Minister for Finance Brian Lenihan expressed confidence today that the Government would have a majority to pass the upcoming budget.
Speaking to the American Chamber of Commerce Ireland, Mr Lenihan said: “I am quite satisfied from my discussions both with the parties in Government and the various public representatives in Dáil Éireann that there is a majority for the budget and that it will pass.”
His comments suggest the Government may have secured the support of Independent TDs Jackie Healy-Rae and Michael Lowry who had earlier signalled that they might not support the 2011 budget, the first in a series of four required to adjust the public finances by €15 billion.
The Government was determined to set about fixing the public finances and the banking sector, the Minister said, and negotiations with the European Union and the International Monetary Fund on a rescue fund would be concluded “in the weeks ahead”.
Good progress was being made in the discussions and negotiators were reaching “crunch issues”, he told reporters. He declined to put an exact timeframe on when the negotiations would conclude.
Repairing the banks would cost “a very definitive amount of money”, he said in his speech, and that he was confident negotiations with the EU and IMF for a rescue loan would lead to a “permanent resolution” to the banking problems.
“The external assistance that we have sought is primarily concerned with the need to stabilise this sector because this sector did grow too large for a small sovereign like Ireland to manage,” he said.
Ireland’s 12.5 per cent corporation tax rate will not be under discussion in negotiations with the EU and IMF as a condition of the bailout.
The country would have a small balance of payments surplus next year so “Ireland will be paying its way in the world”, Mr Lenihan said
“That puts Ireland in a very, very different category from those countries that have also experienced the brunt of this economic crisis in Europe,” he said.
“We have a very sound real economy. We have a real economy that is producing goods and services around the world and increasing our GDP on an annual basis.”
Earlier, Mr Lenihan told the Dáil that while the size of the EU-IMF bailout had not yet been determined, a sum of about €85 billion had been mentioned. He described the Government’s four-year budgetary plan to fix the public finances as “fair and proportionate”.
“It’s a rational and sensible plan to bring us out of this steep downturn, of which we’re starting to emerge,” he said.
