Noonan abandons €2bn cuts target

Plans to push through a €2bn package of spending cuts and tax hikes in the October budget have been abandoned.

The Cabinet was told yesterday the financial situation had improved since the beginning of the year and the level of austerity could be eased off.

Finance Minister Michael Noonan said that six months of better than expected figures in tax returns would mean the Exchequer would hit the target of getting the deficit down to 3% of GDP through less drastic action.

“We thought it would be necessary to increase tax and cut expenditure by €2bn. We’ll get under 3% now by making less cutbacks and less tax increases,” he said.

Mr Noonan, along with Public Expenditure Minister Brendan Howlin, outlined to Cabinet the boost to State coffers but said they would not know how big the reduction would need to be until the September tax figures are in.

Mr Howlin said the upturn pointed to a “less demanding” Budget.

“The economy has grown, the tax revenue has increased, the number of unemployed has fallen. So these are all good auguries,” Mr Howlin said.

Fianna Fáil finance spokesman Michael McGrath called on the Government not to concentrate on the marginal rates of the tax bands, but offer a wider relief for people.

However, Irish Fiscal Advisory Council chairman John McHale warned: “Slowing the pace of deficit and debt reduction would leave the public finances more exposed to shocks that create unsustainable debt dynamics.”


Lifestyle

FOR many of us, health insurance is high on the list of financial products which that we tend to avoid changing out of fear and confusion.Money and Cents: cover all the bases for best health insurance

Anya Taylor-Joy plays the titular Emma in the latest adaptation of Jane Austen’s romantic comedy about the spoilt, meddling matchmaker who means well, says Laura HardingAnya Taylor-Joy: ‘Emma is my little monster’

Setting sail to travel the world as part of your job has a romance all of its own but for marketing manager Máire Cronin and engineer Mark Crowe it led to love.Wedding of the Week: Cruise ship co-workers Máire and Mark sail off into sunset

One of the genres that has seen exponential growth in the podcast world is the sleepcast. Open Spotify on your phone in the evening and a number of offerings are available, writes Eoghan O'SullivanThe Podcast Corner: podcasts that will put you to sleep

More From The Irish Examiner