Major coalition differences on debt plans

Major differences have emerged in how the coalition parties will tackle the country’s massive debt.

The Labour Party wants to focus on paying down the national debt while Fine Gael is prioritising investment instead of debt repayment.

Jobs Minister Richard Burton yesterday said the county will have to “use the flexibility of EU rules” to make up for a decade of under-investment.

However, Tánaiste Joan Burton said paying down debt is “the sensible way to do things”.

“My commitment is this: Over the next five years, we will exceed our debt reduction targets. So that debt never again overwhelms us, as it did when Fianna Fáil were asleep at the wheel,” she said.

Speaking at the launch of Fine Gael’s jobs plan Mr Bruton said that it would not be wise for Ireland, which now has a significant need for investment, to devote all its resources to debt reduction. Instead he said it would be better to “invest in the assets that will grow your economy and grow jobs”.

“We are a developing economy. We need to use the flexibility of EU rules to develop our economy. So those rules are fail-safe mechanisms to protect Europe and national governments.

“We have the youngest population in Europe, we are in a growth phase, a recovery phase, we need to invest in infrastructure to underpin that. We have gone through nearly a decade of under investment so we have to use the flexibility of EU rules to deliver our need of our people.”

He said from the end of 2017 the county would “not be borrowing a cent”.

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Mr Bruton said: “There will be no more growth in our debt after that and we will be paying down debt from various sources, sometimes from the realisation of assets from the banks or sometimes from the rainy day fund we are establishing.”

He also promised a job for anyone who wants one within the next four years. Mr Bruton he said the jobs target set by the Government during its last term would now be doubled to 200,000 extra jobs by 2020.

The minister said: “The opposition and the media scoffed at us when we set a target of creating 100,000 new jobs by 2016 and we have already reached the figure of 136,000 with most of the year to go.”

He said €4bn of extra funds would be ringfenced for a new future jobs investment fund to “future-proof the economy and our jobs plan against rising global risks and challenges”.

Asked about Labour’s plans to increase the minimum wage by €2 an hour Mr Bruton said: “My ambition would certainly be to deliver that sort of progress.”

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