Spending cuts - Government weaves a tangled web

MOST independent observers now predict that the Government will end up with a deficit at the end of the current year, because tax returns are running well below the budget predictions, while government spending is running ahead of projections. The ESRI is predicting that the deficit will be in the region of €900m.

The Government projected a 14.5% increase in expenditure this year, but in the first six months, it was running at 23%. If it is to meet its targets, it will have to cut back on spending or introduce higher revenue charges.

They have already cut back on the drug refund scheme, as people not on medical cards have to pay more on prescription drugs.