Continued heavy investment is needed in health, education and social welfare, the Minister for Finance told the ardfheis. However, he said, Fianna Fβil was "not about throwing money at problems, we are about reform".
Signalling difficult times ahead, Mr McCreevy said he believed "that we should view the immediate future as a time for consolidation and as a time to focus on public service delivery to the most needy, lest spreading limited resources more widely causes us to respond inadequately to the most critical social needs".
Delegates approved a finance debate motion that any future budget tax reductions should only apply to the lower rate and that those on £350 a week or less should be out of the tax net.
Mr Ted Fitzgerald of North Kerry, who proposed the motion said that anyone earning £350 a week, equivalent to £18,000 a year, only had £292 a week after tax. He believed that workers on £350 down to the minimum wage should be out of the tax net.
Mr McCreevy, who spoke before the motions were discussed, had defended his tax strategy.
"Some commentators, have misguidedly accused us of rewarding the well off but a perusal of the facts shows otherwise. "Cutting tax rates will always benefit those who earn more - that is a simple mathematical fact but that is no excuse for not cutting rates," he said. Some of the biggest tax advances had been made for those on low pay up to the average industrial wage, he said, adding that 300,000 people had already been taken out of the tax net as a result of his four budgets.
"We will reform services in this country and we will get value for money for you, the Irish taxpayer," Mr McCreevy said. He added: "We can hope to deliver on further service improvement - which we all want - while maintaining fiscal prudence and avoiding need to unwind any of the huge progress we have made on taxation".
Emphasising consolidation, the Minister said "the Government has invested major extra resources in public services over recent years". Funding for health had doubled. He said : "We owe it to both the public service 'customer' and to the taxpayer who funds all our services to maximise value-for-money in public service provision". He was confident about Ireland's prospects but repeatedly warned of the dangers.
"Certainly there will be problems in the shorter term, flowing from the international slowdown which was underway before September 11th and which seems likely to be exacerbated by those terrible events." Plans had been put in place for future progress "but managing this economy is not just about forward planning - solid management in difficult times requires a steady hand".
