Republic given 3 years to correct deficit

IRELAND could be given three or more years to get its budget overshoot down to 3% when the European Commission evaluates the country’s economy on Monday.

Economics commissioner Joaquim Almunia underlined yesterday that he will be flexible in applying the Stability and Growth Pact to countries that breach the rules.

Ireland’s deficit this year will be 6.5% of GDP and normally countries have to reduce their deficit by at least 0.5% a year but this will depend on growth and income forecasts.