Irish unveil austerity budget, seek bailout exit

DUBLIN – Ireland unveiled its seventh straight austerity budget Tuesday, a plan to slash 2.5 billion euros ($3.4 billion) from next year’s deficit and pave the way for the nation to escape from its international bailout.

Finance Minister Michael Noonan told lawmakers he was confident that Ireland can resume normal borrowing on bond markets at affordable rates by December, when the country’s bailout funds run out.

Noonan said Ireland’s bailout escape was certain because the Irish treasury had already “stockpiled” about 25 billion euros ($34 billion) to ensure that the nation’s bills can be paid through 2014.

The move comes three years after Ireland was forced by the crippling cost of bank rescues to seek 67.5 billion euros in emergency loans from the European Union and International Monetary Fund.

Police deployed heavily outside Leinster House, the parliamentary building, and key streets in central Dublin to ensure that hundreds of anti-austerity protesters did not try to block the roads.

Ireland has been raising taxes and slashing spending since 2008, when a Celtic Tiger boom fueled by cheap eurozone credit ended, bringing six domestic banks to the brink of failure. Ireland was forced in 2010 to abandon the bond markets when its own borrowing costs soared.

Noonan said Ireland expected to slash its 2014 deficit to 4.8 percent, much better than the previously agreed EU-IMF target of 5.4 percent. Aiming for a smaller deficit should help Ireland sell bonds more cheaply.

The cost of bank bailouts forced Ireland to hit an EU-record 34 percent deficit in 2010.

Noonan, whose government was formed in 2011, noted that Ireland had consistently beaten its deficit-reduction targets since then.