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Donohoe defends Budget 2019 after Fiscal Advisory Council critcism

The Finance Minister Pascal Donohoe has defended his 2019 budget in the face of criticism from th...
Newstalk
Newstalk

09.35 30 Nov 2018


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Donohoe defends Budget 2019 af...

Donohoe defends Budget 2019 after Fiscal Advisory Council critcism

Newstalk
Newstalk

09.35 30 Nov 2018


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The Finance Minister Pascal Donohoe has defended his 2019 budget in the face of criticism from the Irish Fiscal Advisory Council.

On Wednesday, the Council said a spending increase announced as part of the budget was not "prudent economic and budgetary management."

It said repeated failures to prevent "unbudgeted" spending increases within the year have left the public finances more exposed to adverse shocks.

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"These failures also mean that the budget balance remains in deficit rather than in surplus.

"Failures to prevent unplanned spending increases have meant long-lasting increases in spending that are difficult to reverse.

"These increases represent a repeat of the policy mistakes of the past", the Council said.

Minister Donohoe said all additional spending has been matched with changes in taxation to make sure we can afford it.

He told Newstalk Breakfast he stands by his budget, but will take the advice of the Council on-board.

"I stand over decisions that I've made.

"I stand over, for example, the rate of increase in current spending between 2014 and 2019 is 20% - if you compare that where we were during the boom between '04 and '09, the comparative rate of increase was 57%.

"So if you look at the rate of increase in spending now versus then, we're a fraction of where we were".

Asked if the spending was coming from sustainable revenue, Mr Donohoe said: "That is a question I'm wrestling with.

"What I would say is in each of the two budgets I've done as Minister for Finance, I have increased other taxes to pay for increased expenditure".

"What I've looked to do is get a balance right that I stand over.

"But what I'm also saying - I'm not going to dismiss: we have to study what (the Council) has to say and I have and I will - The Taoiseach and I talked about it early yesterday morning - and see what impact that can make in further improving our decisions in the future".


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