Warning as Dublin plans £1.2bn cuts

 

The Irish Government warned there is no hiding from difficult decisions that need to be taken in the interests of the State and citizens as €1.4 billion (£1.2 billion) spending cuts were outlined.

Brendan Howlin, Minister for Public Expenditure and Reform, detailed the first half of Budget 2012 with the stark assessment that the country's tax take is down one third in three years.

But he claimed that the economic crisis in Ireland has been stabilised.

"Twelve months ago we were Europe's problem. Now problems in the European and global economy threaten our recovery," he said.

Mr Howlin confirmed how spending will be dramatically reined in to balance the books - 1.4 billion euro (£1.2 billion) cuts in day-to-day expenditure and a 755 million euro (£648 million) reduction in capital spending.

As part of the savings, the public service pay bill will come down by 400 million euro (£343.3 million) next year.

The Government also set out its stall for the seven-step Action Plan for Jobs by improving competitiveness and intensifying competition in sheltered sectors; supporting indigenous start-ups; assisting their growth; attracting inward entrepreneurial start-ups; deepening foreign direct investment; developing community employment; and exploiting sectoral opportunities.

Some of the more hard-hitting social welfare cuts include changes to child benefit. While payments for the first and second child remain the same, the monthly rate for a third child falls from 167 to 148 euro, while for the fourth and any subsequent children it is being cut from 177 to 160 euro.

Mr Howlin said: "The sharp reality that this Government is facing is that the level of social welfare expenditure now in place cannot be sustained from the funding base now available. As unpalatable as it might be, we must make some difficult choices in order to contribute to the reduction of the budget deficit."

The Government will not reduce any weekly rate of social welfare payments, he said.

The vital fuel allowance scheme will be pared back with the season it operates down from 32 to 26 weeks, saving 51 million euro (£43.8 million) next year.

The one-parent family payment will also be reduced, giving headline savings of 20.7 million euro (£17.8 million), while employers will no longer be so heavily reimbursed for redundancy schemes as a special rebate is reduced from 60% to 15% to save 81 million euro (£69.5 million).

As expected, Mr Howlin revealed that the Government is to reduce the budgets of health, social protection and education by more than 1 billion euro (£858 million).

Elsewhere, the Department of Agriculture, Marine and Food will see savings of 105 million euro (£90.1 million); Transport, Tourism and Sport 45 million euro (£38.6 million); and Environment, Community and Local Government down by 34 million euro (£29.2 million).

The Government's decisions will cut public spending to 55.8 billion euro (£47.9 billion) next year compared with 57.7 billion euro (£49.5 billion) this year.

Mr Howlin said Ireland's budgetary system is old-fashioned and would also be radically overhauled, with emphasis on planning for three-year terms.

"The fact is that Ireland's traditional system of budgeting no longer works for us," he said.

"The old budgeting system that we have inherited from our past is secretive and opaque. It has not led to sustainable spending policies, to proper value for money, or to good outcomes for our citizens."

Mr Howlin, a Labour minister in the coalition Government with centre-right party Fine Gael, claimed the parties will maintain core social welfare payments including jobseeker's allowance and state pensions despite the massive cuts.

"This Government is in effect a national Government containing the two largest parties in the State. It provides the stability necessary to plan and work our way out of this crisis. It won't be easy, and we will not resolve our problems overnight," he said.

"No Government, whatever its numbers, wants to be the bearer of bad news. But our options are extremely limited. The public knows this. It is wary of those who offer simplistic options."

PA

Sport
The sun rises over St Andrews golf course, but will it be a new dawn for the Royal and Ancient Golf Club?
sportAnd it's Yes to women (at the R&A)
Arts and Entertainment
Liam Neeson said he wouldn't
tv

Liam Neeson's Downton dreams

Sport
A 'Sir Alex Feguson' tattoo
football

Arts and Entertainment
A spell in the sun: Emma Stone and Colin Firth star in ‘Magic in the Moonlight’
filmReview: Magic In The Moonlight
PROMOTED VIDEO
News
ebooksAn unforgettable anthology of contemporary reportage
Voices
voicesApple continually kill off smaller app developers, and that's no good for anyone
Arts and Entertainment
Ben Whishaw is replacing Colin Firth as the voice of Paddington Bear
tv

Thriller is set in the secret world of British espionage

Life and Style
life

News
ScienceGallery: Otherwise known as 'the best damn photos of space you'll see till 2015'
Life and Style
fashion

Bomber jacket worn by Mary Berry sells out within an hour

Travel
travelWhy Japan's love hotels are thriving through an economic downturn
Arts and Entertainment
Rapper Jay Z performs on the Pyramid Stage at Glastonbury in 2008
musicSinger sued over use of the single-syllable sample in 'Run This Town'
Life and Style
Alexander McQueen A/W 2014
fashionPolitics aside, tartan is on-trend again this season
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Volunteer your expertise as Trustee for The Society of Experimental Biology

Unpaid Voluntary Position : Reach Volunteering: Promising volunteer Trustee op...

Email Designer

£30000 - £35000 Per Annum: Clearwater People Solutions Ltd: Our client is curr...

Psychology Teacher

£110 - £130 per hour: Randstad Education Reading: Psychology Teacher needed fo...

Food Technology Teacher

£85 - £120 per day: Randstad Education Cheshire: Randstad Education are curren...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week