The Minister for Finance, Mr Cowen, last night sought to play down expectations of a significant increase in public spending in the forthcoming budget, saying higher tax revenues available to the Government this year are a "once-off" phenomenon.
He insisted spending on public services would be kept "at a sustainable level" for the foreseeable future. He said resources would be aimed at health, education and social welfare, while capital investment in infrastructure would also be kept at a high level.
Mirroring the approach of his predecessor, Mr Charlie McCreevy, to spending on public services, he said: "I am determined to get better value for money for the major levels of expenditure we are providing. It is initially important that we focus on our existing levels of activity, prioritise our work and seek better outcomes in the delivery of these essential services for the people."
Speaking in Dublin, Mr Cowen conceded that "this year the public finances are looking more favourable than at Budget time last December". But he said a significant proportion of the higher revenue seen over recent months "results from the work of the Revenue Commissioners in pursuing bogus non-resident accounts and closing offshore tax shelters. This revenue is once-off and will not be available to finance an expansion of public expenditure programmes on an ongoing basis", he said.
"I must caution against unrealistically high expectations in regard to the potential for increased public spending", he went on. He said it was necessary to avoid undermining long-term growth in output and employment, and to avoid inflationary pressures.
Urging the completion of reforms in the public service, he said he was "looking for renewed momentum in every part of the public service to improve the quality and standards of what it delivers to the people. The modernisation agenda is far from being completed.
With continuing resources must come continuing reforms. The commitment to delivering higher standards, greater efficiency and better value for money must become embedded in the culture of providing public services."
He was speaking at the Business and Finance Person of the Year Awards. Mr Dermot Desmond won the title, with Intel Ireland winning the company award.