Government plans extra 2bn in cuts
Wednesday, 14 January 2009

The Government is seeking an additional €2bn in spending cuts for 2009 in addition to those already outlined in the Budget, according to an update to its economic and budgetary forecasts.

The Government also confirmed that it expected the economy to shrink by a record 4% this year, and by another 1% in 2010, before returning to growth.
In a document submitted under the EU's stability programme, the Government said restoring order to the public finances could be done only over a five-year period, as taking action over a shorter period would impose substantial economic and social costs.
The Government said it plans to eliminate the current budget deficit by 2013, and to also bring it to below the EU limit of 3% of total economic output by the same year. The Government say

The current budget deficit this year, even after the new cuts, will be more than €9bn, almost double the Budget estimate.
The report also reveals that the Government is expecting the tax take this year to drop by another 9% to €37bn, while, unless action is taken, the Exchequer deficit will be almost €18bn, more than €4.5bn more than was forecast in the Budget.


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