IMF warns against pre-election spending spree

The International Monetary Fund is reportedly adding its voice to warnings of the dangers posed by a giveaway budget in December.

The current Government has a track record of announcing major spending plans in the budget before a General Election and the opposition has been predicting that Fianna Fáil will try to "buy" next year's election in just such a manner.

Several economists have already warned of the dangers this would pose to the economy and reports this morning say the IMF is now adding its voice to those concerns.

The organisation has reportedly warned that the Irish economy is becoming "increasingly imbalanced" due to a heavy reliance on the property market and rapid rises in personal debt.

It says that, instead of embarking on a pre-election spending spree, the Government should save any extra money taken in by the Exchequer due to the risk of a sharp fall in tax revenue in the coming years.

The IMF also says an "abrupt correction" to the property market cannot be ruled out, but a soft landing is the most likely outcome.