Departments warned over spending demands

Government departments have been warned against having unrealistic spending expectations for the budget as the Public Expenditure Minister, Brendan Howlin, said there is a lot of “pent-up demand” to fund services.

Government ministers also ruled out changes to Irish Water and the utility’s charging regime.

Speaking in Wicklow at the Labour party’s think-in ahead of the Dáil’s return next week, Mr Howlin indicated there was minimal wriggle room to spend on improving services in next month’s budget. His department is expected to get half of the €1.5bn budget spend to put towards services.

Despite reports of a €200m childcare package and funds to increase the numbers of gardaí, teachers, and nurses, he refused to be drawn on the Coalition’s priorities.

Public Expenditure and Reform Minister Brendan Howlin at the Glenview Hotel in Co  Wicklow for the first day of the party’s think-in 2015. Picture: RollingNews.ie

“There’s a lot of speculation out there, there’s also a lot of pent-up demand,” said Mr Howlin. “This year we’re now reading expenditure expectations, obviously which all can’t be realised.”

Mr Howlin also firmly ruled out a significant portion of the budget going on gaps in health spending, amid reports that the HSE needs an extra €1.9bn to fund services.

“The notion that there is fiscal space for €1.9bn additional spend in any area — [it] is not available,” he said.

Environment Minister Alan Kelly ruled out any changes to the water charges regime in the budget.

Labour deputy leader and Environment Minister Alan Kelly at the party’s pre-Dáil  think-in yesterday. Picture: Collins Photos

He welcomed the latest Irish Water figures, which show that half of homes have paid their water bills. The company had said only 43% had paid bills earlier this summer, but an extra 100,000 homes have now paid up, bringing the compliance rate up to 51%.

Mr Howlin said he had considered alternative plans for Irish Water put forth by others, including Fianna Fáil, but these would not work.

It would be “disastrous” for water services and a clean supply if they were handed back to local authorities, as suggested by some, he said.

Any suggestion that Irish Water should be fully controlled by the State would also preclude private investment in services, he added.

Meanwhile, Tánaiste Joan Burton has confirmed the Christmas bonus for welfare recipients and pensioners will be partially restored, where individuals will receive an extra €115 and couples will get €220 in December.

However, this will not form part of the budget. Instead, the increased amounts will be factored into spending this year and recipients will receive their bonus a week before Christmas.