Irish Government Published Four Year Recovery Plan
DUBLIN: The Irish government announced on Wednesday that, over the next coming four years in order to reduce the country’s deficit, it published a four year recovery plan that involves a record budget cut of 15 billion euros (about 20 billion U.S. dollars).
The four year plan between 2012 and 2014 includes 6 billion euros (about 8 billion dollars) in spending cuts next year and another 9 billion euros (about 12 billion dollars). One of the highest in Europe, it will consist of increase in income tax, along with deep cuts in social welfare expenditure and a reduction of 10 percent or more in the minimum wage.
The plan was unveiled by Prime Minister Brian Cowen, Environment Minister John Gormley and Finance Minister Brian Lenihan, which is described as a “blueprint for a return to sustainable growth in our economy”. The government had already made clear that over the next four years, an “adjustment” of 15 billion euros (about 20 billion dollars) will have to be made in this regard.
The plan also confirms that by way of cuts in the spending, 10 billion euros (about 13 billion dollars) will be saved and by the way of tax increases it will be 5 billion euros (about 7 billion dollars). The government will reduce the cost of the public sector pay and pension’s bill, social welfare, public service programs, and achieve savings in social welfare expenditure of 2.8 billion euros which is around 3.7 billion dollars, according to the plan.
The plan asserted while adding that the overall payroll adjustment of 1.2 billion euros (1.6 billion dollars) by 2014, the government will reduce the number of pubic service staff by 24,750 from the level of the end of year 2008, which is back to the level as last seen in the year 2005.
The plan asserted that it will introduce a reformed pension scheme for new entrants to the public service and reduce their pay by 10 percent. According to the plan, measures including reducing the minimum wage by 1 euro (1.3339 dollars) to 7.65 (10 dollars), will create 90,000 jobs during the course of plan.
