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Irish Prime Minister Enda Kenny outlines spending cuts Irish Prime Minister Enda Kenny outlines spending cuts
(40 minutes later)
Public spending in the Irish Republic will be cut by 2.2bn euros (£1.9bn) a year and taxes raised by 1.5bn euros, Prime Minister Enda Kenny has warned.Public spending in the Irish Republic will be cut by 2.2bn euros (£1.9bn) a year and taxes raised by 1.5bn euros, Prime Minister Enda Kenny has warned.
Mr Kenny made a televised address to the Irish people ahead of the unveiling of his government's budget for 2012.Mr Kenny made a televised address to the Irish people ahead of the unveiling of his government's budget for 2012.
Mr Kenny said the country's outgoings were currently 16bn euros a year more than it was receiving.Mr Kenny said the country's outgoings were currently 16bn euros a year more than it was receiving.
He said steps to recover from the Irish economic crisis had been taken since last year but the crisis remained.He said steps to recover from the Irish economic crisis had been taken since last year but the crisis remained.
The Irish Republic is trying to save 3.8bn euros in a new round of cost-cutting measures. The country required an international bailout last year.The Irish Republic is trying to save 3.8bn euros in a new round of cost-cutting measures. The country required an international bailout last year.
Fragile economy 'Exceptional event'
Mr Kenny said income tax would be untouched but indirect taxes would be raised, on what he said was the start of a four-year path to recovery.Mr Kenny said income tax would be untouched but indirect taxes would be raised, on what he said was the start of a four-year path to recovery.
The Irish economy remained fragile but job creation would be at the centre of the recovery, he added.The Irish economy remained fragile but job creation would be at the centre of the recovery, he added.
The pictures spoke more than the words during Enda Kenny's state-of-the-nation address to the people of Ireland.
He wore a pink tie to try to make people look on the bright side. But beside him, the Irish flag looked slighted jaded, and the European Union flag seemed about to fall over.
There is no guarantee that Ireland - and Europe - will overcome the current crisis.
But Enda Kenny looked the Irish people in the eye and told them he was optimistic.
His speech may have lifted public morale, but don't expect everyone in Dublin to go out and buy a pink tie. They would not be able to afford it.
"This budget will be tough. It has to be tough," Mr Kenny warned in his address."This budget will be tough. It has to be tough," Mr Kenny warned in his address.
Mr Kenny told the Irish public they were not to blame for the economic collapse.Mr Kenny told the Irish public they were not to blame for the economic collapse.
"Let me say this to you, you are not responsible for this crisis," he said."Let me say this to you, you are not responsible for this crisis," he said.
"My government is determined that now the necessary decision and challenges are made to ensure that this is never allowed to happen again.""My government is determined that now the necessary decision and challenges are made to ensure that this is never allowed to happen again."
The proposals are due to be outlined in the Irish parliament, starting on Monday.The proposals are due to be outlined in the Irish parliament, starting on Monday.
They are expected to include an increase in vehicle tax, cuts in some welfare entitlements and a rise in VAT to 23%.They are expected to include an increase in vehicle tax, cuts in some welfare entitlements and a rise in VAT to 23%.
'Exceptional event'
The Irish prime minister said: "Right now the state is spending 16 billion a year more than it is taking in. This problem will not be fixed unless we take action to bridge this gap. This can only be done by us, ourselves, working together."The Irish prime minister said: "Right now the state is spending 16 billion a year more than it is taking in. This problem will not be fixed unless we take action to bridge this gap. This can only be done by us, ourselves, working together."
Mr Kenny said he chose to address the Irish people directly because of the crisis the nation was facing.Mr Kenny said he chose to address the Irish people directly because of the crisis the nation was facing.
"I know this is an exceptional event. But we live in exceptional times. And we face an exceptional challenge," he said."I know this is an exceptional event. But we live in exceptional times. And we face an exceptional challenge," he said.
The Irish proposals come as Italy's new government adopted a package of emergency austerity measures aimed at fending off bankruptcy and saving the euro from collapse.The Irish proposals come as Italy's new government adopted a package of emergency austerity measures aimed at fending off bankruptcy and saving the euro from collapse.
Taxes on the assets of the wealthy will go up, as will pension ages, and there will be a major drive to tackle tax evasion.Taxes on the assets of the wealthy will go up, as will pension ages, and there will be a major drive to tackle tax evasion.
Italian Prime Minister Mario Monti said the measures were necessary to "save Italy", and announced he would give up his own salary as part of the effort.Italian Prime Minister Mario Monti said the measures were necessary to "save Italy", and announced he would give up his own salary as part of the effort.
The plans must still be approved by the Italian parliament.The plans must still be approved by the Italian parliament.