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Noonan: All cuts on the table for budget
Government ministers are refusing to rule out the possibility that Budget 2013 will include the raft of social welfare cuts suggested by the IMF in its latest review of the country’s bailout programme.
By John Walsh, Paul O’Brien and Mary Regan
The IMF report published on Wednesday recommended that the Government needed to look at means-testing for child benefit payments, taking away the automatic right to medical cards over the age of 70, and lowering social welfare entitlements. Michael Noonan, the finance minister, responded: “It is important to note that the IMF’s article 4 review is different to the work of the troika. It is overall advice and we always look at advice. But the programme for government has not changed. Everything else is on the table apart from what is in the programme for government.”
Tánaiste Eamon Gilmore also played down the significance of the IMF’s intervention, but refused to rule anything out.
Responding to Sinn Féin TD Caoimhghín Ó Caoláin, who called on him to rule out any attempt to curtail entitlements to medical cards or child benefit, Mr Gilmore said: “It’s not a case of ruling out or whatever.”
When asked whether the Government would consider cuts to child benefits and medical cards after IMF pressure, Enda Kenny said: “That’s a budgetary matter.
“The IMF are perfectly free to comment on this or any other issue that they wish. But it’s a matter for us, as a Cabinet collectively, to make our decisions about the budget and we don’t talk about that in advance of making those decisions.”
Last week, Mr Noonan said this year’s budget would be tougher than last year because “all the low-hanging fruit has been plucked”. Moreover, the troika, in its latest quarterly review of the economy, noted that there would be up to a €500m overspend by the Department of Health this year, which puts further pressure on December’s budget.
A source close to Mr Noonan said the minister’s comment should be seen as a “statement of the obvious” because of the size of the fiscal readjustment the Government has to undertake over the next three years.
The Government still has to make €8.5bn in budgetary cuts to bring the deficit within the 3.5% of GDP target by 2015.
But the finance source said no discussions have started yet on what spending cuts will be made this year.
A spokesperson for the Department of Social Protection says that the budget in December “will obviously be very tough”, but that negotiations on what areas will be affected will not begin until September.
A Labour backbencher said the party would rule nothing out, including the recommendations made by the IMF in the article 4 review. “We will take our share of discomfort, but only our share. Fine Gael will also have to take its share of discomfort and that means moving on things like tax shelters for high-income earners.”