Noonan rejects claims of a giveaway pre-election budget

Finance Minister Michael Noonan has insisted new EU fiscal rules will prevent the October budget from becoming a “giveaway” pre-election deal.

The opposition parties have claimed that money will be thrown at voters to win them over.

Mr Noonan made the claim as he said his Dáil opponents were becoming “nervous” about what benefits the budget would bring to the country.

Speaking at the second day of the National Economic Dialogue in Dublin Castle — an event set up to allow the Government to hear alternative financial views — Mr Noonan said there was no risk the recovery would be thrown away in October.

Just 24 hours after ex-taoiseach Bertie Ahern denied at the banking inquiry that he “squandered” the boom, Mr Noonan said new EU fiscal rules mean while Government has money to spend, its actual outlay is restricted, a situation he said is “a good thing” because it will prevent another crash.

“I don’t think anyone who has experienced the last one wants to go through it again,” he said, rejecting fears of a “giveaway budget”.

“We’re in the position that I don’t think any Government was in before, where we actually have money to spend and under the rules we won’t be able to spend it all. So we have to prioritise when it comes to spending,” he said.

Asked specifically about opposition concerns the recovery could be misspent to ensure the Coalition remained in power, Mr Noonan said rival parties were just “nervous” about what benefits the budget would bring.

The Fiscal Advisory Council has warned that extra funds should be used to help pay off debt, not other services.

Mr Noonan said there was “significant space” for tax reductions and spending rises, and that there was no need to worry.

“I spent a lot of time in my life in opposition and you get increasingly more nervous as the election approaches, especially when you don’t know what the government have in mind,” he said.

The event was attended by more than 140 businesses, trade unions, farming, community, and political groups, who outlined what they want to see in the October budget.

Public Expenditure and Reform Minister Brendan Howlin similarly dismissed concerns of overstretching the early signs of recovery. He said “pressure points” such as childcare and pension issues would be targeted in October.

Meanwhile, opening a new sports facility in west Dublin with Sports Minister Paschal Donohoe, Tánaiste Joan Burton said what Ireland needed was “stable” and “sustainable” government.

The Labour leader said Fianna Fáil wanted to go in with “nobody”, that no one was seeking Sinn Féin’s support, and that some groups formed by independents have “just three people” — meaning none of them were a viable alternative to the current government.