The Labour Party finance spokesman last night called on the Minister for Finance to slow the pace of tax reduction and spend more on services in the wake of the European Commission's call for spending controls.

"The Minister needs to refocus his efforts on spending on services, particularly the health services," Mr Derek McDowell said. "He should resist any suggestion that we slow down the implementation of the National Development Plan."

To achieve this, Mr McDowell said, "will inevitably mean that we must slow down the pace of tax reduction".

The Labour Party MEP Mr Proinsias de Rossa called on the government to voice any objections it had to the Commission proposals now, rather than at a late stage as, he said, happened last year. "We cannot afford another repeat of the debacle that took place under Charlie McCreevy this year," he said.