Voters knew harder days lay ahead when voting, says McCreevy

FINANCE Minister Charlie McCreevy yesterday insisted voters knew what financial difficulties were ahead when they cast their votes in the general election.

Mr McCreevy was responding to persistent allegations that Fianna Fáil misled voters over the economy after it emerged this week that the Government will have to borrow hundreds of millions of euro this year.

This is despite predictions made earlier this year by Mr McCreevy that the Government would end up with a budget surplus in 2002.

He said yesterday he made it clear during the general election campaign there was an economic slowdown ahead and that present difficulties should not surprise anyone.

“At the Fianna Fáil press conferences there were great graphs being displayed and considerable debates over growth projections as far as 2006.

“Maybe I was wasting my time at the press conferences and the media weren’t paying enough attention. But that was all out in the public domain at the time and that’s what the people voted on.

“And I’m quite well aware that’s why the people re-elected a government for the first time in 30 years and that was a good thing.”

Mr McCreevy also rejected allegations from some economists that he has mismanaged public finances. and that all European countries were experiencing a slowdown.

“I’ve heard this a number of times and I reject totally those assertions,” he said.

“Exchequer finances for this year will show a deficit. The main reason for that is there will be at least a 1.3bn deficit in terms of taxes to be collected.

“I would point out that figures show Germany, France, Austria and the Netherlands are also experiencing, without exception, a decline in their tax revenues,” he said.

The Economic and Social Research Institute (ESRI), the State’s economic think-tank, this week laid much of the blame over the state of the public finances with Mr McCreevy.

He will be forced to borrow for programmes such as the special savings accounts and the pension reserve fund. Meanwhile the Department of Health may end 2002 almost half a billion euro in the red. ESRI said it fears the national debt could rise by 3 billion next year.

But the minister said the economy was still healthy and pointed out there was a projected current Budget surplus of 400m this year.

Overall, however, there would be a projected 750m deficit after major investment in infrastructure and capital projects was taken into account.

He said the amount spent on capital projects had increased five-fold since he took over as Finance Minister.

The minister was speaking before a Nice Treaty meeting in the Irish Financial Services Centre, where he was mobbed by students angry over reports that college fees may return.

Carrying placards reading “Take your hands off our future Cutback Charlie”, they blocked his entrance into the pro-Nice meeting.

The minister eventually entered the meeting through an emergency exit and left through a back exit, leaving his Mercedes surrounded by protesters.