ESRI calls for more cuts and tax increases
The Economic and Social Research Institute (ESRI) has said the Government should clear the budget deficit in three years, in part by imposing further spending cuts and increasing taxes.
In its latest Quarterly Economic Commentary, the ESRI urged the Government to aim for a target of 0% by 2014, instead of the planned 3% by 2015.
The economic think tank is recommending tax increases and greater public spending cuts to reduce the €18bn deficit more quickly.
The ESRI is also calling for a further average public sector pay cut of 10%.
ESRI research Professor Joe Durkan said reducing the deficit more quickly would enable Ireland to re-enter the markets sooner, in turn restoring international confidence.
He advised a property and higher car taxes, and universal water charges to increase revenues.
Mr Durkan also said it was time to consider abandoning the Croke Park Agreement, as it had under-delivered. Instead, he favours imposing an additional average 10% pay cut in the public sector:
The ESRI Professor also said a Eurozone-wide solution to the banking crisis is needed, as the debt burden should not be placed wholly on one State.
