Budget axe to fall, but carbon only new tax

FINANCE Minister Brian Lenihan has once again ruled out raising any new taxes in his December budget, with the introduction of a carbon tax being the only exception.

He warned, however, that, given two thirds of Government expenditure went on public pay and social welfare, the axe would have to fall in these areas.

The Government is committed to finding savings of €4 billion in the budget on December 9. And its own think tank, the Economic and Social Research Institute (ESRI), said last week that €3bn of the savings should be found through cutbacks in public sector pay and a 20% cut in child benefit.