Howlin once more calls for deferral of tax cutting plans

Labour Leader Brendan Howlin has described the phoney battle between Fine Gael and Fianna Fáil over the forthcoming budget as bizarre. He said it was not too late for the Government to postpone tax cutting plans, and reiterated the Labour view that such tax cuts simply cannot be afforded this year.

“Never before in normal times have we seen a Government already spend all the cash available to it before budget day.

“In fact as the Budget Oversight Committee has already pointed out the Government doesn’t have enough fiscal space to fund its pay commitments for next year. That’s before social welfare, education and health needs are even considered.

“The Taoiseach, presumably on the advice of his expanded communications team, has been going around over the last few weeks saying that the Government will be able to increase spending and reduce tax cuts. This is entirely disingenuous. The increased spending he is alluding to is simply required to meet existing pay commitments and demographic pressures. In truth, he has created expectations around budget day that can’t be met.

“The position in health is particularly acute given the Government suggestion that any overspend this year will be a charge on the estimate next year. The Department of Health has relied on half a billion per year increases in recent years – delivering an effective cut to their budget for next year is a recipe for total chaos in the system. If the Government proceeds as intended Health will not even be in a position to meet basic demographic pressures next year.

“As Health Minister Leo Varadkar demanded additional resources for health. Now that he no longer has direct responsibility for health, he seems happy to leave Simon Harris swinging in the wind.

“Meanwhile, we have seen an entirely phoney and manufactured ‘debate’ between Fine Gael and Fianna Fáil over tax cuts. Over the last 24 hours, this debate seems to have reached an inevitable conclusion – Paschal Donohoe will make some adjustment to income bands, and some adjustments to USC, and both parties will be happy. But by delivering tax cuts worth somewhere between €2 and €4 a week, our public services will be deprived of much needed investment.

“10 years after the fiscal crisis began, the Government has contrived to once more create a dangerous and damaging position as we approach Budget Day. It is no wonder the Independents are worried.”