The Taoiseach has told the Dail that cuts in the social welfare budget, along with reductions in the public pay and pensions bill form part of December’s budget.

Brian Cowen said its time that politicans from all sides acknowledge
the scale of the difficulties which must be addressed in the budget.

He said it was not realistic to suggest that certain areas of public spending could be immune from cuts in December.

The Taoiseach said every area of public spending would have to make a contribution towards addressing the crisis.

“You have to look at every area of expenditure, including your overall social welfare budget and your public sector pay and pension bill, if you’re going to make the corrections that are necessary” he told the Dail.

Cowen added “At the end of the day, the idea that nothing can be touched in two-thirds of the expenditure of the public purse is not a realistic starting point from which to address the scale of the problems we face”.

Meanwhile, the Finance Minister’s has reiterated the Governments plans. He warned the Government has to no option but to implement four billion euro in cuts in December’s budget.

Brian Lenihan’s comments as unions warn public sector pay cuts will not be tolerated and will lead to “confrontation with Government”.

The Irish Congress of Trade Unions has backed calls for a longer than proposed period to get the public finances back on track, saying acting too quickly will just make the situation worse.

But speaking in Dublin this afternoon, Minister Lenihan was adamant that a sharp correction has to happen now:

‘ The reality is that Ireland is now borrowing about 12% of our annual wealth. If we change nothing next year, that will increase to 14 or 15% . Thats not sustainable for Ireland. We can have an academic debate about how long its going to take to exit from this when we have stabilised the deficit. We have to stabilise the deficit – there is no option on that’