Budget Cuts Will Be 'Significantly' Higher

Finance Minister Brian Lenihan has said that in light of today's revelations over Anglo's €29billion drain to the economy, December's budget cuts will be "upped, and significantly".

December's budget was already believed to be gearing up for €3 billion in cuts across Government spending, but that figure is set to rise yet further as the Government struggles to bring down the spending and borrowing deficit.

In a statement released today detailing the Government's position on the banking crisis, Mr Lenihan said the economy was still on course to meet the 2014 deadline to reduce the budget deficit to 3%.

"Work is underway on a revised four year plan that will set out the annual measures required to restore order to the public finances and bring our deficit below 3% of GDP by 2014. The four year budgetary plan will be published in early November taking account of the latest economic and fiscal data," the statement said.

However, critics have called for the European installed deadline to be extended, arguing that the measures required to meet the deadline would be too brutal and trigger a futher economic slump.

The Taoiseach this morning has said people were "rightly angry" over the final estimated cost of the Anglo Irish Bank bailout but added the situation had to be dealt with.

"Were we not to deal with it, and [there are] some suggestions in the political and other quarters that you just let this go, there are huge costs, bigger costs for our country.”

In his statement today the Finance Minister said the State now had to downsize Anglo Irish Bank and Irish Nationwide to stop them becoming a systemic threat to the State itself.


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