McCarthy silent on ministers’criticism of report

AN Bord Snip Nua author Colm McCarthy has refused to be drawn on government ministers’ criticism of his report on Government expenditures which called for large-scale cutbacks to the public service.

Addressing a lunch for chartered accountants in Dublin yesterday, the economist said the country faced four major economic challenges in the coming months and these were to restore fiscal balance, resolve the banking crisis, restore competitiveness and the need to “deleverage the national balance sheet”.

Mr McCarthy stated that in reality the Celtic Tiger economy “had checked out about seven or eight years ago”, but “no one had noticed” as the property bubble had allowed the Government to finance itself with an unsustainable level of property transaction taxes.

He steered clear on directly commenting on criticism of his report in recent days from ministers Martin Cullen and Eamon O Cuiv or Tánaiste Mary Coughlan’s claim that some of the proposals outlined in the document “make no sense”.

He did state that the McCarthy report was “just a set of options for the Government, that’s all”.

Mr McCarthy said that due to increased unemployment Government spending was continuing to rise.

He added that health, education and social welfare made up 75% of spending and “these areas cannot be exempted if meaningful cuts are to be achieved”.

A spokesman for the 24/7 Alliance of frontline public servants said Mr McCarthy’s approach was overly simplistic. “He is looking for cutbacks in services while the demands on frontline state workers are actually increasing. The vulnerable depend on these services and yet these are the people who are expected to suffer for a crisis of others making.”