THE FIANNA Fail leader, Mr Bertie Ahern, has accused the Government of grossly mismanaging the public finances.

He warned that Government plans to increase spending by almost 4 per cent ahead of inflation next year will run the economy into grave difficulties.

"We've been on this course before and are now running the risk of repeating past mistakes," he said yesterday.

While the bigger than expected public spending package may pay off for the Government parties, in the short term, it was "wrong" and "irresponsible", he said.

According to Mr Ahern, the Government would have been able to find an additional £500 million in tax cuts over a three year period, if it had stuck to its own spending targets. The Minister for Finance, Mr Quinn, is expected to have up to £300 million available for tax cuts on Budget day.

But the Fianna Fail leader said the total tax package could have been substantially greater with different handling of the public finances.

After years of strong economic growth, low inflation, low interest rates and rising employment, Mr Ahern said, the Government spending plans were "quite extraordinary."