Exchequer figures: a lot of damage done, more on the way

“The news that tax revenues may be €500m below target this year is a clear reflection of the weakness in the indigenous economy and the Government-driven loss in our competitiveness.’

“Blame for the hundreds of job losses announced this week lies directly at the Government’s door. It was Minister McCreevy who overheated the economy, failed to manage the NDP and drove up costs. He has placed the Irish economy in a much weakened competitive position now that more difficult times have come. That the Department of Finance is now predicting a further €500 shortfall in tax revenues is a further indication of the weakness of the indigenous economy. Employment in manufacturing industry is now more than 7000 lower than in September 1997, when this Government took office.

“No lessons have, however, been learned, as the Government continues to under-spend on vital infrastructure. Capital spending in the first six months of this year is €372m below target, despite cuts in planned spending. The Government is continuing to undermine existing and future jobs by a combination of incompetence and a misguided homespun ideology that ‘you can only spend it when you have it’.

“On current spending, the post-election squeeze is continuing. That spending is running at €738m below profile, despite timing factors, is a clear indicator of the severity of the cuts being made. The impact is being felt by vital services, including health and services for people with disabilities. Cuts in current spending are both cruel and economically misguided – our claim to having a highly educated workforce, for example, will be undermined if we continue to cut back on education and labour market development. Public services are vital to the effective running of an economy, as well as being socially necessary. The stop-go approach to funding public services adopted by this Government is simply repeating the mistakes of the 1980s which inflicted so much long-term damage, particularly on the health service.
“The half-baked and desiccated thinking reflected in these exchequer figures is inflicting damage on the Irish economy which will be felt for many years to come.”