Ireland set for nervy two weeks until budget vote

 

Irish Taoiseach Brian Cowen reacts as he speaks to the media in Government Buildings Dublin November 21, 2010.

Credit: Reuters/Cathal McNaughton

By Jodie Ginsberg and Carmel Crimmins

DUBLIN | Mon Nov 22, 2010 8:23pm EST

DUBLIN (Reuters) - Ireland begins two nervous weeks of political maneuvering on Tuesday as the government dares the opposition to block an austerity budget on which a multi-billion euro EU/IMF bailout is riding.

Irish Prime Minister Brian Cowen defied mounting pressure to quit on Monday, saying he would stay in office until parliament passed the budget, then call an early election.

Public anger at his handling of Ireland's economic and banking crisis has only grown since he announced the bailout, and his chances of passing the budget fell dramatically when two independent members of parliament said they were likely to withhold their support.

But Cowen said the national interest required that he press on to unveil a promised four-year austerity package on Wednesday, and a 2011 budget on December 7.

The government is expected to announce that it will cut the minimum wage, slash social welfare spending, reduce the number of public employees and add a new property tax and higher income taxes in a package intended to slash 6 billion euros off next year's budget, and 15 billion off the annual budget by 2014.

Trade unions have warned that the austerity plan could provoke civil unrest: a student demonstration over planned fee increases turned violent this month, and unions have organized a march to protest at the planned measures on November 27 in Dublin.

"DUTY TO BACK BUDGET

"We have entered into discussions with European partners on the basis that we are going to implement a budget that will have a 6 billion euro adjustment," Cowen told a news conference after emergency talks with his cabinet.

"We believe that there's a clear duty on all members of Dail Eireann (parliament) to facilitate the passage of these measures in the uniquely serious circumstances in which we find ourselves."

As EU and IMF negotiators thrash out details of the rescue package, Theresa Reidy, politics lecturer at University College Cork, said Cowen's Fianna Fail party seemed to be planning to cajole the opposition into abstaining on the budget.

"What we will see in the next fortnight is growing pressure on the opposition parties for the sake of political stability to abstain on the major votes," she said.

Both the main opposition parties, Fine Gael and Labour, who are likely to come to power in a coalition after next year's election, had demanded that an election take place before the budget, and seemed unlikely to fall in line soon, if at all.

"The taoiseach (prime minister) thinks he has a majority so let him go ahead and exercise his majority," said Fine Gael finance spokesman Michael Noonan.

"Do you seriously think he is looking for our support? I don't think so. I have no idea what's going to be in the budget ... There is a (Fine Gael) front bench meeting tomorrow and we will consider whether we will put down a vote of no confidence."

Analysts say most Irish people, who have endured two years of austerity and recession and now face four more years of cuts on foreign lenders' terms, would prefer an immediate election.

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