Minister for Public Expenditure and Reform Brendan Howlin advised fellow Ministers to “be realistic” and “start settling” on expenditure limits ahead of the Budget at today’s Cabinet meeting.

Mr Howlin fired a warning shot to colleagues last week, cautioning them that their spending demands were too high.

At the post-Cabinet briefing this afternoon, it emerged that Mr Howlin had returned to the topic today.

He advised Ministers they had been given the perimeters on the expenditure side last week.

Departments have to “start settling” now in advance of bi-lateral discussions between various Ministers and Mr Howlin, who “reminded them to be realistic”.

Bi-laterals were due to start this week. Officials from the Department of Public Expenditure and Reform have been discussing various options with their counterparts from other Departments in recent weeks.

Earlier today, senior Ministers said before Cabinte the country is in the best pre-budget position in six years and for the first time in that period significant spending cuts are not required, senior Ministers said before Cabinet this morning.

Tánaiste Joan Burton said that while the country was in the best position for six years going into a budget, “careful and prudent” decisions still had to be taken.

“The money is limited. On the other hand this is probably the best situation the country has been in vis-à-vis a budget since the bank guarantee of just six years ago,” Ms Burton said.

Speaking ahead of the Cabinet meeting which she will chair in the absence of Taoiseach Enda Kenny, Ms Burton said a lot of detailed calculations were being carried out on different options.

She also stressed the importance of a housing package.

Mr Howlin also said this morning that for the first time since he was appointed to his current role he was not seeking significant cuts in expenditure.

Speaking before the Cabinet meeting he said the “economic temperature is improving” but the upcoming Budget will have to be “prudent”.

“I’ve laid out for all my Cabinet colleagues last week the total sum of money available. It’s not enormous,” he said.

“We’ll have to make rational decisions about how to deploy that small amount of money.”

Mr Howlin said fellow Ministers had queued up for “a word in my ear” after last week’s meeting.

“People feel that the economic temperature is improving, they see more people in work...but they know we are in a balancing exercise,” he said.

“We’ve bedded down recovery now. The next set of decisions are going to be prudent.”