The Irish Government does not plan to ask the European Commission for an extension on the 2014 deadline for getting the country's budget deficit back in control according to a spokesman for the Department of Finance.
"It is not realistic to extend out the period of adjustment. This would result in a situation in which more and more of our revenue would be used to simply pay interest on our debt. We cannot allow this to happen,” he told the Irish Times.
The comments come in the wake of criticism and doubt from leading economic think-tanks about the governments proposed four-year-strategy to decrease the deficit in the countries public finances. The Economic and Social research institute have also endorsed the suggestion that the government should seek a further two-year extension for the reduction of the deficit.
The European Commission has rejected calls for the deadline to be extended. The chief spokesman for EU economics commissioner Olli Rehn said the Government remains committed to their goal: “The Irish Government has confirmed as of the end of September its commitment to achieving the 3 per cent per target in 2014,” he told the Irish Times.
Fine Gael finance spokesman Michael Noonan pointed out that debating over the deadline was “futile” when he said that “EU Commissioner Olli Rehn made this clear and party leaders Enda Kenny, Eamon Gilmore and Brian Cowen fully understood the choices when they confirmed that adherence to the deadline was common ground.”
On Wednesday night the Government and the two main opposition parties reiterated their joint commitment to meeting the 2014 deadline after they emerged from a two hours meeting. Following the meeting Prime Minister Brian Cowen said that the party leaders had “reaffirmed their commitment to addressing the deficit in the public finances with a view to reducing it to 3 per cent of GDP by 2014”.
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