Irish Lisbon opponents attack fiscal cuts, markets

DUBLIN (Reuters) - Irish opponents of the European Union's Lisbon reform treaty on Tuesday launched their campaign ahead of October's referendum with a warning the charter would leave workers worse off and more exposed to spending cuts.

Both sides of Ireland's Lisbon campaign are hoping to use the perilous state of the local economy to promote their case ahead of a second crucial vote on October 2.

The government is arguing Ireland could not have coped with twin fiscal and banking crises and the worst recession on record without support from the European Central Bank and Brussels.

But "No" campaigners, led by nationalist Sinn Fein and the Socialist Party, said passing Lisbon would strengthen Dublin's resolve to cut public services and raise taxes to reduce the budget deficit below an EU limit of 3 percent of gross domestic product.

"The government would be bringing forward the (fiscal cuts) anyhow," Sinn Fein Vice President Mary Lou McDonald told Reuters on the sidelines of the campaign launch.

"But there is a symmetry between the current approach that's been taken by the government and the demands of the European Treaties which say ... this is about free and unfettered competition, this is about market forces," McDonald said.

"That's a political position we oppose," said McDonald, who lost her European Parliament seat in June.

Opinion polls show a majority of Irish voters now support the treaty, which is intended to streamline decision-making in the EU, and see Brussels as a safety net against an Icelandic-style bust.

But the electorate is also angry at the government's planned austerity measures and keen to defend workers' rights as unemployment queues balloon and in the aftermath of a number of high-profile industrial disputes this year.

Analysts said pressure from anti-Lisbon groups, which include disparate voices from the left and right, would not deter Prime Minister Brian Cowen's determination to implement around 4 billion euros ($5.7 billion) worth of fiscal savings because the next budget comes two months after the referendum.

"It is really for debate purposes only," said Theresa Reidy, who lectures in public finance at the University College Cork, of the treaty opponents' resistance to spending cuts.

Last year, the anti-Lisbon campaign outshone the government's half-hearted efforts by focusing on emotive issues, some of which, including an allegation the charter would result in conscription to a European army, were untrue.

This year, Cowen, who has secured guarantees on key policy areas such as abortion and military neutrality, has vowed a vigorous campaign.

So far, however, much of the impetus on the "Yes" side has come from civil society and business groups.

"There is very little that has happened so far," Reidy said.

(Reporting by Andras Gergely; Editing by Carmel Crimmins and Sophie Hares)