Brexit crisis deepens but ‘no need for mini-Budget’

0
98

Brexit crisis deepens but ‘no need for mini-Budget’


Talks: Hungarian Prime Minister Viktor Orban and German Chancellor Angela Merkel during the second day of the European summit. Picture: AFP/Getty
Talks: Hungarian Prime Minister Viktor Orban and German Chancellor Angela Merkel during the second day of the European summit. Picture: AFP/Getty

Taoiseach Leo Varadkar has insisted taxpayers will not face the hardship of a mini-Budget in the spring if there is a no-deal Brexit on March 29.

The Economic and Social Research Institute (ESRI) has this week predicted a major hit for the Irish economy in the event of the UK leaving the EU without a deal.

Please sign in or register with Independent.ie for free access to this article.

Sign In

window.gigyaIntegration = window.gigyaIntegration || {};
gigyaIntegration.command = gigyaIntegration.command || ;
gigyaIntegration.command.push(function() {
gigyaIntegration.addEventHandlers({
onLogin: function(e) {
location.reload();
}
});
$(‘#datawall-sign-in’).click(function(e) {
e.preventDefault();
gigyaIntegration.showLoginScreenSet({
signupSource: ‘opinion’
});
});
$(‘#datawall-sign-up’).click(function(e) {
e.preventDefault();
gigyaIntegration.showRegisterScreenSet({
signupSource: ‘opinion’
});
});
});

Fianna Fáil leader Micheál Martin had said such a development would lead to loss of some €4bn – making a spring mini-Budget inevitable.

The Taoiseach’s upbeat comments came despite British Prime Minister Theresa May’s failed efforts to wring more Brexit concessions from her EU counterparts at a fractious two-day leaders’ summit in Brussels. If the draft deal brokered by Mrs May is not ratified by the UK parliament, then the risk of a no-deal exit increases considerably.

Mr Varadkar said several times he did not believe a mini-Budget would be required – even in the case of a no-deal Brexit. He said Budget 2019 had been framed with Brexit in mind and that Ireland would be among the few EU countries to run a budget surplus next year.

The Taoiseach added that the ESRI had also predicted that economic growth would continue even in case of a no-deal Brexit. He conceded that growth was forecast to halve, from a projected 6pc to 3pc.

“The kind of environment in which you have a mini-Budget, or emergency Budget, is when you go into recession, not when your economy grows by 3pc,” Mr Varadkar said as he ruled out the idea on three separate occasions.

Mrs May, who had a public spat with EU Commission President Jean-Claude Juncker after he had referred to her approach as “nebulous”, returned to the conference centre again yesterday.

She again put up a defiant front for journalists and insisted she would continue to try to gain further EU concessions that would help her sell her deal.

“There is work still to do and we will be holding talks in coming days about how to obtain the further assurances that the UK parliament needs in order to be able to approve the deal,” she said before she left Brussels.

The Taoiseach said the next move in the ongoing stand-off rested with Mrs May.

He also insisted he did not believe a no-deal Brexit was likely and he argued Britain could avoid it by either revoking its application to leave, or seeking an extension of the negotiating deadline.

But Mr Varadkar also said his government would publish details of its own contingency plans to manage a no-deal Brexit late next week. The EU Commission is due to publish its plans next Wednesday and the Government is due to meet business representatives and other groups concerned next Thursday and Friday.

The Taoiseach said that more preparation information would emerge after these meetings. More details would follow in January.

Mr Varadkar repeated his view, echoed by all other EU leaders, that efforts to help Mrs May would be confined to “explanations and clarifications”, with no question of re-opening negotiations.

The Taoiseach said that if a no-deal Brexit was imminent next March, an extension of the negotiations would be accepted by the 27 governments if requested by the British side.

But he pointed out no EU leaders’ summit was scheduled until late March.

Irish Independent

LEAVE A REPLY

Please enter your comment!
Please enter your name here