Lenihan: Deficit must be dealt with immediately

Finance Minister Brian Lenihan has reiterated that the rate at which Ireland is currently borrowing money is unsustainable and must be urgently addressed.

Mr Lenihan made the comments following a meeting this morning with Joaquin Almunia, the EU Commissioner for Economic and Monetary Affairs.

The minister said Ireland's monetary deficit must be dealt with immediately because the country cannot keep borrowing for day-to-day expenditure.

Mr Almunia, meanwhile, said Ireland had even less room to manoeuvre in its public finances than previously expected.

The Government has indicated that it will seek to cut €4bn in public spending in this December’s budget in order to try to bring the State’s finances back to order.

Several ministers have been hinting that further public pay cuts and reductions in social welfare rates are likely to be included in the budget.