20 March 2008 Edition

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ESRI predicts slowest economic growth in 20 years

Brian Cowen

Brian Cowen

Cowen challenged to spell out action

SINN FÉIN’S Economic Affairs spokesperson in the Dáil has challenged Finance Minister Brian Cowen to spell out what action his government will take in answer to last week’s Quarterly Economic Commentary by the Economic and Social Research Institute which predicts that the 26-County economy is set to grow at its slowest pace for 20 years.
Louth TD Arthur Morgan called for the protection of funding for public services and moves to boost competitiveness.
“This situation hasn’t developed overnight, as the Government would have us believe. For the last five years economic growth has been driven by domestic demand rather than by exports. This was never sustainable but the Government did nothing about it. The Government shamefully allowed the exchequer to become over-reliant on taxes related to consumption and construction.”
Morgan said that many observers were warning that a predicted slow-down in the construction sector would have serious consequences for public finances yet still Fianna Fáil was proposing a range of “unviable tax cuts”. Now the ESRI is projecting an exchequer deficit of €5.3 billion in 2008 with a further worsening to €7.5 billion in 2009, he said.
Not only has the Finance Minister failed to anticipate the impact of the construction slow-down on the state’s tax-take, Morgan said, but his administration has failed to implement any real strategy for alternative jobs for building workers facing lay-offs. The Sinn Féin TD reiterated:
“Brian Cowen needs to set out what actions he and the Government will be taking to improve competitiveness and to ensure public finances are adequate to fund public services and social protections.”

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