Cross-party support for plan key says Rehn
He said it was “very important for Ireland” to see cross-party support for the cuts necessary to bring the budget figures back in line with European targets.
Mr Rehn said the Government’s €6 billion target for next year’s budget was correct and should be supported.
“In the current situation in Ireland, irrespective of the party political differences which are inherent in democratic politics, it would be a great benefit [to] Ireland if a broad political support for the necessary consolidation measures and structural reforms could emerge and could be developed,” he said.
He said he was following developments in Irish politics on a daily basis and the best way to avoid any further costs being shipped onto the people was for the parties to work out a framework for economic adjustment and structural reform in the economy.
The commissioner was speaking after a 90-minute meeting at the Department of Finance where Minister Brian Lenihan briefed him on the Government’s plans to return to European borrowing targets by 2014.
Mr Rehn said he would not endorse the Government’s specific measures until they had been finalised and passed.
He said they were still a work in progress and the Government should be given the peace needed to finish its plan.
However, he claimed the €6bn figure was both correct and necessary and the €15bn aim for the next four years would be sufficient if the international markets grew as predicted.
At their meeting the two men discussed the Irish economic situation, the potential for private sector growth and the structure of the public sector.
Mr Rehn said they did not broach the issue of whether Ireland may have to access the European emergency bailout fund.
He said the best way the commission could help Ireland was to give its blessing to the severe measures that are required.
“The best way to support Ireland is to endorse convincing measures by the Irish Government and parliament in order to ensure the necessary fiscal adjustment and growth- enhancing structural reforms,” he said.
In relation to the interest cost linked to Irish borrowing, which reached a new high yesterday, Mr Lenihan said this was partly stoked by suggestions of some form of default being linked to future national bailout treaties.
He said the Government made its concerns known to French and German authorities about the effect of such commentary.
Mr Rehn said he believed Ireland could recover, as it had done in the past, because the fundamentals of the economy were good.
The commissioner said Ireland needed to ensure it got its product right and then the country could concentrate on selling its message to international markets.
Later today he will meet Fine Gael and the Labour party, as well as IBEC, ICTU and governor of the Central Bank Patrick Honohan.
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