The Taoiseach has defended his Government's first Budget as a "Budget for everyone" and not one for the rich. Mr Ahern rejected Opposition criticism, including that of the Labour Party leader, Mr Ruairi Quinn, who described the provisions as combining "economic madness" with "political selfishness".
Mr Ahern denied that the Budget would overheat the economy. "The elimination of general Government borrowing and tighter control of expenditure is an antidote towards overheating," he said.
"The reduction in personal taxation will moderate pay demands and so help to keep employment high. The restriction of tax reliefs and their better targeting are designed to ensure that the really wealthy pay more, not less, tax."
Describing the Budget as "historic", the Taoiseach listed some of the benefits, including keeping the increase in current expenditure below 4 per cent. He said the broad tax and social commitments of Programme 2000 over three years would be delivered by the second year, "thus keeping faith with the social partners". In addition, tax on the business sector was being reduced, "so we can maintain our competitive edge".
The net numbers of people at work were increasing by an average 50,000 a year in 1997 and for 1998, "which is an absolutely remarkable figure by previous standards".
He added: "While the highest absolute gains will always be to the better-paid, as any recent Budget will show, I am quite satisfied that, viewing it as a whole and not selectively, there is equity in this Budget, that the needs of the less well-off and the low-paid are being attended to.
"Naturally, we have not been able to do all we would like. But we have fulfilled at least half the items from the agreed list of priorities for our first Budget, issued on June 4th, 1997."
This did not impress the Labour leader, who said he was "deeply and passionately angry" at the "most socially divisive Budget we've seen in modern times". He told the Government not to be "fooled by the short-term popularity and favourable comment" of those whom the Budget favoured.
Mr Quinn also claimed that "Luas is dead". He said the death notice for the Dublin transport system was hidden in the myriad figures of the Budget.
He said the Minister for Finance, Mr McCreevy, was budgeting for a drop of £40 million in capital spending in 1999, which left no room for the Luas project.
"Somebody in your Government is going to have to come clean and proclaim the death of Luas," he said. It had been "wilfully and deliberately sabotaged" by the Minister for Public Enterprise, Ms O'Rourke, in the "spurious and totally misleading statement that the underground option was not looked at".
He compared the Budget to Fianna Fail's 1978 Budget which, he said, the nation spent 15 years paying for. "The 1998 Budget threatens to repeat the history of that tragedy, not just as farce but as tragedy again."
A golden opportunity "to create equity in the tax code has been lost. The chance to help the low-paid feel that they were rewarded for working rather than staying in welfare has been spurned. You don't need a calculator to quickly figure out that pay-back time has indeed arrived for the rich, while the low-paid, at best, simply mark time."
He said that capital gains tax was to be specially rewarded.
"The message is - switch your activity from work and enterprise, where you will pay 46 per cent at the margin, and, instead, start dealing in property and shares and pay 20 per cent and pay no PRSI or levies either."
He said there was "no margin for the unexpected" - like the impact of the troubles of the Asian tigers and Japan - on the Irish economy. He said this was why the Budget was "reckless". The financial markets "now expect more, and so will the European forums where Ireland will be judged in the new single currency".
