A TEAM of European Commission officials visited the Department of Finance in Dublin this week for talks on the four-year budget plan due to be unveiled in a month.
There is intensive EU scrutiny of the Government’s efforts to bring the budget deficit under control by 2014, with each line of the proposal emerging from Dublin being examined in minute detail in Brussels.
Commission desk officers with specific responsibility for Ireland and other officials travelled to Dublin for discussions on elements of the plan.
However, both the Government and a well-placed commission official stressed the talks were routine and had happened in previous years.
Each said there was nothing out of the ordinary in such meetings, describing them as a matter of routine when EU member states prepare their budgets.
They also maintained the commission had not sent a dedicated “mission” to Ireland to discuss the budget proposals. “In the run-up to any budget, the commission would be over,” Mr Lenihan’s spokesman said.
Similarly, a senior commission official said the commission was not negotiating the plan and added Brussels was not directing the process. “We are in close contact but close contact doesn’t in any way mean we are participating in the drafting of the multi-annual plan,” the official said.
As the emerging plan is reviewed in Brussels, the impact of each tax and spending measure is being calculated according to projections for economic growth and inflation.
Despite inevitable pressure on the Government over cutbacks and tax rises, the aim is to produce a plan that is convincing enough to re-establish market confidence in Ireland, as it grapples with the challenges of the deficit and the banking situation.
The four-year package is due to be unveiled in a month but euro zone finance ministers are likely to receive an update on the preparations next Monday in Luxembourg at their monthly meeting. “It is obvious that the Irish situation will be discussed,” said a source close to Belgium’s rotating presidency of the EU.
The source said such meetings of the euro group ministers were informal and were typically used as a forum for discussions about countries that have particular problems at any given moment.
Although investor pressure on Ireland has eased somewhat in the weeks since the Government temporarily suspended its borrowing programme, officials in Brussels say the Irish situation remains very serious, with weak euro countries prone to attack on the markets.
The talks come as the EU executive awaits the final rescue plan for Anglo Irish Bank, which the Department of Finance may not submit until the week after next.
On Monday, finance ministers will attempt to reach a deal on new measures to strengthen the EU’s economic system, as European Council president Herman Van Rompuy prepares a report for a summit of EU leaders on Thursday week.