Labour upbeat on Noonan budget comments

The Labour Party has welcomed comments from Finance Minister Michael Noonan, in which he left open the possibility of reducing the €3.1bn budget adjustment — if this can be done while sticking to the target of cutting the deficit to 5% of GDP.

A senior Labour source said the party was “encouraged” by the words of Mr Noonan, who wrote in the Irish Examiner yesterday that the size of the budget adjustment should not be decided until much closer to the Oct 15 budget date.

His comments represent a softening from the position of Taoiseach Enda Kenny, who told the MacGill Summer School last week that he wanted to “finish the job” of introducing the spending cuts and tax hikes that were signalled.