TAOISEACH BRIAN Cowen did not rule out a mini-budget when pressed on the state of the economy.
He said that Minister for Finance Brian Lenihan had been pointing out very clearly, as he should, his determination to stick to expenditure targets.
"He said that he is satisfied the expenditure targets set out by the Government will be met and that he is also satisfied that if further action is required, it will not be taken until the next budget," he added. "That does not necessarily mean a mini-budget." Mr Cowen said that the Budget's taxation measures would be set out in the Finance Bill.
"Obviously, if further expenditure control measures are required, they will be adopted," he added.
The Taoiseach was replying to Fine Gael leader Enda Kenny who said Mr Cowen had accepted that the Budget figures were right in respect of the 2010 budget, but the economic directorate said there was a difference of €5 billion and Mr Lenihan said there would be further cutbacks.
"Is this evidence of a major split between the Taoiseach and the Minister for Finance?" said Mr Kenny. Mr Kenny suggested that the "final nail in the coffin" of the Budget was the report of the directorate-general for economic and financial affairs of the European Commission.
"The document singles out Ireland and . . . states that the Taoiseach's budget and projections are miles off course," he added.
"How does he explain the difference of €5 billion in the projections of the Minister for Finance and the Government for 2010 and those of the directorate-general, which is a participant in the legal process involved ?"
Mr Cowen said that the Government stood over the Budget figures. He added that the forecast for the Irish economy, published by the commission yesterday, was broadly in line with that of the Department of Finance, which underpinned the Budget.
The European Commission, he said, was forecasting a negative GDP growth of 1.5 per cent this year and that the economy would contract by a further 1 per cent next year.
It was also forecasting a fall in the rate of the harmonised index inflation figure in Ireland over the coming months, with further easing expected in 2009-10.
"These forecasts are broadly in line with those published on Budget day," Mr Cowen added.
On the budgetary position, said Mr Cowen, the commission noted that Ireland's expected deficit of 5.5 per cent of GDP this year largely reflected the large tax shortfall. The commission expected the deficit to widen next year to 6.75 per cent of GDP and 7.2 per cent in 2010 on a no-policy change basis.
Mr Cowen said the commission shared Ireland's optimism in respect of a return to growth in 2010.
He said that there was no difference between the Minister for Finance and himself, or anyone else in the Government, on budgetary matters.
