Irish Union Leaders Warn Of Chaos If Budget Tax Pledges Are Not Kept

by Jason Gorringe, Tax-News.com, London

07 September 2001

Following revelations of the expected £1 billion shortfall in government tax revenues, the leaders of the Irish Congress of Trade Unions and SIPTU have warned that there will be industrial relations chaos if tax cuts for lower income workers promised under the national pay deal are not fulfilled.

'They have to deliver them,' said ICTU President Joe O'Toole.'The economy is still doing extremely well and we have a major surplus.' His comments were echoed by SIPTU leader, Des Geraghty, who warned that his 200,000 strong union would not let the government 'off the hook', and would demand adherance to the terms of the PPF, at least in relation to the tax promises made. However, spending analysts at AIB have predicted that the shortfall is likely to be nearer to £2 billion unless the government reins in public spending.

Taoiseach Bertie Ahern is playing down concerns over the forthcoming budget, but despite having publicly stated that there was no question of the government reneging on tax promises as a result of the expected surplus shortage, refused to be drawn on the issue of a possible 2% reduction in the top income tax rate. However, it emerged earlier in the week that Finance Minister Charlie McCreevy has warned his cabinet colleagues to scale down their spending plans.

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