Budget paralysis as we brace for Brexit impact
Crash-out fear: €1.2bn package aimed at providing soft landing Last-ditch bid: Varadkar to meet Johnson to try to salvage a deal Money: Workers get nothing back with no cash for tax cuts
THE “shadow of Brexit” has stopped Finance Minister Paschal Donohoe from giving anything back to hardpressed workers in Budget 2020.
As talks aimed at securing a deal veered toward collapse in Brussels, Mr Donohoe announced a €1.2bn package aimed at providing a soft landing for a hard Brexit.
He will plunge the country’s finances back into deficit by borrowing €650m if necessary.
Shortly after the Budget speech, Taoiseach Leo Varadkar was on the phone to UK Prime Minister Boris Johnson in a last-ditch bid to salvage the talks.
No progress was made during a “detailed” 45-minute discussion – but the two leaders will meet by the end of the week if talks aren’t abandoned before then. Last night, Downing Street sources claimed the EU had “24 hours to find a compromise” or the talks would collapse.
The reality of Brexit hit home as Mr Donohoe admitted there was no money for income tax cuts or pension increases next year.
In fact, the majority of workers are set to pay more income tax in the coming year due to pay rises.
As Brexit negotiations teetered on a knife edge last night, Tánaiste Simon Coveney flew to Brussels.
After a meeting with the EU’s chief negotiator Michel Barnier, Mr Coveney admitted there was a “real gap” between the EU and UK.
“There are some in the UK who seem to be planning for a general election ahead of trying to plan to get a deal in the context of some of the pressure that has been put on and some of the commentary we have seen over the past 24 hours,” Mr Coveney said.
This was a reference to briefings from Downing Street which claimed the Taoiseach “doesn’t want to negotiate”.
The ‘Spectator’ magazine, which is closely linked to the Conservative Party, reported sources as saying: “Varadkar has also gone back on his commitments – he said if we moved on manufactured goods then he would also move but instead he just attacked us publicly.”
They said Mr Varadkar was seeking to “gamble on a second referendum” and was encouraging Mr Barnier “to stick to the line that the UK cannot leave the EU without leaving Northern Ireland behind”.
Speaking on RTÉ News last night, Mr Varadkar said: “I don’t play dirty. I don’t think most EU leaders do either. We’ve been very straight up.”
He said Ireland wanted a deal but “not at any cost”.
“I think it’s going to be very difficult to secure an agreement by next week, quite frankly.”
The Taoiseach said the UK had reneged on commitments made to Northern Ireland and then “put half of that back on the deal and said that’s a concession, which it isn’t really”.
The latest Brexit acrimony