ELIMINATING WASTE and tackling inefficiencies in current Government spending should be the key priorities for the year ahead, Fine Gael finance spokesman Michael Noonan said yesterday in a statement on the latest exchequer figures.

However, he warned that major tax increases and cuts in the infrastructure programme, which he expected in the forthcoming budget, would be “the worst thing for the Government to do”.

Labour’s finance spokeswoman Joan Burton said the figures confirmed, “yet again”, that unless the Government could get people back to work and retain existing jobs, income tax and VAT would keep contracting.

Sinn Féin’s Arthur Morgan said the figures were another “sorry lament” for the public finances and a reflection of the “untold economic damage” being done by what he described as the Government’s failure to invest in and stimulate the economy.

Mr Noonan welcomed the fact that “the tax base appears to have stabilised”.

“The huge sacrifices made by the Irish people would now be helping to restore confidence and growth to the economy – were it not for the Government’s catastrophic management of the banking sector.”

He said he hoped the stabilisation in the tax receipts would give breathing space for the preparation of a plan to restore international confidence. “The worst thing for the Government to do in the forthcoming budget would be to impose enormous hikes in taxes and to slash its infrastructure programme. Yet all the signs suggest that is exactly what the Government is planning to do,” Mr Noonan said.

Ms Burton said: “On these figures, Ireland is heading back to 2002/03 tax revenue levels. The Government has eased off on capital expenditure, spending €942 million, nearly a quarter less than anticipated.”