Tánaiste Joan Burton has said no-one wants to return to economic cycles of "bubble and boom and bust".

Speaking in Dublin today after an Irish Fiscal Advisory Council report urged the Coalition to proceed with another tough budget next month, Ms Burton said: "What they agree on as well is the deficit target and building a sustainable recovery.

“Nobody wants to go back to bubble and boom and bust cycles and very sensibly that’s part of their report and I agree with that.”

The pre-budget report, described as very important by Ms Burton, warns that considerable work is still required to repair the public finances and that the Government should still go ahead with its original plan to retrench by a further €2 billion.

Although the council notes that economic and fiscal developments have been significantly better than expected, it says a “premature easing” in fiscal adjustment would increase the risk of new measures being required in the future.

The council, chaired by NUI Galway economist Prof John McHale, is an independent statutory body set up in the wake of the crash to monitor economic policy. One of its main functions is to assess and comment publicly on whether the Government is meeting its own stated budgetary targets and objectives.

The council has never issued such a pre-budget statement in the past. Its intervention today reflects concern that fiscal discipline is being relaxed.

The statement follows official data which showed that Ireland's economic growth has reached levels not seen since the "Celtic Tiger" boom.

The report came only days after Minister for Finance Michael Noonan said there would be no need for a new round of tax increases and spending cutbacks next year.