Fine Gael has published a framework for economic development which will underpin its policy programme if it is returned to government after the coming general election.
The main elements of the document provide for a 9 per cent increase in current spending (2 per cent over real GDP growth, plus inflation); the possibility of borrowing for capital projects; the appointment of a senior minister to ensure targets are achieved under the National Development Plan and unchanged levels of corporate, capital and income taxes.
The party leader, Mr Michael Noonan, accused the Government of squandering the boom through bad management and of allowing spending to run out of control. He argued it was time for a private-sector approach to be taken to ensure that money was well spent and targets reached. Deputy leader, Mr Jim Mitchell, said the economy, although strong, was now in mortal danger because of a failure to control current spending. Better management and a more prudent approach to the public finances was promised.
In that regard, Fine Gael promised that economic management would be driven by the need for competitiveness, growth, fairness, social justice and value-for-money. Current spending, which has grown by an average of 15 per cent over the past five years, would be cut back to a little more than 9 per cent.
Although he did not refer directly to benchmarked pay for public servants - which is due to be paid in July - Mr Noonan said that to cut spending growth too quickly would create disruption and worsen an already poor public-service environment. Because of that, restrictions on current spending would be implemented from 2003. Economic growth is expected to fund much of the party's programme during the lifetime of the next government with GDP anticipated to rise by 3.5 per cent in 2003, by 4.5 per cent in 2004 and by more than 5 per cent thereafter.
Spending on the National Development Plan will be accelerated but only after an in-depth review that will prioritise certain elements and set new completion targets. Private-public partnerships will be encouraged and necessary investment funds will be borrowed.
Details of Fine Gael's proposals on social spending and other matters will be published at a later date in its election manifesto. The exercise conducted yesterday is useful in setting out expected growth, inflation and expenditure levels for a five-year period. But, because the party has no prospect of forming a government on its own, the programme - and the party's yet to be published manifesto - will be subject to negotiations. In that regard, Mr Noonan said he was not setting an ultimatum for potential partners.