Hard-hitting Budget tipped for April 2

The Government’s supplementary Budget will be unveiled the day after April Fools’ Day, it was claimed today.

Economist Colm McCarthy told the Green Party convention that the hard-hitting package of financial measures is due to be announced on Thursday, April 2.

A Government spokesman said the date for the supplementary Budget has not yet been confirmed.

The Taoiseach announced in the Dáil this week that the Government was forced to act in the national interest after he and the Cabinet viewed disastrous Exchequer Returns for February.

Mr McCarthy, who fronts the Government’s Expenditure Review Group – dubbed An Bord Snip Nua – told Green Party delegates in Co Wexford: “A new set of budgetary measures is due to be announced on April 2 and is likely to include action to contain both current and capital spending.”

In a speech entitled: Stabilising the Public Finances, the UCD academic also predicted that the total tax take will shrink by more than one quarter in 2009.

The Budget is expected to contain a combination of spending cuts and tax increases to help stabilise the public finances.

Mr McCarthy said: “The collapse in Government revenue has been spectacular.

“About three-quarters of revenue comes from taxes; the rest comes mainly from PRSI and health contributions.

“Even with the October Budget increases, tax revenue alone will be down roughly 28%, or about €13bn in 2009 as against 2007 as both PRSI and health contributions are weakening as employment in the private sector contracts.”

Mr McCarthy was a guest speaker at the Greens’ convention which was attended by more than 600 party delegates in White’s Hotel.

He added: “Given the severity of the worldwide credit crunch and the hostile sovereign debt markets, a repetition of the continuing large deficits which arose in the 1980s is not an available option.”