EU wants tougher spending cuts in Ireland

The EU Commission has warned that the Government's spending cuts need to be more severe than planned.

It has described the programme that sees €3bn in cutbacks next year and a further €3bn in 2012 as overly 'optimistic'.

The report, prepared for the Economics Commissioner, Olli Rehn also said our five-year strategy needs to be strengthened.

In the formal report on the finances of the individual EU states, the Commission said tough Irish budgetary plans may not be tough enough.

It has warned that, given the likely need for further support for the financial sector, the debt ratio could be higher than planned.

The Commission is predicting a growth in the Irish economy of 2.6% next year, however the Irish Government is basing its spending plan on 3.3% growth.