McCarthy: No point in 'band-aid' measures

The author of the Bord Snip Nua report today said there was no point in coming up with cost savings schemes that would merely serve as a "band aid" on the country's deficit problem.

Economist Colm McCarthy was speaking as talks continued between Government and public service unions on a proposal which would save money by forcing civil servants to take unpaid leave instead of direct salary cuts.

Speaking ahead of a pre-budget lunch address in Cork today, Mr McCarthy declined to comment on the merits of the union-backed scheme, saying the exact details had not yet been revealed, but insisted that decisions need to be taken which will be permanent, in order to reduce Ireland's deficit.

"I think we need to understand that the deficit the Government faces, and that has to be eliminated over the next say four years… that deficit is mostly of a permanent nature," Mr McCarthy said.

"It won't automatically eliminate itself through improvements in tax revenue as the economy recovers.

"To the degree that we have a permanent deficit, we need permanent measures to deal with it," he added.

"There is no point coming up with schemes that will apply a band-aid to dress up the budget figures for 2010 only."

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