The Tanaiste, Ms Harney, has moved to reaffirm the Government's commitment to Europe, stressing that now is the time to "move on" following the criticism by EU finance ministers last week of Ireland's budgetary policy.

European Commissioner Mr Pedro Solbes - who spearheaded Europe's opposition to Ireland's economic approach - also sought to play down the differences between Dublin and Brussels, stressing that Ireland had made "remarkable progress".

At the National Euro Conference in Loughrea, Ms Harney said it was time to "move on together on the wide range of our shared goals including economic stability and low inflation in Ireland and throughout the EU."

However, she insisted the Government's budgetary policies were correct. "The differences in the last month over whether Ireland was adhering to one part of the broad economic guidelines was unfortunate. There will always be differing views from time to time among member-states and between member-states and the Commission. "Mature relationships within our Union can accommodate these differences of opinion. These differences do not in any sense call into question our shared commitments or the value of the processes we have put in place to achieve our shared goals."

Mr Solbes was also conciliatory in his remarks and said: "Ireland will not be damaged because of a debate." He also rejected suggestions that the recommendation from the European Commission in relation to Ireland targeted this State because of its small size or that the move involved a formal censure. "It was not a sanction but a recommendation." But he repeated that the other EU member-states would keep Ireland's budgetary policy under review.

Responding to criticism that the Government was adopting a British-style euro-sceptic stance, the Tanaiste insisted that she was not euro-sceptic but rather a euro realist.

"We want to see Economic and Monetary Union come to full reality. We would not have done so well if we were not members. Our future lies in an enlarged Europe. It has opened our minds, broadened our perspective but that does not say we must not also express views strongly and forcefully from time to time."

She added that it would be important that Ireland endorsed the Nice referendum.

Mr Solbes, who met the Minister for Finance, Mr McCreevy, for breakfast yesterday morning said the special savings plan announced by the Minister last week was a "step in the right direction". However, he added that the budgetary costing as well as the amount of money it would take out of the economy had yet to be assessed.

Mr Solbes also insisted that he and Mr McCreevy had not discussed Ireland's budgetary polices. "We have already had that discussion a number of times," he said.