Cowen warned of Lenihan 'coup plot'

Tuesday, December 08, 2009 - 06:45 PM

Taoiseach Brian Cowen was tonight warned of alleged attempts to overthrow him by a senior Cabinet minister as the countdown begins to the most feared Budget in living memory.

In a sensational claim, adding to the woes of the embattled premier as he faces into an unprecedented €4bn cost-cutting plan, it was claimed that Finance Minister Brian Lenihan was hatching a planned coup.

Labour leader Eamon Gilmore said a near deal with public sector unions on €1.3bn of the cutbacks was purposely scuppered last week as part of a behind-the-scenes plot against Mr Cowen.

“The bottom line, Taoiseach, is that you have a Minister for Finance who is now so anxious to get his hands on your job that he was prepared to sink this agreement,” he said.

In an outburst that drew breaths in the Dáil, the Labour leader accused Mr Lenihan of lacking political loyalty, claiming he had dispatched allies onto the airwaves to jettison the chances of deal once it looked likely.

“It was stupid and it was short-sighted... it is something that I believe we will all regret next year,” Mr Gilmore added.

The Labour leader said a deal was within touching distance that would have made the savings needed, reformed the public sector and secured industrial peace.

Rubbishing the suggestion, the Taoiseach insisted the top Fianna Fáil pair had stood shoulder to shoulder during the negotiations which dramatically collapsed on Friday, after reports of a deal on pay cuts.

Mr Lenihan was tonight putting the final touches to the Budget designed to steady the country’s perilous finances ahead of a Cabinet meeting to sign off on the hard-hitting measures tomorrow morning.

Hundreds of thousands of public and civil servants are expecting pay cuts ranging between around 4% on the lowest wages and as much as 20% for the top-earning elite.

The exact details of the salary reductions will be poured over by public sector unions who have threatened long and sustained industrial action after last week’s talks failed.

Cuts to social welfare payments, including unemployment and child welfare benefits, as well reduced spending on health and education will also spark controversy.

The Government has already signalled it will not make too many changes to taxes, apart from the introduction of a carbon tax expected to raise the price of petrol, coal and peat briquettes.

Transport Minister Noel Dempsey again issued the Government mantra of recent weeks and months that no-one would escape unscathed from the cutbacks.

“Everybody has to take a hit,” he said.

“It’s a tough Budget, it’s going to be difficult. We have tried to be as fair as we possibly can to everybody but I think a bit like last year it’s those who can afford most, will pay most.

“We are going to try and protect the vulnerable as much as we can but we cannot say that anyone is going to escape.”

Fine Gael leader Enda Kenny claimed that half of the required savings for the crisis Budget – €2bn – could be found if social welfare fraud was properly tackled.

“In a draconian Budget, because of Government incompetence, you are going to take away money from people who need it,” he said.

But Mr Cowen defended his anxiously-awaited cutbacks as necessary to protect social welfare recipients into the future, adding they come after years of benefits rises against dropping prices.

“We have an unsustainable public finance position and if we are to protect the most vulnerable in our society, as we must and seek to do, we must do so in a way that provides a sustainable way forward,” he said.