister Howlin or indeed Micheál Martin.”
However, Mr Noonan, who has retreated from the €12 billion he recently said would be available, added “there will be no resources for any of the promises” if the Government’s policies are abandoned after the election.
Minister of State for Finance Simon Harris insisted Sinn Féin's economic policies "read like a checklist for economic destruction".
Saying SF was not concerned about where the money came from, he added: “They can get away with that in the North where they’ve been governing with the help of Tory top-ups but that doesn’t work here.”
