Varadkar urges ministers not to worry people ahead of budget

Transport Minister Leo Varadkar has warned his Cabinet colleagues to stop “worrying” people with budget kite-flying.

As Coalition horse-trading intensifies ahead of the earlier than usual October financial settlement for next year, Mr Varadkar urged fellow ministers to stay quiet.

With ministers from both government parties publicly pushing budget initiatives, Mr Varadkar called for restraint. “I think it would be better if we talk to each other first rather than flying kites in the media. Last year we had ministers kite-flying about all the horrible things that were going to happen and it did worry people unnecessarily.”

The move came as Brian Hayes, the junior finance minister, played down scope for tax cuts in the budget.

With Social Protection Minister Joan Burton making it clear that she does not want to see major cuts in her spending levels, and Jobs Minister Richard Bruton insisting that any spare money should be spent on tax cuts, clear divisions are emerging within the Coalition.

Mr Varadkar warned that the public was wrongly being softened-up to expect a better budget than could be achieved in the economic circumstances.

“We have kite-flying in the other direction, raising expectations that somehow this is going to be a pleasant budget — it is not,” he told Newstalk.

“It is still going to be a tough budget that is still going to involve significant reductions in spending.”

Mr Varadkar also warned it was premature to start talking about a €1bn bonus from the promissory note deal as nobody knows what the budget figures will be.

“If tax receipts come in 1% ahead of target and spending 1% behind target we have another billion to play around with.

“If they go the other way the one billion we think we have to play around with is gone.”

Labour is keen for any extra money to be used to limit spending cuts across departments, while Fine Gael TDs believe such financial leeway should be used to ease the burden on taxpayers in a bid to boost consumer confidence.

The IMF has called for the Government to stick to a rigid economic management route so it can “safely” reach its target of reducing the deficit to 5.1% next year and 3% the year after.

Ministers have said some €3.1bn in spending cuts and tax increases need to be achieved in October, but there is a growing sense within the Coalition that extra money available needs to be used to ease austerity.