THE LEADERS of the four biggest parties in the Dáil will meet today to establish what common ground exists in response to the crisis in the public finances.
The talks will be chaired by Taoiseach Brian Cowen who said yesterday that he wanted to take the views of the Opposition parties into account in the preparation of the Government’s four-year budget plan.
Mr Cowen said he had invited Fine Gael leader Enda Kenny and Labour Party leader Eamon Gilmore to meet him and Green Party leader John Gormley “to confirm the extent of the agreement between parties on the necessary response” in the light of the briefing the parties received from the Department of Finance.
The Taoiseach said confidence in the economy by investors and lenders would be influenced by shared understanding and commitment within the Irish political system. He added that this did not diminish the importance of legitimate difference and the respective responsibilities of Government and Opposition. “I am very anxious that the views and proposals of the Opposition parties should be considered fully in the preparation of the multi-annual framework and this is an issue which I will discuss further with the party leaders tomorrow,” he said.
Mr Cowen added that in the circumstances the expectations of the public required that the party leaders identify in the national interest the degree of consensus that could be achieved in dealing with the challenging period ahead.
However, Mr Kenny and Mr Gilmore were subsequently sharply critical of the Government. “This party will play its part in responding to this national crisis and we will produce a response to it. But we will not do so on the basis of what the Taoiseach tells us anymore because every figure produced by the Department of Finance and the Government has been wrong,” Mr Kenny told the Dáil.
Mr Gilmore was also strongly critical. “The Taoiseach wants the Opposition to solve the problem for him. He wants the people of the country to pay for it and meanwhile he wants to stay in office. Does he seriously expect us to agree to this?” he asked.
The department confirmed last night that it believed gross domestic product (GDP) this year would be 2.5 per cent below its projected level at the time of the last budget.
In December 2009, the Government believed that spending in the economy, or GDP, would amount to €161 billion this year.
Owing to statistical revisions to GDP for 2009 and 2010, it now believes that the figure this year will be €4 billion lower, at €157 billion.
This means that without any change in the budget deficit in absolute terms, the deficit will be higher than projected when expressed as a percentage of GDP.
The department also confirmed that its July 2010 GDP growth projection of 1 per cent has been revised downwards to “marginally” above a no growth position of 0 per cent. Servicing cost of the bank bailout at about €1.5 billion a year will add to the problem.
Minister for Health Mary Harney was emphatic yesterday that the budget adjustment over the four years would not be as big as €15 billion but she indicated that the reduction in health service funding next year could be up to €1 billion.