Irish leader denies leaking budget to Germany

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Irish Prime Minister Enda Kenny on Thursday rejected accusations that he had given details of his country's upcoming budget, including a proposed hike in VAT, to German officials.

Irish opposition parties said if reports were true that the document was seen in the German parliament, it would represent a "staggering breach of faith" which suggested Germany was "now pulling the strings," the Irish Times reported.

"Let me confirm something to you, the cabinet have made no decision in regard to the budget. It is on December 6," Kenny said after a meeting in Belfast.

"I'm not going to comment on speculative (reports) or comment about decisions that have not been taken by the government at all."

The Irish premier, who met with German Chancellor Angela Merkel on Wednesday, added he had "no idea" how the document ended up in the Bundestag.

According to the document, seen by the Reuters news agency in Germany's parliament, the Irish government is set to announce a two percent increase in the top VAT rate to 23 percent.

It hopes the hike will generate 670 million euros (900 million dollars) for Ireland's public coffers, according to the document which was reportedly dated November 2011 but had not been signed by finance minister Michael Noonan.

In November 2010, Ireland was forced to seek an 85-billion-euro rescue package from the EU and the International Monetary Fund to deal with massive debt and deficit problems.

A finance ministry spokesman told AFP the document "may be a draft of one of the documents being prepared as part of the quarterly review of the Irish programme of assistance with the Troika (the EU, IMF and ECB)."

Michael McGrath, finance spokesman for the main Fianna Fail opposition party, said if the reports were accurate "it would be a staggering and unprecedented breach of faith with the Irish parliament and Irish people."

"We need to know whether the Irish government has revealed the detail of its budget plans to the German budget committee," he added, according to the Irish Times.

Ireland's 2012 budget next month will involve 3.8 billion euro in spending cuts and tax hikes aimed at cutting the public deficit to 8.6 percent of Gross Domestic Product.

© 2011 AFP

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